Peel water users to be hardest hit

TAMWORTH ratepayers will be the hardest hit in the state under a contentious new proposed pricing system for water, just-released figures have revealed.

State Water has applied to the ACCC to change the way water usage costs are calculated in NSW, pushing for a full cost recovery system.

This means councils and irrigators sourcing water from valleys with relatively few users – like the Peel – will be lumbered with far higher water extraction charges.

Figures from Tamworth Regional Council (TRC) show Peel users would face a 107 per cent increase by 2016-17 – more than double the next highest in the state – while some other areas will see a cost decrease by up to 49 per cent.

Council is imploring the ACCC to reject the new pricing structure and instead implement a “postage stamp” charging system to make the price of water uniform across NSW.

TRC director of water enterprises Bruce Logan said the new charges could have far-reaching impacts on the city.

“No other Murray Darling Basin town will experience such huge increases in costs as Tamworth under the proposal – how can this be equitable?” Mr Logan said.

“Council has significant concerns that the proposed price increases unfairly discriminate against towns and cities that, through no fault of their own, happen to be receiving water from a state owned source that is expensive to operate.

“The cost of water should not be a primary consideration for industry wishing to relocate to a particular regional areas, but repeated price rises already experienced in the Peel and proposed for the future are contributing to the cost of water becoming just such a consideration.”

The proposed price rises will be examined by IPART and the ACCC before being implemented.

Mr Logan said council had stumped up 25 per cent of the construction cost of Chaffey Dam, and more again for upgrades, but had received “no financial recognition” for it.

“Council accepts the Peel Valley and Chaffey Dam are relatively small and is therefore quite expensive to run, but council was not involved in the original decision about dam sizes and should not be penalised now for poor  decisions made in the past,” he said.

“95 per cent of all water that falls in the Peel valley flows into the Namoi and valleys beyond. 

“Why then do we have to pay almost three times as much for that water at Tamworth than if it was intercepted at Gunnedah 75km away on the Namoi?”

A response was sought from the ACCC but not received by deadline.

AT A GLANCE:

Per-valley water cost increase from current to 2016-2017:

Peel 107%

Namoi 18%

Murrumbidgee 26%

Border -49%

Gwydir -4%

Lachlan 45%

Macquarie 40%

Murray -32%

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