Water prices will rise 8.3 per cent for Lachlan Valley irrigators while the Independent Pricing and Regulatory Tribunal (IPART) reviews a WaterNSW proposal for a 53 per cent increase in revenue for its services.
According to IPART, the typical farmer with a 500 ML general security licence in the Lachlan Valley will pay $1086 more on WaterNSW bills next year.
NSW Irrigators Council CEO Claire Miller said it was disappointing that IPART had shifted from the 1.9 per cent plus CPI price rise proposed in its information paper last month.
“This is disheartening for farmers across NSW whose hopes were raised that their bills would remain manageable for the next 12 months while they are under pressure with surging input costs, high interest and the impact of flooding and looming drought,” Ms Miller said.
Tribunal Chair Carmel Donnelly said WaterNSW originally proposed a significant increase of 53 per cent in revenue for its services to rural valleys over 2025 to 2030, which would require large price rises for customers if approved.
However, at this stage, the Tribunal says more assessment is needed to determine how much of any efficient increases should be passed on to customers.
“IPART does not have flexibility to extend the timeline for this pricing review," Ms Donnelly said.
"New prices must be in place by 1 July 2025 to ensure consumer protection.
"By making a one-year determination the Tribunal has ensured new prices will take effect by 1 July 2025 as required, also providing an interim period for IPART to fully investigate the large increases proposed by WaterNSW and the matters raised by stakeholders in our consultation."
Our region's irrigators had warned the proposed price hikes would be enough to put food producers out of business.
Representative organisation Lachlan Valley Water says in their submission that the average Australian irrigator is already at financial breaking point due to regulations and the associated costs.
The rising cost of irrigated water in NSW has become a pressing issue for the state’s agricultural sector, which relies heavily on affordable and reliable water access to produce food and fibre for the nation.
“Every increase in water costs and every restriction on access threatens to weaken the food supply chain and drive up food prices for consumers,” Lachlan Valley Water’s submission to the proposed pricing scheme said.
They've now expressed disappointment that IPART has essential “caved” to WaterNSW with an 8.3 per cent price hike for Lachlan Water Users for the next 12 months, despite overwhelming submissions supporting IPART’s draft determination of 1.9 per cent.
"We now have significant concerns as to what 1 July 2026 will look like given that the 8.3 per cent increase will be the new baseline from 1 July 2025," Lachlan Valley Water executive officer Glenn Daley said.
"The entire water management system is completely broken and we are calling for an urgent and far-reaching review.
"We are concerned that 12 months won’t allow for any significant deep-dive, and that any review performed during that time will be perfunctory."
Ms Donnelly thanked all stakeholders for providing feedback to IPART.
“Our one-year determination will allow a modest increase in revenue for WaterNSW, while limiting bill impacts for customers compared to the revised 25 per cent before inflation increase in prices in 2025-26 sought by WaterNSW in its submission to the IPART’s recent Information Paper.”
Ms Donnelly said the Tribunal would begin its next review of maximum prices for WaterNSW bulk water services for rural valleys immediately.
The review will include publication of a draft report and draft determination, a public hearing and a final report.
While WaterNSW will not need to submit a new pricing proposal, IPART will require WaterNSW to provide additional information to inform the review.
Ms Miller said while the price increases were disappointing, IPART had at least gone part of the way highlighting the need to address government inefficiencies to avoid exorbitant price proposals in future.
“WaterNSW’s pricing proposal was for an annual average hike of 25 per cent plus CPI each year for the next three years, to cover costs to deliver water to customers and other licence obligations,” Ms Miller said.
“Clearly price increases of that magnitude would price our farmers out of business and local NSW food off supermarket shelves. The cost drivers must be addressed."
Ms Miller warned the NSW Government must ensure WaterNSW can continue to deliver essential services and infrastructure works while the Government and IPART review the pricing model and corporate structures.
“If WaterNSW is right about its long-term cost needs because there are business sustainability issues, that is a problem. If they are wrong, this is also a problem.
"IPART needs to get to the heart of the truth to ensure reasonable and affordable water charges for farmers.”
IPART’s Final Report is available from www.ipart.nsw.gov.au