May 2013

Alluvium Melbourne seeks regional manager

21.05.2013 - Posted by Kane Travis
We are searching for a Regional Manager to lead our Victorian business. The role based in Melbourne and reporting to the CEO, has overall management responsibility for a team of over 20 professional engineers and scientists working in the river health, urban water and NRM sectors.

The position will play a critical role in further developing our business vision and guiding the entity into the future. The role has a high level of interaction with other Regional Managers, CEO and the Alluvium Board. The role requires a division of time between managing the Victorian business, and delivery of consulting services in areas of technical competence.

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The economics of stormwater

16.05.2013 - Posted by Dan O'Halloran
Stormwater Victoria’s annual conference was held recently at the Bayview Eden Hotel in Melbourne. The presentations ranged from technical, across environment and society, to economics as the industry grapples with a range of drivers guiding recent work. One of the main areas of interest for the industry recently has been how to build the business case for the delivery of integrated water services in a way that will satisfy the State’s economic regulator. 

My conference highlights included a presentation from the Office of Living Victoria discussing ‘shadow pricing’ for water, wastewater and stormwater services. A ‘shadow price’ estimates the cost of providing these services and illustrates the variation in that cost spatially across Melbourne. It aims to include life cycle costs, including future infrastructure requirements. This is useful when comparing conventional with alternative systems. While the price itself would be a useful indicator of viability, of greater importance is the robustness and transparency of the models and its assumptions if it’s to gain industry acceptance.

The role of water in liveability and measurement of benefits continues to present a complex problem. It was timely for the forum to hear economist David Pannell from the University of Western Australia discussing the relative merits of evaluation methods and the common pitfalls for engineers. For an area where on-ground data is hard to come by, David reminded us that the community’s perception of value is a valid starting point when dealing with the questions surrounding integrated water service delivery and liveability.

Another highlight was hearing about the Bolin Bolin Billabong (Bulleen, Melbourne) project, which aims to use stormwater to improve the health of the billabong by achieving multiple positive social and environmental outcomes. We learned that, despite the best efforts of the project team, the stormwater harvesting element had been removed (in favour of river water) due to sufficient recent rainfall. It was a good reminder of the importance of retaining flexibility in integrated water management systems to ensure they can deliver over the longer term given likely changes in climatic, social and economic conditions to avoiding costly retrofits in the future.

Bolin Bolin Billabong sourced from

Dollars and sense

3.05.2013 - Posted by Rob Catchlove
Last Tuesday (23 April 2013) the Essential Services Commission (ESC) released a draft decision on the price review process for the metropolitan water businesses for Melbourne. This covers Melbourne Water, City West Water, Yarra Valley Water, South East Water and Western Water.

Every five years, water businesses submit a request for prices that, once approved, govern how much our water bills are and what they will spend the money on. On 1 July, the next five year period commences.

The price review decision from the ESC was that the metropolitan water businesses were asking for too much and needed to cut back. And when I say cut back, the retail businesses ‘lost’ $793 million from their claim for a combined revenue of $12,266 million over five years. And Melbourne Water ‘lost’ $489 million and was approved revenue of $8,123 million over five years. I say lost in inverted commas because if it wasn’t raised in the first place, it isn’t really lost!

The desalination plant makes up 36 per cent of the operational costs that Melbourne Water needs to cover over the next five years (and thus requires in revenue).  We can now safely say that Melbourne is paying $593 million a year as insurance for our water supply. The merits of this insurance probably need another blog (or book).

From an initial glance, I don’t think there are substantial implications for the cut back to revenue that the ESC has recommended. Normally it might result in less capital works, less maintenance, or reduced targets (which translates into a reduced level of service or reduced ambition for environmental protection). But when you take desalination out of the equation, and note that there are probably efficiencies, delayed capital works and reduced borrowing rates, there is still scope to do creative and innovative things that will keep Melbourne moving towards a resilient and sustainable water system and ultimately a liveable city.

Either way, water business is big business.

Wonthaggi desalination plant