Reports say there could be a massive bill for no real gain from Sydney’s privatised desalination plant, which currently sits idle.

An investigation has claimed that the desalination plant at Kurnell is costing residents more than $500,000 a day to keep on standby, but may not need to be used for at least another five years.

If the figures are correct, the $2.3 billion sale of the plant to a private company means residents will continue to pay fees for the next 50 years, whether the plant operates or not. Estimates suggest this will total about $10 billion.

Dam levels in the area sit at just over 93 per cent capacity, meaning the Kurnell plant has been placed into ‘water security’ mode – a long-term shutdown while conditions are still acceptable. Sydney Water's managing director Kevin Young says: “My best estimate is it will still be about four to five years before we turn the desalination plant on.”

The meter is still running for residents though, with the plant asking an alleged ‘availability charge’ of $500,000 per day.

“We pay an availability charge whether we use water or not. That is equivalent to around $200 million a year,” Mr Young said.

Just before the plant was put into ‘water security’ mode last year, it was sold to private concerns in a 50-50 split between investors Hastings Funds Management and the Ontario Teachers' Pension Plan, based in Canada. Under the current fees the backers are guaranteed inflation-linked payments of $10 billion from Sydney Water.

NSW Opposition treasury spokesman Michael Daley says the public asset has become a cash cow for private holders.

Fees are set by the state's Independent Pricing and Regulatory Tribunal (IPART), and are designed to ensure that the private owners get a return on their investment regardless of whether the plant is running.

When the plant was switched off, its owners were paid a ‘shutdown fee’ of $1.5 million. When it is switched back on again, they will get a ‘restart fee’ of $5.5 million.

Sydney Water says the sale has not impacted the bottom line on water bills, just changed where ratepayers’ money actually ends up.

“Customers are probably paying around $100 a year for the desalination plant as part of their bill... there's no difference to what customers pay whether it's the State Government that owns the plant or the private sector,” Mr Young said.