GIPPSLAND Water’s proposed increases in water prices have been rejected by Victoria’s independent economic regulator, the Essential Services Commission.
Gippsland Water’s customers currently pay the highest water bills in Victoria, with the average bill for 2012-2013 at $1236, compared with $956 for South Gippsland Water and $774 for Lower Murray Water.
Under Gippsland Water’s proposed charges the average customer in the largest town serviced would have paid $1249 for 2013-14 and $1298 for 2017-18.
Coliban Water proposed to raise its charges to $1256 for 2017-18 from $1003 this financial year, to make it the most expensive in five year’s time.
The ESC announced on Tuesday it would not approve the price increases.
Releasing the Regional Urban Water Businesses Price Review 2013 draft decision, commission chair Ron Ben-David said that, with one exception, all Victoria’s water businesses had sought increases ranging from about one per cent to 28 per cent during the five years to June 2018.
Wannon Water had proposed a 3.4 per cent reduction.
“We found these price increases were not supported by our independent analysis of the 12 businesses’ plans for the next five years,” Dr Ben-David said.
Dr Ben-David said that while the water businesses had proposed prices intended to generate revenues of $4.2 billion during the next five years, the commission was proposing to reduce this amount by $185 million.
The lower revenue requirement would directly benefit customers through lower water bills.
Dr Ben-David said the commission sought business and community input into its analysis and had used the technical expertise of external consultants in an attempt to ensure that the costs passed onto customers were fair and reasonable.
Service levels are expected to be maintained over the period.
A Gippsland Water spokeswoman said the business was thoroughly reviewing the draft decision.
“The ESC is seeking comment from Gippsland Water and the general public on its draft decision, that must be submitted before May 2.
“Following its detailed analysis, Gippsland Water will be in a position to respond to the ESC by the May deadline,” she said.
Each water business is required to have financial hardship policies in place to help those struggling to pay their water bills.
For more read Friday’s Gippsland Times.