Herald Sun

Wa­ter cost pain de­lay

Plan puts off de­sal re­pay­ment

- MATT JOHN­STON AND KAREN COL­LIER matthew.john­ston@news.com.au

VIC­TO­RIA’S multi-bil­lion­dol­lar de­sali­na­tion plant would take decades longer to pay off un­der a new re­pay­ment plan put for­ward by Mel­bourne Wa­ter.

The pro­posal would see $18 bil­lion in re­pay­ments due over 27 years spread out over 60 years in­stead, ini­tially re­duc­ing wa­ter bills by be­tween $3.70 and $11 a year.

But the move would in­crease the over­all cost to wa­ter users in the long term, be­cause of Mel­bourne Wa­ter bor­row­ing costs.

Mel­bourne Wa­ter says the Es­sen­tial Ser­vices Com­mis­sion asked it to con­sider the op­tion and it “would mean those who ben­e­fit from the de­sali­na­tion plant will con­trib­ute to its cost”.

“Mel­bourne Wa­ter would need to bor­row more money in the short term and cus­tomers would pay the ad­di­tional in­ter­est, but it would re­sult in lower bills for cus­tomers now,” it says.

The other op­tion be­ing con­sid­ered is to re­tain the sta­tus quo.

The Won­thaggi plant, which has never been used, costs about $620 mil­lion a year to keep op­er­a­tional — which is paid for by wa­ter users through their bills.

If de­sal wa­ter was to be or­dered, pay­ments would in­crease by $30 mil­lion$100 mil­lion a year.

Con­sumer Ac­tion Law Cen­tre chief ex­ec­u­tive Ger­ard Brody said it was fair that fu­ture gen­er­a­tions con­trib­uted to the pro­ject cost in­stead of to­day’s house­holds shoul­der­ing most of the bur­den.

A joint Con­sumer Util­i­ties Ad­vo­cacy Cen­tre, Con­sumer Ac­tion and Vic­to­rian Coun­cil of So­cial Ser­vice sub­mis­sion on the plan says: “It is ef­fi­cient and eq­ui­table that the costs be spread across the cus­tomers who will ben­e­fit from the plant over its es­ti­mated 60-year life”.

But Na­tion­als Leader and Coali­tion wa­ter spokesman Peter Walsh slammed the plan.

“Daniel An­drews is just lump­ing the mas­sive cost of his de­sal white ele­phant from our chil­dren on to our chil­dren’s chil­dren,” he said.

If $10 mil­lion a year in re­pay­ments were spread over a longer pe­riod, about $30 mil­lion would need to be re­cov­ered af­ter the 27-year con­tract ends.

 ??  ?? A worker checks fil­tra­tion at Won­thaggi De­sali­na­tion Plant.
A worker checks fil­tra­tion at Won­thaggi De­sali­na­tion Plant.

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