Review of prices for the Water Administration Ministerial Corporation

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O Impact of changes to the cost allocation method, entitlement volumes and usage volumes on bills and prices in 2013/14 Usage charges rise from $2.47 in 2009/10 to $3.21 in 2013/14 (an increase of 30%). Key drivers of price changes (other than the increase in the user share of revenue): The change in cost allocation methodology has resulted in an extremely large increase in the costs allocated to the Murrumbidgee. Decreased entitlement volumes have contributed to the considerable increases in fixed charges. A decrease in forecast usage has contributed to the increase in usage charges. The bill cap has been applied in the all 3 years of the determination, reducing forecast bills for 2013/14 by 35%. This has mitigated the impact of price increases on customers, with prices slowly transitioning to higher levels. Groundwater Prices and forecast bills: Forecast bills rise from $1.84 in 2009/10 to $3.19 in 2013/14 (an increase of 73%). Fixed charges rise from $1.24 in 2009/10 to $2.23 in 2013/14 (an increase of 80%). Usage charges rise from $0.61 in 2009/10 to $0.96 in 2013/14 (an increase of 57%). Key drivers of price changes (other than the increase in the user share of revenue): The drivers of price changes in Murrumbidgee are the same as for all other users in inland groundwater valleys. However, due to the low charges set for Murrumbidgee in the 2006 Determination, the bill cap has been applied in all 3 years of the determination. This has reduced forecast bills by 49% in 2013/14. O.5.9 North Coast Regulated Rivers Prices and forecast bills: Forecast bills rise from $3.17 in 2009/10 to $5.48 in 2013/14 (an increase of 73%). Fixed charges rise from $2.99 in 2009/10 to $5.04 in 2013/14 (an increase of 68%). Usage charges rise from $2.01 in 2009/10 to $4.99 in 2013/14 (an increase of 149%). Key drivers of price changes (other than the increase in the user share of revenue): The change in cost allocation methodology has dramatically reduced the costs to be recovered from users in the North Coast valley. However, as this valley had an extremely low level of cost recovery during the previous determination, prices will still increase. 340 IPART Review of prices for the Water Administration Ministerial Corporation
O Impact of changes to the cost allocation method, entitlement volumes and usage volumes on bills and prices in 2013/14 Usage charges have been marginally affected by a reduction in usage forecasts, but the substantial increase over the course of the determination is due to the increased costs to be recovered. The bill cap has been applied in all 3 years of the determination, reducing forecast bills in 2013/14 by 19%. Unregulated Rivers Prices and forecast bills: Forecast bills rise from $6.87 in 2009/10 to $9.02 in 2013/14 (an increase of 31%). Fixed charges rise from $4.14 in 2009/10 to $6.32 in 2013/14 (an increase of 53%). Usage charges fall from $2.73 in 2009/10 to $2.71 in 2013/14 (a decrease of 1%). Key drivers of price changes (other than the increase in the user share of revenue): Forecast bills are increasing mainly due to the low level of cost recovery achieved during the last determination (68% in 2009/10). The change in cost allocation methodology has resulted in a slight reduction in the costs allocated to the North Coast unregulated valley. This has acted to limit the increase in forecast bills. A slight increase in entitlement volumes in the North Coast has placed downward pressure on fixed charges, and the upward revision of usage forecasts has also placed downward pressure on usage charges. The bill cap has not been applied to this valley. Groundwater Prices and forecast bills: Forecast bills fall from $6.82 in 2009/10 to $5.33 in 2013/14 (a decrease of 22%). Fixed charges fall from $4.55 in 2009/10 to $3.67 in 2013/14 (a decrease of 19%). Usage charges fall from $2.27 in 2009/10 to $1.67 in 2013/14 (a decrease of 27%). Key drivers of price changes (other than the increase in the user share of revenue): Coastal valleys have been allocated a substantially smaller proportion of costs as a result of the change in cost allocation methodology. In addition, increases in both entitlement volumes and usage forecasts have led to substantially lower fixed and usage charges, respectively. As a result, the bill cap has not been to coastal valleys applied in any year of the determination. Groundwater licence holders in coastal valleys will see the largest reduction in their forecast bills of any group of users over the course of the determination. Review of prices for the Water Administration Ministerial Corporation IPART 341
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Independent Pricing and Regulatory
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© Independent Pricing and Regulato
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Contents 5 Share of NOW’s total e
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1 Executive summary 1 Executive sum
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1 Executive summary IPART has decid
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1 Executive summary Table 1.2 Unreg
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1 Executive summary In setting the
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1 Executive summary 1.3.1 Increases
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1 Executive summary 1.3.2 Increases
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1 Executive summary Increases in
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1 Executive summary 1.3.5 What are
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1 Executive summary Figure 1.1 Deci
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1 Executive summary undertaken co
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2 Overview of the approach we used
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5 Share of NOW’s total efficient
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6 Price Structure 6 Price Structure
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6 Price Structure 6.2 Geographic sp
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6 Price Structure Table 6.1 below s
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6 Price Structure The sections belo
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6 Price Structure 6.3.3 IPART’s a
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6 Price Structure We note that this
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6 Price Structure 6.4 The price pat
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6 Price Structure is expected to be
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6 Price Structure $60 doesn’t c
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6 Price Structure 6.6.1 Stakeholder
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6 Price Structure In summary CIE co
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6 Price Structure At the Sydney pub
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7 Allocation of the user share acro
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8 Entitlement volumes and usage for
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9 Water management prices Chapter 1
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9 Water management prices Table 9.1
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10 Meter service and reading charge
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Table 10.3 NOW’s estimated annual
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11 Consent transaction charges 11 C
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Table 11.7 NOW’s estimated hours
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Table 11.9 NOW’s forecast transac
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11 Consent transaction charges NOW
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A List of appendices A List of appe
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B Summary of NOW’s submission to
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C Cost shares adopted by IPART C Co
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D Illustrative example of cost allo
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E Cost recovery by valley E Cost re
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F Consideration of Water Charge (Pl
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G Consideration of IPART Act sectio
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H Summary of IPART’s response to
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Issue IPART response Review of pric
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Review of prices for the Water Admi
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Review of prices for the Water Admi
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I Impact of decisions on consolidat
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