AEC has again undertaken water supply and wastewater price benchmarking for large Queensland local government utilities, consisting of 10 South-East Queensland (SEQ) Water Grid service areas and 10 non-SEQ service areas.
The Queensland industry median water charge for residential customers serviced by large local government utilities in 2016/17 was calculated as: $860.46 for a household consuming 200kL per annum (an increase of 4.8% on the prior year median); and $1,499.96 for a household consuming 400kL per annum (an increase of 5.4% on the prior year median).
The SEQ median charge increased by 1.9% at 200kL consumption and by 2.5% at 400kL consumption, while the non-SEQ median charge increased by 0.8% at 200kL consumption and by 3.4% at 400kL consumption.
The following graph shows that the SEQ median charge at 200kL consumption has historically increased at a greater rate than the non-SEQ median charge, to the extent that the gap between the two is now $303, up from just $74 in 2007/08. This gap is not expected to widen much further in the future as most SEQ Councils have arrived at the destination price for bulk water.
• Water price increases should continue to moderate in SEQ.
• Water price increases outside of SEQ should increase at a greater rate than in SEQ as a result of some bulk water price increases being proposed for selected service areas.
Median Residential Water Bill over Time for a Property Consuming 200kL, 2007/08-2016/17
The Queensland industry median wastewater charge for residential customers serviced by large local government utilities in 2016/17 was calculated as $651.05, an increase of 3.4% on the prior year median of $629.67. The SEQ median charge increased by 1.4%, while the non-SEQ median charge increased by 4.4%.
The following graph shows that annual increases in charges outside of SEQ have generally been greater than those in SEQ, resulting in the non-SEQ median overtaking the SEQ median in 2014/15 and being presently $48 higher than the SEQ median.
Looking forward, wastewater price increases are anticipated to continue to be relatively higher in non-SEQ regions, with costs spread over a smaller customer base and enhanced cost recovery levels being achieved.
Median Residential Wastewater Bill over Time, 2007/08-2016/17
AEC Group Pty Ltd (AEC) is an industry leader in the water and wastewater sector, having provided advice to a large number of service providers regarding their financial and pricing strategies over the past two decades. If you require assistance regarding cost recovery and/or charging structures, please don’t hesitate to contact Gavin O’Donovan, Director - Finance, on (07) 3831 0577 or via firstname.lastname@example.org.