Melbourne Water Price Review – draft decision

ESC – Essential Services Commission of Victoria

Mar 18
Melbourne Water Price Review – draft decision

On 11 March 2016, the Essential Services Commission (ESC) published its draft decision on Melbourne Water’s price review (2016-2021).

The ESCs draft decision reduces Melbourne Water’s revenue requirement over the regulatory period down $92m (1.2%) to $7,762.8m down from the $7,854.7m proposed .  The reductions to underlying building block elements are summarised below:

  • Forecast operating costs – reduced by $112.4m (2.4%) from $4,690.9 to $4,578 – main reductions were in the forecast cost of energy, chemicals and fleet.  The ESC did acknowledge the savings already identified by Melbourne Water from the 2014 Efficiency Review.
  • Forecast capital costs – reduced by $355.05m (13%) from $2,672m to $2,316m – main reductions were to capital project expenditure for sewerage, waterways and drainage projects.

Interested parties have until 26 April 2016, to respond to the draft decision and the ESC will also hold a public forum in April to explain its decision.