20 February 2014

Hon Mark McArdle the Qld Minister for Energy and Water Supply presented to an AWA Breakfast on 19 Feb 2014. http://wp.me/p2g64Q-2x The following is my understanding and commentary.

Strategy – The 30 yr Water Strategy is aimed at providing a blueprint with a clear vision for the Water Industry moving forward. It is intended that it will be renewed every five years and all identified actions will be reported to the public on a six month basis.  It is currently being aligned with the draft State Plan and is expected to be released shortly with a consultation period, before coming into effect in July this year.

Growth – The QLD State plan calls for an increase in population of 3M people over the next 30 years. That plan looks to have 50% of that increase outside of South East Queensland. That will not be sustainable for the water sector. The growth rates can be achieved, but the majority of the growth will need to occur in the current SE, where the water infrastructure has been developed and substantial capacity exists.  To provide for this level of growth outside the existing SE would required substantial investment by the regional Water Service Providers which would not be economically sustainable without government support.

Regional Water Development – Currently 2/3 of the State of QLD is under drought conditions. The federal government has expressed interest that the north of Australia becoming the food bowl of ASIA. This is not viable without a large degree of water resources infrastructure development in the north of QLD. Planning still needs to be undertaken but it is expected that any future large spending in the water sector in QLD will be federal money in these regional areas.

SEQ Water Development – Seqwater has commenced a two year planning strategy for the 30 year water needs for South East Queensland. Whilst the current SE water grid provides good security of supply, several components arose from poor planning practises during the Millennium Drought, resulting in higher than optimal costs. The planning during that period is currently the focus of a parliamentary enquiry due over the next couple of months.

Water Customers – The development of flexible communication style (think mobiles) charging plans is desirable for the water sector. Different user groups may need different quality & quantity of water, for different uses, at different rates. Examples may include high use gardening or agricultural users. The strategy will provide for hardship, set customer service standards and provide for the extension of the Water & Energy Ombudsman across the state.

Efficient Water Usage – The state plan calls for the doubling of farm output by 2040. This will require improvements to the water usages within the rural areas. There will be an expansion of “fit for purpose” water, including the reduction of the current “red tape” on recycled water schemes.

Responsible Water Management – Eight irrigation schemes are currently being returned to local control, with the expectation that they will have an improved management, at a lower cost. With the reduction of the “red tape” and the introduction of outcome based KPI’s for water service providers, concerns may arise as to appropriate measurement of “responsible water management”

Skills for the future – Appears to promote general management skills into the water sector. Skills such as Information & data management, economics and business management were mentioned. An expansion of the current Q-Wrap program, with the view to improve and share top management in regional areas was announced.

SMART Regulation & Private Sector Involvement – The continuation of catchment based approaches, the release of the current water services legislation and alterations to the recycled water regulations were mentioned as SMART regulations. Partnerships between government, water service providers and the private sector will be encouraged by the government, whilst recognising that they do not have jurisdiction across many of these relationships.

Innovative Technologies – Several technology based innovations were mentioned including smart meters. The formation of a Industry Lead Innovation Panel was announced.

Whilst no new unexpected issues were announced by the Minister, the 30 yr Water Strategy now appears to be aligned with the state plan and reported through six monthly action plans. Much of the plan will be rural and regional area based with less impact on the urban water sector. The success or failure of the plan will be determine by the implementation plan and the allocation of responsibility across government, water service providers and the industry as a whole. We wait with anticipation the release of the strategy.

This review was prepared by David Nixon of Better Managed, Management Consultants to the Water Industry and chair of AWA’s QLD policy and strategy committee. They are David’s views only which he would be happy to discuss. Davidn@bettermanaged.com.au