In Tasmania, TasWater is responsible for providing water and sewerage services, the independent Tasmanian Economic Regulator is responsible for setting water and sewerage charges, and the Tasmanian Government is responsible for the regulatory arrangements for water and sewerage prices, under the Water and Sewerage Industry Act 2008.
Legislation to establish a single, state-wide water and sewerage corporation in Tasmania completed its passage through Parliament on 21 November 2012. TasWater commenced operations on 1 July 2013, following the amalgamation of the three regional water and sewerage corporations, namely Ben Lomond Water, Cradle Mountain Water, Southern Water, and their common service provider Onstream. TasWater is owned by Tasmania’s local councils. This amalgamation is part of the ongoing reform of Tasmania’s water and sewerage industry, which has a key aim of ensuring that TasWater has sufficient revenue to provide acceptable water and sewerage services and meet environmental and health standards for all Tasmanians.
From 1 July 2013, the water and sewerage charges paid to TasWater reflect the pricing arrangements established under the Price and Service Plans of the three earlier water and sewerage corporations as these Price and Service Plans have now been adopted by TasWater.
On 28 May 2012, the Regulator released a Final Report and Final Price Determination for the Tasmanian water and sewerage industry for the first regulatory period from 1 July 2012 to 30 June 2015. This included the adoption of two-part pricing for water, as set out in the pricing principles of the Water and Sewerage Industry Act. This approach is consistent with the approach taken by most other Australian jurisdictions.
Two-part pricing was supported by the rollout of water meters to properties without a working meter. The installation of water meters has given customers some control over the size of their bills and has helped TasWater to reduce water losses due to leakage, and more efficiently target some capital expenditure that maintains its pipeline infrastructure. Reducing the water lost to leakages has also allowed TasWater to defer expensive capital works that are needed to accommodate the growing demand for water in some areas.
The current level of prices set by TasWater for delivering water and sewerage services to customers is well below cost recovery. Under the Price and Service Plans, charges are set to put TasWater on a path to ensure that it will have sufficient revenue to operate effectively, including improving its infrastructure to meet the necessary health and environmental standards, and to prevent sewerage spills and boil water alerts, which have historically been experienced every year across Tasmania.
The second regulatory period will commence on 1 July 2015. It is intended that the current charging approach will be transitioned into full cost reflective pricing, which will be fully implemented by the end of this period, namely the 2019–20 financial year. This means that the Regulator will set prices for TasWater which will enable it to recover the full cost of providing water and sewerage services across Tasmania.
The three corporations increased investment in water and sewerage infrastructure to improve the services delivered to customers. This work is being continued by TasWater. Infrastructure projects currently being undertaken by TasWater include:
- the Lilydale treated water project ($7.97 million);
- the Forth-Paloona treated water supply project ($6.6 million);
- King Island water quality project ($4 million);
- Bridport sewage treatment plant upgrades ($5.5 million);
- Brighton sewage treatment plant upgrade ($8.5 million); and
- Ti-Tree Bend, Launceston sewage treatment plant – odour reduction ($1.6 million).
Detailed information on the performance of the water and sewerage industry is contained in an annual report produced by the Economic Regulator. The most recent report, the State of the Industry Report 2011-12, can be found on the Economic Regulator's website.