The ongoing strife with the construction of Victoria’s Wonthaggi desalination has seen Melbourne Water attempt to recoup $306 million in lost funding by upping charges to customers.

 

“We understand that customers are concerned about the over recovery of desalination funds in 2011-12 to 2012-13 due to delays in the completion of the Victorian desalination plant, and are keenly interested in how this money will be returned,” the company said in a statement.

 

The company defended the move to recoup the funds, saying it was following a previously agreed upon procedure with the previous State Government.

 

“Prices for the current Water Plan period (2009-10 to 2012-13) were set by the Essential Services Commission in June 2009 based on the best information available. At that time, the desalination contract between the Government and Aquasure had not been finalised and construction of the plant had not started.”

 

The issue surrounding the recouping of funding first arose when the company released its Melbourne Water Draft Water Plan, which found that the construction of the strife-ridden Wonthaggi desalination plant had significantly contributed to a costing blowout. 

 

 

The company has announced plans to return funds to its customers by lowering its prices over the five year period between 2013-2018, including inflation and interest.

 

“We have proposed a wholesale price of CPI+30.8% in 2013-14 and then CPI-1% for each of the following four years. This will translate to customers’ bills increasing by no more than CPI from 2014/15,” the company said in its statement.

 

The draft plan can be found here

http://www.melbournewater.com.au/content/about_us/customers_and_prices/draft_2013_water_plan.asp