Third party access
On 1 July 2016, the South Australian Parliament introduced a third party access regime through the Water Industry Act 2012. The regime promotes competition in upstream and downstream markets, to encourage efficiency, competition and innovation in the water industry, and to maintain protections for the security of the state’s water supply and the health and safety of South Australians.
The access regime establishes a negotiate-arbitrate framework to allow third parties to pay to move water or sewerage through SA Water’s water and sewerage infrastructure. The access regime provides a backstop to commercial negotiations between access seekers and SA Water, which can allow parties to negotiate on a more equal footing.
Please refer below for further information about the regime.
About the regime
The Commission has prepared the following background material on the operation of the third party access regime under the Water Industry Act 2012.
Seeking access from SA Water
Potential third party access applicants are encouraged to contact SA Water in the first instance by phone on (08) 7224 1379 or by visiting the SA Water Third Party Access website portal.
SA Water’s broad roles – as a regulated operator under the access regime – include to negotiate in good faith with access seekers, provide certain information and documents to access seekers and the regulator, keep separate accounts and records, and comply with requirements of the arbitrator.
The broad roles of the Commission, as regulator under the access regime, include to monitor and enforce compliance with the Act, resolve disputes by conciliation and determine whether a dispute should be referred to arbitration, and prepare and deliver reports to the Minister for Climate, Environment and Water (Minister).
The Commission’s role includes the following functions:
- it is the body to which disputes are referred to and must, in the first instance, seek to resolve the dispute by conciliation. If a dispute is not resolved by conciliation, the Commission may refer the dispute to arbitration
- it can require a regulated operator to give the Commission specified information or documents related to the regulated operator's water/sewerage service business
- it must prepare and deliver to the Minister a report of the work carried out by the Commission relevant to the Regime, each financial year, and
- it must review the regime and recommend to the Minister whether or not the access regime should continue for a period of five years.
The Government, through proclamation, is responsible for determining the extent to which the Regime applies to water/sewerage infrastructure, operators or services.
The access regime applies in full to services provided by, or through, certain declared water pipelines operated by SA Water.
It applies only in part (for example, includes certain provisions for information provision, but does not allow for conciliation and arbitration) to bulk and local sewerage networks, water distribution networks to which SA Water’s license relates, and infrastructure and infrastructure services the use of which is necessary for the transport of water in declared water pipelines.
Other water industry entities are not covered under the regime at this stage.
Under the Act, if a dispute is referred to arbitration, the arbitrator must take into account any direction issued by the Minister for Climate, Environment and Water (Minister) under the Public Corporations Act 1993. On 24 June 2016, the Minister issued the following direction.
The direction requires SA Water to use a state-wide retail-minus avoidable cost pricing methodology to calculate access prices for declared water pipelines, unless otherwise approved by the Minister.
This particular price-setting method involves setting an access price based on SA Water’s prices for retail services plus any facilitation costs minus an amount that SA Water could avoid (over the long term) in providing access.
Access regime reviews
Under section 86ZR of the Water Industry Act 2012, the Commission must conduct a review of the water infrastructure and sewerage infrastructure subject to Part 9A and form a view as to whether or not the access regime should continue from 30 June 2024 for a period of five years.
The Commission’s final report setting out the review’s conclusions and recommendations must be provided to the Minister for Climate, Environment and Water. The decision to continue operation of the access regime rests with the Minister.
Please refer below for further information about the reviews.
2023 Review of the water third party access regime
The Commission has commenced its periodic five-year review into whether or not the third-party access regime that applies to the South Australian water industry should continue from 30 June 2024 for a period of five years.
2019 Review of the water third party access regime
The Commission made a recommendation to the Minister for Environment and Water, which was accepted, to continue the access regime from 1 July 2019 for a further five years. The Commission welcomes, at any time, views from access seekers and other interested parties regarding the access regime, which may feed into the next review which is due in 2024.