Projects

Determination of SA Water's Drinking Water and Sewerage Revenue 2013/14 - 2015/16

Stage:
Final
Released:
27 May 2013
Closes:
27 May 2013
Project Type:
Pricing & access
Contact Person:
Nathan Petrus

The Commission will make its first revenue determination for SA Water in May 2013, setting maximum allowed revenues for drinking water and sewerage retail services for the three year period from 1 July 2013 to 30 June 2016.

SA Water has provided the Commission with its Regulatory Business Proposal (RBP) for the revenue determination period 2013/14 - 2015/16. The Commission has released the RBP, non confidential attachments and an Issues Paper prepared by the Commission, for public consultation.

The Commission invites comments from interested parties on the RBP and Issues Paper by 9 November 2012.

Submissions should be directed to:

Determination of SA Water's Drinking Water & Sewerage Revenue 2013/14 - 2015/16

Essential Services Commission of SA
GPO Box 2605, Adelaide   SA   5001

Telephone: (08) 8463 4444    Facsimile: (08) 8463 4449   Email: escosa@escosa.sa.gov.au

It is Commission policy to make all submissions publicly available via its website, except where a submission, either wholly or partly, contains confidential or commercially sensitive information provided on a confidential basis and appropriate prior notice has been given.

The Commission may also exercise its discretion not to exhibit any submission based on their length or content (for example containing material that is defamatory, offensive or in breach of any law).

Publications

The Commission is undertaking the first independent determination of the amount of revenue that can be recovered by SA Water from its drinking water and sewerage customers.

The Commission has released for public consultation a Draft Revenue Determination for SA Water for the three years commencing 1 July 2013. As part of this Determination, the Commission will set maximum revenues (‘revenue caps’) for SA Water’s water and sewerage services.

SA Water will be responsible for setting specific prices (such as supply and usage charges) for residential and non-residential customers; however, those prices must comply with the average revenue caps in the Commission’s Final Revenue Determination.

Proposed changes to SA Water’s revenues

The Draft Revenue Determination would reduce SA Water’s real average drinking water revenue by 5.4% on 1 July 2013 and increase real average sewerage revenue by 1.7% on 1 July 2013, as set out below. Following the 1 July adjustment, the Commission does not expect to change average real water and sewerage prices during the next three years.

Real Average Water and Sewerage Revenue Caps 2013-14 – 2015/16

Year

2012/13

2013/14

2014/15

2015/16

Water revenue ($ per kL)
(annual change)

4.34
 

4.10
(-5.4%)

4.10
(-0.0%)

4.10
(-0.0%)

Sewerage revenue ($ per connection)
(annual change)

600.40
 

610.63
(+1.7%)

610.63
(+0.0%)

610.63
(+0.0%)

The net effect is a 3.3% reduction in the overall real average price for water and sewerage combined. At the start of each year the Commission will convert these real revenue caps into nominal revenues by adjusting for inflation.

Request for submissions

The Commission welcomes comment from all interested parties on the Draft Determination and will consider all submissions in making its Final Revenue Determination.  Comments are required by COB 19 March 2013.

  • Submissions should be directed to:

Determination of SA Water's Drinking Water and Sewerage Revenue 2013/14 - 2015/16
Essential Services Commission of SA
GPO Box 2605
Adelaide SA 5001

T: (08) 8463 4444 | F: (08) 8463 4449 | Email: escosa@escosa.sa.gov.au

It is Commission policy to make all submissions publicly available via its website except where a submission, either wholly or partly, contains confidential or commercially sensitive information provided on a confidential basis and appropriate prior notice has been given.

The Commission may also exercise its discretion not to exhibit any submission based on their length or content (for example containing material that is defamatory, offensive or in breach of any law).

Publications

The model that underpins the water demand forecast used in the Commission's draft determination of SA Water's water and sewerage revenues for 2013-14 to 2015-16 has been released.

Publications

The Commission has received the following public submissions in response to its Draft Determination of SA Water's Drinking Water and Sewerage Revenue 2013/14 - 2015/16.

Submissions

The Commission has today (17 May 2013) received a Second Pricing Order from the Treasurer. The Second Pricing Order provides certain further directions that the Commission must comply with in making its Final Revenue Determination for SA Water’s drinking water and sewerage retail services for the three-year period from 1 July 2013.

The Commission expects that it will be able to make a Final Revenue Determination that complies with the further directions contained in the Treasurer’s Second Pricing Order in time to publicly release it on Monday 27 May.

Publications

The Commission has released its final decision on SA Water’s revenues for the three-year regulatory period, 1 July 2013 to 30 June 2016.

This decision sets out the maximum revenue per unit sold that SA Water can recover from its drinking water and sewerage customers over the regulatory period.

SA Water is responsible for setting specific prices (such as supply and usage charges) for residential and non-residential customers; however, those prices must comply with the average revenue caps in the Commission’s Final Revenue Determination.

The Final Revenue Determination results in a nominal reduction in SA Water’s current average drinking water revenue of 5.5% per cent from 1 July 2013; this represents a real (inflation adjusted) reduction of 7.8%. SA Water’s average nominal sewerage revenues from 1 July 2013 will increase by 1.6%, which is a 0.9% real decrease.

In 2014/15 and 2015/16, the average revenue from both services will be allowed to increase with the annual change in CPI only.

Real Average Water and Sewerage Revenue Caps 2013/14 - 2015/16
Year 2012/13 2013/14 2014/15 2015/16
Water Revenue
($ per kL)
4.337 4.098 CPI CPI
(annual change)   (-5.5%)
Sewerage Revenue
($ per connection)
600.396 610.113 CPI CPI
(annual change)   (+1.6%)    

 

Publications