Water charge rules for charges payable to irrigation infrastructure operators and bulk water operators, position paper—September 2008

The Australian Competition and Consumer Commission (ACCC) has released its position paper seeking submissions on the development of bulk water charge rules. The paper presents the ACCC’s preliminary positions on water charge rules for irrigation infrastructure operators (access charges) and bulk water operators within the Murray‑Darling Basin.

Consistent with Part 4 of the Water Act 2007, the Minister for Climate Change and Water, Senator Penny Wong, has written to the ACCC requesting advice on the water charge rules.

Water charge rules applied consistently across the Murray-Darling Basin will facilitate the efficient functioning of water markets by removing distortions to trade and by sending signals to water users about efficient investment in water infrastructure assets. Water charges based on the full cost recovery for water services will contribute to achieving an economically efficient and sustainable use of water resources and water infrastructure assets.

To date, the ACCC’s development of advice on water charge rules has progressed through separate consultation processes relating to rules for charges payable to irrigation infrastructure operators and rules relating to bulk water charges. The ACCC has released two issues papers for consultation:

• an issues paper on water charge rules for charges payable to irrigation infrastructure operators on 30 May 2008
• an issues paper on bulk water charge rules on 7 July 2008.

The two consultation processes have been brought together as a result of changes that are to be made to the Water Act following the Intergovernmental Agreement on Murray-Darling Basin Reform agreed by the MDB states on 3 July 2008. As a result of the proposed changes to the Water Act, the same regulatory options will be available for water charges payable to both bulk water service providers and to irrigation infrastructure operators. The position paper below brings together these two processes and is the next step in the consultation process following the issues papers.