Below we present key information on our draft decisions for Water NSW’s rural bulk water services for customers in the Murrumbidgee valley. This information is not exhaustive and should be viewed in conjunction with our Draft Report and Draft Determination.
Draft decision on costs for the Murrumbidgee valley
Under our draft decisions, Water NSW’s costs are higher than those used to set prices for the 2017 Determination. The customer share of:
- operating expenditure for Murrumbidgee valley has increased by 24.4% but is 9.4% lower than proposed by Water NSW
- capital expenditure for Murrumbidgee valley has decreased by 4% and is 2.6% lower than proposed by Water NSW
- Murray Darling Basin Authority (MDBA) costs for Murrumbidgee valley have decreased by 0.9% and are 36.5% lower than proposed by Water NSW.
The cost of capital has also decreased from 3.1% to 1.3%.
Draft decision on customer share of revenue requirement for Murrumbidgee valley over 2021 Determination
Note: UOM is the pay-back of "unders and overs mechanism" balance from the 2014-17 regulatory period.
Data source: IPART analysis.
What drives the change in costs for Murrumbidgee valley since the 2017 determination period?
Data source: IPART analysis.
Draft decision on prices for the Murrumbidgee valley
Under the ACCC rules, we are required to set prices for Water NSW that recover its full efficient costs of providing its bulk water services (net of any Government contributions). The table below sets out our draft decision on Water NSW’s prices, as well as prices that would recover Water NSW’s proposed costs on a 4 year full cost recovery (FCR) basis.
Draft decision on bulk water charges – Murrumbidgee valley ($/ML, $2021-22)
| Current 2020-21 ($2020-21) | 4 year FCR Proposed | Draft Report | Change current to proposed | Change current to Draft Report | Draft Report to proposed | |
| Bulk water charges excluding MDBA costs ($/ML) | ||||||
| High security | $3.18 | $4.21 | $3.88 | 32.4% | 22.0% | -7.8% |
| General security | $1.19 | $1.45 | $1.33 | 21.8% | 11.8% | -8.3% |
| Usage | $3.57 | $4.84 | $4.44 | 35.6% | 24.4% | -8.3% |
| Bulk water MDBA charges ($/ML) | ||||||
| High security entitlement | $1.73 | $2.78 | $1.87 | 60.7% | 8.1% | -32.7% |
| General security entitlement | $0.65 | $0.95 | $0.64 | 46.2% | -1.5% | -32.6% |
| Usage | $0.33 | $0.52 | $0.36 | 57.6% | 9.1% | -30.8% |
| Bulk water charges including MDBA costs ($/ML) | ||||||
| High security entitlement | $4.91 | $6.99 | $5.75 | 42.4% | 17.1% | -17.7% |
| General security entitlement | $1.84 | $2.40 | $1.97 | 30.4% | 7.1% | -17.9% |
| Usage | $3.90 | $5.36 | $4.80 | 37.4% | 23.1% | -10.4% |
Note: Water NSW’s proposed prices are based on prices that recover Water NSW’s proposed costs over a 4 year period on a full cost recovery basis.
Source: Water NSW proposal and IPART analysis.
Indicative bills under our draft decisions for the Murrumbidgee valley
The table below shows indicative bills for 2021-22 under our draft decisions, as well as indicative bills that would arise from Water NSW’s proposed prices (based on full cost recovery over 4 years).
Indicative annual bulk water bills including MDBA costs for Murrumbidgee valley ($2021-22)
| Estimated entitlements (ML) | Estimated usage (% of entitlement) | Current 2020-21 ($2020-21) | 4 year FCR Proposed | Draft Report | Change current to proposed | Change current to Draft Report | Draft Report to proposed | |
| High Security | ||||||||
| Small user | 5 | 90% | $42 | $59 | $50 | 40.3% | 19.6% | -14.8% |
| Medium user | 100 | 90% | $842 | $1,181 | $1,007 | 40.3% | 19.6% | -14.8% |
| Large user | 2,000 | 90% | $16,840 | $23,628 | $20,140 | 40.3% | 19.6% | -14.8% |
| General Security | ||||||||
| Small user | 10 | 40% | $34 | $45 | $39 | 33.6% | 14.4% | -14.4% |
| Medium user | 150 | 40% | $510 | $682 | $584 | 33.6% | 14.4% | -14.4% |
| Large user | 2,000 | 40% | $6,800 | $9,088 | $7,780 | 33.6% | 14.4% | -14.4% |
Source: Water NSW proposal and IPART analysis.
The indicative bills shown below represent indicative bills combining Water NSW’s prices for its bulk water services and the Water Administration Ministerial Corporation’s (WAMC’s) prices for its water management services.
High security bills for Murrumbidgee valley (medium user)
Note: We used actual entitlement numbers and allocations data in defining “small", "medium" and "large" users. We note this differs to the approach we used for our Issues Paper valley-specific information. See our WAMC Draft Report for further information on WAMC bills.
Data source: Water NSW proposal and IPART analysis.
General security bills for Murrumbidgee valley (medium user)
Note: We used actual entitlement numbers and allocations data in defining “small", "medium" and "large" users. We note this differs to the approach we used for our Issues Paper valley-specific information. See our WAMC Draft Report for further information on WAMC bills.
Data source: Water NSW proposal and IPART analysis.