Water price review 2018

We have conducted a review of the length of the period of North East Water’s eight-year price determination.

View North East Water’s submission and our letter to North East Water outlining our decision on the continuation of the determination.

We have completed our review of the prices that 17 Victorian water businesses will charge from 1 July 2018.

Our determinations set out the prices from 1 July 2018 to 30 June 2023, except for:

• North East Water: 1 July 2018 to 30 June 2026
• South Gippsland Water and Western Water: 1 July 2018 to 30 June 2020. 

On 1 July 2021, City West Water and Western Water integrated to form Greater Western Water. The price determinations for City West Water and Western Water apply to 30 June 2023.

Prices across Victoria will generally remain steady, or even fall from 1 July

Most water customers will benefit from flat or falling water prices. In 2018–19, typical residential bills will fall or remain relatively steady for 13 water corporations, with the biggest declines for customers of South East Water (Melbourne’s south eastern suburbs), GWMWater (Horsham), City West Water (Melbourne’s CBD and western suburbs) and Coliban Water (Bendigo).

Over the five year period from 1 July 2018, customers of Goulburn Valley Water (Shepparton) will benefit from the largest reduction of around $90 for a typical residential customer.

Customers of North East Water (Wodonga) will see small price increases of $4 per year for a typical customer, but will still have some of the lowest water bills in Australia. Customers of Gippsland Water and Westernport Water will see a one-off bill increase in 2018–19, with typical bills rising with inflation over the next four years.

What will happen to your bill?

Typical residential owner occupier water bills are based on the average consumption for households in that region and are presented in $2018-19 terms.

Tariff structures will generally remain the same

Urban water corporations will continue to charge a fixed service charge and variable component that depends on water use. Many water corporations will rebalance the mix of these variable and fixed charges in response to feedback from customers. Other changes to tariffs include:

• City West Water and South East Water removing the third step in their inclining block tariff for residential water use
• City West Water, South East Water and Yarra Valley Water reducing the sewage disposal charge for residential customers. Only Melbourne metropolitan water corporations charge this fee   
• Barwon Water and Westernport Water increasing the mix of the variable water usage charge
• Southern Rural Water simplifying tariffs by combining some existing charges and removing others. 

Price submissions were informed by customers

Price submissions were informed by an unprecedented level of customer engagement by the water sector. In total, the 17 water corporations heard the views of over 150,000 customers on water services, prices and investment. They learned what was important to their customers and this helped to ensure that the price submissions were more highly informed by customer views than ever before.

Informed by their engagement programs, the water corporations have committed to improving services in key areas. As well as continuing to invest in safe and reliable water and sewerage services, some of the ways the water corporations plans to improve outcomes are:

• improving the timeliness and quality of communication with customers
• increasing the ways customers can communicate and receive information from the business
• providing regional Victorians with better tasting and more reliable drinking water 
• extending support for vulnerable customers
• upgrading water and sewerage networks to address population growth and climate change.

Support for vulnerable customers

For the majority of water corporations, customers identified affordability and fairness among their priority concerns. Some of the ways the water corporations plan to respond includes:  

• improving awareness about assistance they offer 
• extending access to services and programs for customers experiencing difficulty paying their bills
• increasing support for financially vulnerable customers, including for those affected by family violence.

Read our customer fact sheet showing an overview to the 2018 water price review.

We review water prices in line with key pricing requirements

As part of the water price review process, water businesses send us submissions on their proposed prices and key outcomes. Once we make a determination on these proposals, we create annual tariff schedules for each Victorian water business. The schedules outline the maximum prices each water business can charge their customers for specific services, such as water delivery and sewage processing.

We review the price submissions against the Water Industry Regulatory Order (2014), the Essential Services Commission Act 2001, and the guidance we provided water businesses in November 2016.

This review is the first one we’ve undertaken under our new water pricing approach (PREMO), which includes new incentives for water businesses to deliver outcomes most valued by customers. PREMO also enables us to fast-track submissions where we are able to quickly assess compliance with our guidance and the regulatory order.

Review key dates in our 2018 water price review process.

Read about how water bills are calculated and how we regulate the water sector.