The Australian Competition and Consumer Commission has released its draft decision on the charges that Water NSW is able to levy for infrastructure services in the Murray-Darling Basin during 2015-16. This is the first annual review of charges conducted by the ACCC.

Last year, the ACCC set the methodology for calculating Water NSW’s 2015-16 charges. The Water Charge (Infrastructure) Rules 2010 limit the ACCC’s ability to vary the charges through the annual review to circumstances where it is reasonably necessary to do so, having regard to Water NSW’s forecasts, and/or price stability.

"A range of factors are influencing prices in the Murray-Darling Basin, primarily low water availability in 2014-15. This has led to some increases in charges in some valleys," ACCC Chairman Rod Sims said.

"The ACCC’s draft decision has considered updated forecasts for demand and will make an adjustment to the charges that Water NSW can levy as a result."

"However, following consideration of the likely effect of the charge increases on customers, the ACCC concluded that the ‘price stability’ test has not been satisfied and so the ACCC is not further varying the charges," Mr Sims said.

The draft decision is to set the charges in accordance with the 2014 decision, with some adjustments to take account of updated forecasts not previously provided to the ACCC.

The ACCC anticipates that its draft decision will increase Water NSW’s bills for customers in the Border, Peel, Lachlan, Macquarie, Lowbidgee and Fish River valleys. Bills for customers in other valleys will either fall or remain at 2014-15 levels.

The ACCC is seeking submissions on its draft decision by 5pm on Wednesday 6 May 2015.

Following consultation on this draft decision, the ACCC intends to make its final decision on Water NSW’s 2015-16 charges by 12 June 2015. Water NSW’s application for review of its charges and the ACCC’s draft decision are available on the ACCC website.

Water NSW is the result of the merger between State Water and the Sydney Catchment Authority in January 2015.

The ACCC set the methodology for calculating Water NSW’s (then State Water) prices for 2015-16 and 2016-17 in its final decision on Water NSW’s charges for the 2014-17 regulatory period.

This decision is available at: Water NSW (formerly State Water): annual price review 2015-16