This report examines whether the Department of Planning, Industry and Environment, and Sydney Water have effectively progressed water conservation initiatives in Greater Sydney.
The report found that the department and Sydney Water have not effectively investigated, implemented or supported water conservation initiatives in Greater Sydney. The agencies have not met key requirements of the current Metropolitan Water Plan and Sydney Water has not met all its operating licence requirements for water conservation. There has been little policy or regulatory reform, little focus on identifying new options and investments, and limited planning and implementation of water conservation initiatives.
As a result, Greater Sydney's water supply may be less resilient to population growth and climate variability, including drought.
The Metropolitan Water Plan states that water conservation, including recycling water, makes the drinking water supply go further. The plan also states that increasing water conservation efforts may be cheaper than building new large-scale supply options and can delay the timing of investment in new supply infrastructure.
The Auditor-General recommends the department develop a clear policy and regulatory position on water conservation options, improve governance and funding for water conservation, and work with Sydney Water to assess the viability of water conservation initiatives. The report also recommends improvements to Sydney Water’s planning for and reporting on water conservation, including the transparency of this information.
This report is part of a multi-volume series on the theme of water. Refer to ‘Support for regional town water infrastructure’ and ‘Water management and regulation – undertaking in 2020-21’.
The current, 2017 Metropolitan Water Plan states that water conservation, including recycling water, makes the drinking water supply go further. The plan also states that increasing water conservation efforts may be cheaper than building new large-scale supply options and can delay the timing of investment in new supply infrastructure.
Water conservation refers to water recycling, leakage management and programs to enhance water efficiency. Water recycling refers to both harvesting stormwater for beneficial use and reusing wastewater.
This audit examined whether water conservation initiatives for the Greater Sydney Metropolitan area are effectively investigated, implemented and supported. We audited the Department of Planning, Industry and Environment (the Department) and the Sydney Water Corporation (Sydney Water), with a focus on activities since 2016.
The Department is responsible for the integrated and sustainable management of the state’s water resources under the Water Management Act 2000, which includes encouraging ‘best practice in the management and use of water’ as an objective. The Department is also responsible for strategic water policy and planning for Greater Sydney, including implementing the Metropolitan Water Plan.
Sydney Water is a state-owned corporation and the supplier of water, wastewater, recycled water and some stormwater services to more than five million people in Greater Sydney. It is regulated by an operating licence that is issued by the Governor on the recommendation of the Independent Pricing and Regulatory Tribunal (IPART). The Tribunal determines Sydney Water’s maximum prices, reviews its operating licence and monitors compliance. Sydney Water's operating licence and reporting manual set out requirements for its planning, implementing and reporting of water conservation.
From 2007 to 2012, the Climate Change Fund was a source of funds for water conservation activities to be undertaken by the Department and Sydney Water. The Climate Change Fund was established under the Energy and Utilities Administration Act 1987. Four of its six objectives relate to water savings. Water distributors such as Sydney Water can be issued with orders to contribute funds for water-related programs. The Fund is administered by the Department.
In 2016, Sydney Water developed a method for determining whether and how much to invest in water conservation. Known as the ‘Economic Level of Water Conservation’ (ELWC), the method identifies whether it costs less to implement a water conservation initiative than the value of the water saved, in which case the initiative should be implemented.
The Department and Sydney Water have not effectively investigated, implemented or supported water conservation initiatives in Greater Sydney.
The agencies have not met key requirements of the Metropolitan Water Plan and Sydney Water has not met all its operating licence requirements for water conservation. There has been little policy or regulatory reform, little focus on identifying new options and investments, and limited planning and implementation of water conservation initiatives.
As a result, Greater Sydney's water supply may be less resilient to population growth and climate variability, including drought.
The Department has not undertaken an annual assessment of Sydney Water’s level of investment in water conservation against water security risks and the capacity to respond when drought conditions return, as required by the Metropolitan Water Plan. It did not complete identified research and planning activities to support the plan, such as developing and using a framework for assessing the potential for water conservation initiatives for Greater Sydney, and developing a long-term strategy for water conservation and water recycling. It also did not finalise a monitoring, evaluation, reporting and improvement strategy to support the plan.
Sydney Water has been ineffective in driving water conservation initiatives, delivering detailed planning and resourcing for ongoing initiatives, and in increasing its investment in water conservation during drought. These were requirements of the Metropolitan Water Plan. Sydney Water's reporting on water conservation has not met all its operating licence requirements and lacked transparency with limited information on key aspects such as planning for leakage management, how the viability of potential initiatives were assessed, and how adopted initiatives are tracking.
The Department and Sydney Water did not put in place sufficient governance arrangements, including clarifying and agreeing responsibilities for key water conservation planning, delivery and reporting activities. There has also been limited collaboration, capacity building and community engagement to support water conservation, particularly outside times of drought.
The Department and Sydney Water have not identified clear responsibilities nor established formal arrangements that support planning, implementation, reporting and capacity for water conservation. This is despite reviews of previous metropolitan water plans by the Department and reviews by IPART highlighting weakness in water resource management in general, and specifically for water conservation.
Frequent structural changes in the Department and staff turnover have limited its ability to support water conservation and lead policy and regulatory reform. Between August 2005 and July 2019, the function changed departments six times and was split on two occasions into separate offices before being re-merged.
The Department has not undertaken detailed analyses of a range of water conservation options since 2013. Limited progress has been made to address evidence gaps related to the full range of costs and benefits of water conservation. The Department was required to undertake research activities to inform the Metropolitan Water Plan, but not all of these were completed. This has hampered the Department's ability to provide policy guidance and support Sydney Water's water conservation activities.
Sydney Water has developed the Economic Level of Water Conservation (ELWC) method to assess the costs and benefits associated with water conservation initiatives but has not applied the method to a detailed assessment of a broad range of water conservation options and their potential for Greater Sydney.
The Department does not have a documented strategy for water conservation in Greater Sydney, even though this was a requirement in developing the Metropolitan Water Plan. The Department also does not have an approach for supporting Sydney Water’s water conservation programs.
The Department and Sydney Water have struggled to fund water conservation initiatives. Funding for water efficiency programs was scaled back when Sydney Water was not required to contribute to the Climate Change Fund between 2012–13 to 2016–17. Both the Department and Sydney Water were using the fund to resource their water conservations activities.
Further, Sydney Water did not request funding for water conservation in its 2015 price submission to IPART, for water pricing from 2016 to 2020, even though it needed resources to develop and implement its ELWC methodology as required under its operating licence. Sydney Water requested funding in its latest submissions to IPART. In its June 2020 pricing determination IPART allowed this.
Under its operating licence Sydney Water should have developed a water conservation program consistent with its ELWC methodology by September 2017 but did not do this. While its water conservation activities are outlined in its annual water conservation reports, these lack information on objectives, strategies and targets. Most of its leak management activities have not been included in its reported forward program.
There are also anomalies in the way that Sydney Water has assessed the economic viability of water conservation projects using its ELWC method. This includes anomalies in the way it is valuing water, especially at lower dam storage levels, and irregularities in the way it has been costing potential water conservation initiatives. This creates a risk that some initiatives that could have been viable were assessed as uneconomic, and vice versa.
Sydney Water's lack of planning led to its water conservation initiatives being limited and not timely in response to the recent drought. The Metropolitan Water Plan required that the ELWC method should result in increased investment in water conservation during drought. Sydney Water should have increased its water conservation investments as dam levels dropped from 2017 but it did not start to do so until May 2019 through drought funding and funds sourced from the Climate Change Fund.
Sydney Water recorded in its Water Conservation Program Control Board minutes in May 2019 that, 'the ELWC has not been applied in 2016 to 2020, no budget was allowed, and no mechanism was enacted.'
Sydney Water provides some analysis of water savings and costs in its water conservation reports. However, there has been limited evaluation of the success of its initiatives. Variations between expected and actual water savings are not explained. This makes it difficult to gauge the impact of water conservation, changes in initiatives and investments, and scope for improvement. Sydney Water does assess customer satisfaction with its efficiency initiatives.
Some water efficiency initiatives that were economically efficient were not included in Sydney Water's 2017–18 and 2018–19 programs. It did not provide information in its water conservation reports on initiatives identified as economically efficient but not implemented, even though this was a reporting requirement of its operating licence.
The Department has not done annual assessments on the level and appropriateness of investment in water conservation, despite this being an expectation under the Metropolitan Water Plan.
The Department has not made substantial progress to remove or coordinate a response to reported policy, regulatory and institutional barriers to water recycling and stormwater harvesting. These water conservation approaches are necessary to meet Greater Sydney's growing water needs and build resilience to drought. Investigations to understand and identify potential solutions to some of these barriers, particularly in growth areas in Western Sydney, have been led by Infrastructure NSW.
Also, the Department has not undertaken the community engagement required by the Metropolitan Water Plan to understand whether highly treated recycled water may be a future option for potable (drinking) water. The Department has not reviewed the costs and benefits of the 2008 NSW Government Direction to set developer charges for traditional water and wastewater servicing to zero. By comparison, charges are levied for recycled water schemes making these less attractive to developers.
Sydney Water has not expanded its water recycling capacity in over eight years. It assessed the viability of one major recycling scheme in 2019, and the options were found to be 15 to 40 per cent more expensive than traditional water and sewer services. Sydney Water advises it is currently considering a range of the other recycling schemes.
The Department has an administrative role in the Building Sustainability Index (BASIX) and the National Australian Built Environment Rating System (NABERS), which are measures that can encourage more efficient water use in residential and commercial buildings.
The Department reviewed BASIX in 2013 and recommendations to increase water targets were not adopted by the NSW Government. With changes in technology and the evidence-base for water conservation since that time, there may now be potential to enhance BASIX by revisiting water saving targets, recycling initiatives and the use of rainwater tanks.
The Department has not developed policy, engaged the community, and consolidated an evidence-base around water conservation. As such, opportunities have been missed for the Department to support Sydney Water’s water conservation initiatives, and to engage directly with the community on opportunities to save water.
Sydney Water has not maintained baseline funding for its water conservation program, particularly outside times of drought.
By July 2021:
- The Department should develop a clear policy and regulatory position on:
- water efficiency - reducing water demand through programs that aim to increase water efficiency and change behaviour
- potable water reuse - engaging with the community to understand whether highly treated recycled water can be considered as a future option for drinking water
- water recycling - addressing reported barriers such as developer chargers and improved access to planning and land release processes for private water utilities
- stormwater harvesting - enhancing cooperation between State and Local Government, Sydney Water and private water utilities.
- The Department should establish clear mechanisms to ensure water conservation is treated explicitly in the management of Greater Sydney's water resources, including:
- establishing formal governance arrangements to assist in developing and implementing Sydney Water’s planning and reporting for water conservation
- establishing roles and responsibilities for water conservation research, planning and implementation, and engaging Sydney Water, IPART and other agencies in this activity
- evaluating progress with the Greater Sydney Water Strategy, including annual reviews of the level of investment (by the Department and Sydney Water) in water conservation.
- The Department should determine and implement a practical mechanism for funding water conservation initiatives in Greater Sydney including:
- ensuring the Climate Change Fund is being used to effectively fund water saving initiatives
- identifying and assessing other funding mechanisms for water conservation, including resourcing for research and development.
- The Department, working with Sydney Water, should assess the viability of current and future water conservation initiatives, including:
- commissioning a detailed options study to inform a water conservation program
- applying an evidence-driven method to assess water efficiency and leakage management initiatives, and water recycling schemes
- reviewing BASIX including water savings targets, program design and implementation.
- Sydney Water should develop and implement a rolling detailed five-year plan for water conservation with clear objectives that, at a minimum meets the requirements of the Greater Sydney Water Strategy and its operating licence, including:
- establishing baseline funding and resourcing for water conservation including research and pilots
- reviewing, in conjunction with IPART, the ELWC methodology and the way it is being applied
- developing and maintaining relationships with sector specialists, businesses and government
- detailing how its individual initiatives will be implemented.
- Sydney Water should improve its annual reporting on its water conservation that at a minimum meets the requirements of its operating licence and provides clear and evidenced information on:
- water savings for each initiative for the previous five years, how these compare with forecast savings and how these savings are verified
- expenditure on each initiative for the previous five years
- how customer interaction and education initiatives are encouraging behavioural change
- ongoing water savings from previous initiatives and whether its water efficiency initiatives are focusing on where there is the greatest potential to maximise water savings.
1.1 Water conservation
Water conservation refers to water recycling, leakage management and programs to enhance water efficiency. Water recycling refers to both harvesting stormwater for beneficial use and reusing wastewater. Activities such as recycling (including the use of purified recycled water for drinking and stormwater harvesting) can represent large scale and long-term infrastructure investment.
Water conservation also involves using demand management strategies to encourage lower or more efficient water use. Awareness-raising campaigns about water use behaviours can lead to water savings and complement efficiency measures. Water efficiency measures include repairing leaks and replacing taps, shower fittings and other high water-use appliances. There can be good opportunities to do this in new residential and commercial buildings. In established urban areas, maintaining and upgrading ageing water pipes is important, as is engaging with tenants and landowners to retro-fit appliances. Monitoring water consumption and auditing water use in buildings or other sites can identify opportunities for further water savings.
Planning for and effectively implementing these initiatives requires an integrated approach with land use planning. As such, water conservation can involve new investments but can also avoid, minimise or defer the costs of building additional water storages and water supply (e.g. desalination) infrastructure.
Effective and innovative water conservation may involve policy or regulatory changes to enable new water uses and technologies. Approaches to water pricing can impact on water use behaviours among customers, and on the incentives and capacity for water utilities to save water.
Exhibit 1 lists a broad range of water conservation options.
|Efficiency plus education||
|Recycling, including as part of integrated land use planning||
|Reducing systems leaks and losses||
1.2 2017 Metropolitan Water Plan for Greater Sydney
Water conservation initiatives are part of a portfolio of options for metropolitan water planning in Greater Sydney. The current Metropolitan Water Plan for Greater Sydney (the 'Metropolitan Water Plan') was endorsed by the Premier of NSW in 2017.
The Metropolitan Water Plan follows from plans produced in 2004, 2006 and 2010. The plan aims to secure water supply for a growing population in Greater Sydney over the next ten or more years by:
- providing a secure and affordable water supply
- investing in value-for-money water conservation projects
- responding flexibly to drought with a strategy that can cope with more extreme droughts
- integrating water, wastewater and stormwater services to contribute to more liveable communities and healthy waterways
- releasing environment flows from Warragamba Dam to help protect and improve river health.
Exhibit 2 contains statements and commitments from the Metropolitan Water Plan that relate to these objectives. The plan also highlights the WaterSmart Cities program and it introduces the Economic Level of Water Conversation (ELWC) method (explained in Section 1.5) to replace water savings targets and recycling goals from previous metropolitan water plans.
1.3 Water savings under the Climate Change Fund
The NSW Government established the Climate Change Fund in 2007 during the Millennium Drought under the Energy and Utilities Administration Act 1987 (the Act). It is intended to address the impacts of climate change, encourage water and energy saving activities, and increase public awareness and acceptance of climate change.
Section 34F of the Act sets out the purposes of the Fund, which includes:
- to provide funding to encourage water and energy savings and the recycling of water [34F(b)]
- to provide funding to reduce the demand for water and energy, including addressing peak demand for energy [34F(c)]
- to provide funding to stimulate investment in innovative water and energy savings measures [34F(d)]
- to provide funding to increase public awareness and acceptance of the importance of climate change and water and energy savings measures [34F(e)].
The Minister administering the Act (currently the Minister for Energy and Environment) can issue orders for Sydney Water to contribute funds to the Climate Change Fund with the concurrence of the Minister administering the Sydney Water Act 1994 (currently the Minister for Water, Property and Housing). The Minister can approve money payable from the fund for any measure that the Minister is satisfied promotes a purpose referred to in the Energy and Utilities Administration Act 1987. The Fund is administered by the Department.
1.4 Water conservation requirements in Sydney Water’s operating licence
Sydney Water operates under a licence issued by the Governor and administered by the Independent Pricing and Regulatory Tribunal (IPART). The licence authorises Sydney Water to supply water, wastewater, recycled water and some stormwater services, and sets out certain requirements.
Sydney Water was required to develop a water conservation program consistent with an economic method by 1 September 2017, under its previous (2015 to 2020) operating licence (s3.2.6). This economic method, the ‘Economic Level of Water Conservation' (ELWC), was developed by Sydney Water and approved by IPART. IPART required that Sydney Water assess water leakage, water recycling and water efficiency including demand management (s3.2.1) under this method. For more detail on the ELWC calculation, see Section 1.5 below.
While developing the ELWC method from July 2015 and December 2016, Sydney Water was required to maintain its 'existing water conservation requirements', namely to maintain water usage below 329 litres per person per day; ensure that the level of leakage from the system does not exceed 121ML per day; and promote, foster and encourage the efficient use of water and the production and use of recycled water, where financially viable (s3.2.5).
Sydney Water is required to report to IPART, in accordance with the Reporting Manual. The water conservation program was to be outlined in the first Water Conservation Report, which was to be submitted to IPART by 1 September 2017 in accordance with clause 3.2.1 of the Reporting Manual.
The Reporting Manual from July 2015 and the manual from July 2018 that was current until November 2019, stated that the annual water conservation report must include the elements of Sydney Water’s water conservation program for at least the next five financial years, including (but not limited to):
- its strategies, programs and projects relating to water leakage, recycled water and water efficiency
- its water conservation objectives, targets and timetables
- extent to which these elements accord with the ELWC activity and method (clause 3.2.1).
The manual also required Sydney Water include information on any element of the water conservation program that may be identified as economically efficient by the methodology, but that Sydney Water has not implemented or is not proposing to implement.
Sydney Water's current operating licence (2019 to 2023) states that Sydney Water must:
- implement water conservation measures that have been assessed as economic, according to the agreed ELWC method
- maintain a water conservation program consistent with this economic method
- update and report on the program annually.
Sydney Water’s current reporting requirements, under the 2019 to 2023 Reporting Manual, also state that its Water Conservation Report must include information on its water conservation program for the previous financial year and for at least the next five financial years. This manual includes more specific reporting requirements than previously, including that Sydney Water's reporting must include, but is not limited to, information on:
- strategies, programs and projects relating (at a minimum) to water leakage, recycled water and water efficiency
- whether the water conservation measures are economic
- how and when the water conservation measures will be implemented
- the targeted water users
- the expected water savings.
IPART commissions annual audits of Sydney Water's compliance with its operating licence (i.e. operational audits), as required under the Sydney Water Act 1994. The audit for 2017–18 found Sydney Water to be 'compliant' on requirements related to:
- develop a water conservation program consistent with its ELWC
- report to IPART, in accordance with the Reporting Manual, on water conservation.
The operational audit for 2018–19 did not examine these water conservation requirements. The requirement to develop a program consistent with the ELWC was listed as 'NR - No requirement' (for audit or statement of compliance). The requirement for reporting to IPART in accordance with the Reporting Manual was listed as 'SC - Statement of Compliance' signed by Interim CEO in August 2019 i.e. Sydney Water did not report any non-compliance with Water Conservation requirements.
IPART provides the operational audit reports to the relevant minister, currently the Minister for Water, Property and Housing, and the reports are tabled in the NSW Parliament.
1.5 Sydney Water’s Economic Level of Water Conservation
Sydney Water developed the ELWC method, which was approved by IPART in 2016. The method was introduced to replace the 'water conservation targets' that were part of Sydney Water's operating licence until December 2016. Specifically, a requirement to:
- maintain water usage level to less than or equal to 329 litres per person per day
- ensure that the level of water leakage from its drinking water supply system (the water leakage level) does not exceed 121 ML per day.
Sydney Water's ELWC method is an approach to determining when to invest in water conservation: simply put, when the cost of a water conservation initiative is less than the value of the water saved, it should be implemented. The method is designed to consider different types of water conservation investments against the value of water, in two ways.
- Short-term investments, such as partnering with councils to encourage businesses to implement water savings:
- in the short term, when the value of water is related to dam storage levels, the method is designed to respond to falling storage by increasing investment in water conservation, particularly because falling storage levels will otherwise start to trigger new costs - such as more expensive desalinated water or water restrictions that have social costs.
- Longer-term investment, such as water recycling schemes:
- in the longer-term (e.g. 20 years or more) the value of water is related to the wider range of investments required to support a reliable ongoing supply of water. The usage price of water is used as a proxy for this value as, in theory, it should reflect the long run marginal cost of water supply.
The stated purpose of the ELWC method is to enable Sydney Water to determine the optimal future mix of, and right amount of investment in, water conservation. An implication of the method is that investment in water conservation should be higher in times of drought and lower when dam storage levels are high.
1.6 Recent trends in water consumption
Overall water consumption in Greater Sydney had been increasing since 2012, until water restrictions were introduced by the NSW Government in June 2019, in response to drought (Exhibit 4).
It is likely that population growth has been the major driver of this overall increase in (weather corrected) water demand over time. This is because average consumption (litres used per person each day, see Exhibit 5) has been relatively stable since 2008, although this did start to climb too in the lead up to the recent drought.
1.7 Population and climate projections affecting future water needs
Greater Sydney had a population of around 5.3 million in 2019. This is set to increase by over two million people over the next 20 years. Planners and service providers are expecting significant pressure on the water supply system.
The cost of maintaining and replacing assets such as water mains and pipes in established suburbs will continue to increase, and meeting expectations for green urban spaces will also drive the overall demand for water—particularly in growth areas. Infrastructure NSW estimates that an additional 47 GL of water per year will be required to achieve the liveability vision for Western Sydney. To put this in perspective, this additional volume is equivalent to around half the water produced by the Sydney desalination plant each year when operating at capacity.
This increased demand for water is taking place in the context of climate projections which indicate that south-eastern Australia, including Greater Sydney, will get warmer and experience more frequent heat waves. Projections also indicate that rainfall patterns will become more unpredictable, with potential for both wetter times and much longer periods of drought. As Greater Sydney is heavily reliant on rainfall-dependent dams for its water supply, this climatic variability presents a particular risk.
1.8 About the audit
This audit assessed whether water conservation initiatives for Greater Sydney are effectively investigated, implemented and supported.
We addressed the audit objective by answering two questions:
- Are water conservation initiatives effectively investigated and implemented?
- Are effective arrangements in place to coordinate and support water conservation initiatives?
The audit focused on the recent history of water conservation approaches and programs since 2016, with particular attention to commitments for the Department and Sydney Water outlined in the 2017 Metropolitan Water Plan.
More information about the audit approach can be found in Appendix two.
2. Investigating and implementing water conservation
2.1 Investigating water conservation opportunities
The Department did not complete all the research into water conservation that was required to inform the Metropolitan Water Plan. The Department was required to develop a preferred portfolio of water conservation strategies for community engagement, and a long-term strategy for water conservation and for water recycling by June 2015, but did not undertake this work.
The Department has also not undertaken detailed analyses of the viability of water conservation options for Greater Sydney since 2013. Options need to be regularly reassessed given ‘demand hardening’ that is, less capacity for customers to save more water once relatively easy and inexpensive measures have been implemented. There can also be technology advances to consider in option assessments, such as smarter metering for the water distribution network and homes, and improvements in leak management and recycling.
Sydney Water did examine a range of water efficiency initiatives for its 2018–19 program but as shown in Exhibit 6 most were not adopted, or reported in its annual water conservation reports.
|Project||Levelised cost/KL||Benefit period (years)||Viable under ELWC (67% storage - July 2018)||Adopted|
|Rebates washing machines (100%-50%)||79c||12||Yes||No|
|Rebates toilets (100%-50%)||53c||10||Yes||No|
|Rebates water saving fund (100%-50%)||91c||10||Yes||No|
|Rebates rainwater tank (50%-25%)||90c||20||Yes||No|
|WaterFix Residential (100%-50%)||$2.69||17||No||Yes*|
|WaterFix Strata (100%-50%)||$4.10||17||No||Yes*|
|Audits online monitoring||$2.94||2||No||No|
|Audits concealed leaks||24c||10||Yes||No^|
|Love your garden||$12.65||10||No||No|
|Audits rainwater tank repair||69c||10||Yes||Yes#|
|Audit – high business users (100%-50%)||$2.60||10||No||No|
|Economic level of leakage program||3c||5||Yes||Yes|
* Offered as a full cost recovery service i.e. not subsidised.
# Pilot program initiated.
^ Sydney Water did deploy an algorithm to monitor increases in water usage for residential customers.
Note: Percentages indicate range of storage levels where relevant.
Source: Data provided by Sydney Water; 2018–19 Water Conservation report.
Options considered by Sydney Water for its 2019–20 program included expanding its WaterFix programs for homes and businesses, rolling out ‘smart metering,’ enhancing leak management, and implementing water saving programs for schools, hospitals, social housing, hotels and high-water users. However, the overall approach to analysing these options and other opportunities has been ad hoc and lacking depth.
The absence of detailed analyses means that the most effective options may not have been considered when developing a program of water conservation initiatives in Greater Sydney. It also means that opportunities for partnerships with other NSW Government agencies and councils to implement programs have not been fully scoped, and that activities have not been optimally developed—for example, water efficiency programs may not have been targeted to the suburbs or customer groups where there is the most potential for new or increased take-up.
Sydney Water also commenced some pilots in 2018 and 2019 to inform its water conservation program. It is unclear whether Sydney Water intends to progress and expand the council and school initiatives.
In October 2019, Sydney Water developed a detailed framework for new initiatives to be considered under its ELWC method. There is little evidence that Sydney Water used this framework, or used it effectively, in preparing its 2019–20 water conservation program because only a limited range of initiatives was analysed, and fewer implemented.
2.2 Planning for water conservation
The Department has not created a strategy for water conservation in Greater Sydney. This is despite the ‘critical role’ identified for water conservation in the Metropolitan Water Plan (see Exhibit 2).
The Department does not have a plan for supporting Sydney Water’s water conservation programs. Activities that the Department might undertake would include providing detailed options studies on the types and the scale of initiatives that could be implemented by Sydney Water and/or private sector utilities. It could also support relationships with stakeholders such as state agencies and Local Government, and undertake regular reviews of the level of investment in water conservation.
The Department has commenced the development of a water efficiency framework for New South Wales and a water efficiency program for Greater Sydney. It indicated that this work will involve:
- collaborating with Sydney Water, Water NSW and other stakeholders to build capacity for water conservation, and increase private sector involvement
- gaining a greater understanding of water use, improving the evaluation of water conservation programs, and developing a framework that considers the total water cycle—from water supply through to wastewater treatment and discharge to oceans and waterways
- providing a clear statement of government policy and messaging about the need to support and invest in water efficiency across all sectors, including the development of a water saving goal for Greater Sydney.
The Department advises it plans to include the water efficiency program in the Greater Sydney Water Strategy and is currently in the process of seeking funding to implement the program.
Sydney Water’s water conservation reports outline water conservation activities for the next five years and state that this program is informed by its ELWC method. The reports include the estimated water savings of each water conservation initiative, information on the expected number of participants for some initiatives, and the overall level of investment that would be needed.
There is little information in these reports, and in other Sydney Water documents, about how each water conservation initiative will be resourced and funded annually, or over a five-year period. The reports provide no explanation of how initiatives will be expanded or contracted as dam storage levels change, which is an expectation of the Metropolitan Water Plan.
There is limited information on what initiatives will be economically viable at each storage level and no information on their scale and how this would be determined. Sydney Water has not included information on most of its leak management activities in its reported forward program. Reporting on leak management is required under its operating licence.
Sydney Water's water conservation reports do not clearly separate funds that are spent by Sydney Water in subsidised programs such as WaterFix Residential, and the money contributed by its customers. This information would support transparency on the level of investment.
Sydney Water was required under its operating licence to develop a water conservation program consistent with the ELWC methodology by 1 September 2017. It did not do so and did not report on the initiatives that were economically viable but not implemented.
In 2017–18, WaterFix Residential and WaterFix Strata would have been economically viable for Sydney Water to implement with a subsidy. This is because, given the 17-year payback period that applies to WaterFix, the value of water is less than the levelised cost of these programs ($1.47 per KL and 63c per KL, respectively) and close to the long-run marginal cost of water which varies between around $1.80 and $2.20 depending on dam levels (see Exhibit 3). A subsidised approach may have increased customer uptake. Sydney Water also assessed other initiatives against its ELWC method for 2018–19 but most initiatives that were economically viable were not adopted (see Exhibit 6 above).
We note that Sydney Water recorded in its Water Conservation Program Control Board minutes in May 2019 that, 'the ELWC has not been applied in 2016 to 2020, no budget was allowed, and no mechanism was enacted'.
Anomalies in Sydney Water's calculations for the levelised costs of water conservation initiatives mean that Sydney Water could be underestimating or overestimating these costs.
Levelised costs for the same activities should remain relatively constant each year, unless there are significant economies of scale associated with introducing a much larger program. Sydney Water’s estimated levelised cost varies significantly from year to year for some initiatives. The WaterFix Strata levelised cost, for example, jumped from 63c to $4.10 per KL between 2017 and 2018. The 2017 estimate has double the water savings at a third of the cost: 1.6 million KL saved from a $1.0 million cost, compared to 0.8 million KL saved from a $3.4 million cost. In 2019, Sydney Water reported the levelised cost for WaterFix Strata as $2.06 per KL.
Given the data Sydney Water provided it is difficult to determine the reason for these large changes, although they appear inconsistent. These unexplained variations are an issue because the initiatives should be included in the water conservation program if their cost is less than the cost of water.
There are also anomalies in the way Sydney Water is valuing water under its ELWC method, which in turn affects its investment response to declining dam storage levels. These anomalies relate to the probability analysis it is using.
Sydney Water uses a probability analysis to calculate the short run value of water. This analysis is based on the probability of future dam storage levels over the next five years, starting from different storage levels. As it is more likely that dam storage levels will return to average over five years than within just 12 months, the value of water used in Sydney Water's ELWC calculations will be lower using its five-year approach. This, in turn, is less likely to encourage timely investment during the drought. Sydney Water does not explain why it uses probabilities over a five-year timeframe as it commits to a 12-month program, not a five-year program.
Sydney Water’s ELWC method also includes a short-run scarcity value in the calculations for the short-run value of water. The table below includes the probability of being at or below different storage levels that trigger water restrictions and the corresponding scarcity values.
|Water restriction level||Scarcity value of water||Storage level trigger from 2017 Metropolitan Water Plan||Probability of dam storage starting at the trigger level and being at that level or less any time in the next five years|
The figures in the table mean that even if Level 2 or Level 3 water restrictions are triggered in Greater Sydney, the scarcity value at these low levels will provide little or no increase in the value of water used in the ELWC calculations. This is because of the low probability of low storage levels any time in the next five years. This means the scarcity values will not promote additional investment when storage levels are at these low levels. The ELWC method is meant to trigger investment during (or before) the drought.
The limited impact of the scarcity values used by Sydney Water on increasing the value of water is demonstrated in Exhibit 3. This shows that the maximum value of water under its method is around $2.40/KL when dam levels are 40 per cent. This means the probabilities used in the ELWC calculations may undervalue water at lower storage levels.
Sydney Water’s probabilities used for its ELWC calculations show inconsistencies in future (over the next five years) dam storage levels at different starting levels. For example:
- If storage is at 55 per cent, the data shows a 66 per cent probability of future storage being at or above 80 per cent. If storage is at 60 per cent the data shows a 51 per cent probability of future storage being at or above 80 per cent.
- If storage is at 50 per cent the probability of reaching 100 per cent in the next five years is 25 per cent. If storage is at 60 per cent the probability of reaching 100 per cent is only ten per cent.
IPART has also noted potential problems with how Sydney Water has been costing the short-run value of water. In its June 2020 review of Sydney Water’s prices, IPART reported that Sydney Water could have been undervaluing water, and therefore under performing in water conservation and leakage management.
Under the ELWC methodology, the long-run value of water is assumed to be the usage price determined by IPART. In its June 2020 review of Sydney Water prices, IPART recognises that the usage price may not always accurately reflect the long-run cost of supplying water. In effect, the probability of triggering large scale infrastructure investment increases as storage levels deplete.
The implication for Sydney Water’s current ELWC calculations is that, in years where the starting storage is low, Sydney Water will underestimate the long-run cost of water which may result in an underinvestment in water conservation activities.
There are discrepancies when comparing Sydney Water's proposed investments with what would be expected given different values of water and dam levels. This reflects Sydney Water’s poor planning and lack of subsequent implementation of economic water conservation initiatives. Increased investment as dam levels fall is an expectation of the 2017 Metropolitan Water Plan.
To illustrate, Sydney Water’s proposed water conservation expenditure for 2019–20 of $18.6 million was calculated in July 2019, when dam levels were at 52 per cent. By comparison, a proposed annual expenditure of $40.0 million was proposed soon after, in November 2019 when dam storage levels were at 50 per cent. Sydney Water has indicated that the $18.6 million budget was prepared by diverting operating expenditure from elsewhere, given a lack of funds for water conservation for 2019–20. In contrast, the November 2019 proposal of $40.0 million was reportedly prepared using its ELWC methodology.
|Reporting year for forward planning||Date of dam level calculation||Dam levels||Short run value of water||Investment in active leak management||Investment in water efficiency||Proposed investment for next financial year|
|2016–17||Jan 2017||90%||$0.56||$883||$631||Not reported|
|2017–18||Jul 2018||67%||$1.28||$1,124||$1,061||Not reported|
|Nov 2019||Nov 2019||50%||$2.03||Not reported||Not reported||$40,000|
Note: Water efficiency primarily includes WaterFix, PlumbAssist and pilots. Also includes funding from customers as WaterFix was full cost recovery.
Source: Sydney Water's, Water Conservation Reports and Sydney Water's Update to 1 July Price Proposal, 12 November 2019.
In 2007, the then Minister for Environment, Climate Change and Water issued a contribution order to Sydney Water requiring it to contribute to the Climate Change Fund. This was to resource the Department's and its own water conservation activities. This source of funding ceased in June 2012 following the expiry of the order. The Department's proposed plan for water conservation is currently unfunded.
Sydney Water has not maintained a baseline level of investment in water conservation. A consultancy report commissioned by the Department in 2013 stated that baseline water conservation (that is, activities which occur at all times including outside of drought) is critical to ensuring that water savings are retained, and that water conservation can increase quickly, should drought return. Maintaining relationships with sector specialists, businesses and government are particularly important.
Sydney Water did not request baseline funding for water conservation in its June 2015 price submission to IPART, although this may have been an option available to it in preparation for developing a program consistent with the ELWC method by 1 September 2017.
Sydney Water did request baseline water conservation funding ($10.0 million) in its July 2019 pricing submission to IPART. Also, in its updated November 2019 price submission, Sydney Water requested a mechanism that would allow it to pass-through to customers (in the next year) the costs of delivering initiatives including an expanded water conservation program. IPART has allowed this baseline funding and cost pass-through in its June 2020 pricing determination.
In July 2019, Sydney Water also secured around $5.8 million in funding from its contributions to Climate Change Fund to subsidise WaterFix Residential.
2.3 Implementing and reviewing water conservation
Sydney Water's water conservation initiatives were limited in scope since 2017. The evidence indicates that Sydney Water did not implement initiatives that were economic under the ELWC methodology and did not meet 2017 Metropolitan Water Plan requirements.
There was a limited investment response from Sydney Water on water conservation when dam storage levels started to decline from 2017. As shown in Exhibit 10, as the storage levels were dropping, the costs associated with providing water were increasing, which means that more water conservation initiatives should have become economically viable under its ELWC method. In 2017–18 Sydney Water did run its WaterFix Residential and WaterFix Strata initiatives although this was done on a full cost recovery basis and was limited in scale. It also reported an increase in investment in its active leak detection program.
For 2018–19, as noted in Exhibit 6, three out of the eight initiatives that were assessed as economically viable under the ELWC were implemented. WaterFix Residential and WaterFix Strata continued on a full cost recovery basis. An expanded and subsidised version was being run with funding from the Climate Change Fund from July 2019.
The number and scope of these initiatives is limited compared with the suite of water conservation initiatives developed and implemented during the Millennium drought as shown in Exhibit 11.
The Department and Sydney Water were successful in reducing overall water consumption during the Millennium drought, with Sydney’s consumption each year reducing from around 630 GL in 2003 to around 500 GL in 2012.
The Department estimates that cumulative water savings achieved during the drought exceeded 116 GL from programs that were operating prior to 2011–12. However, the gains made during the Millennium drought have been partially eroded with consumption peaking in 2017–18 at 600 GL/year, noting that population increases are also a factor.
Up until 2012, water conservation initiatives in Sydney Water and the Department were being funded from the Climate Change Fund with contributions of around $30.0 million/year from Sydney Water.
The initiatives from the Millennium drought were not funded from June 2012, when Sydney Water was no longer required to contribute to the Climate Change Fund. This was despite stakeholders and the Minister raising concerns that there was still community support for the water conservation program and potential for further water savings.
Sydney Water stated that water leakage increased in 2017–18 because of pipes breaking due to clay soils contracting in the recent drought. Sydney Water exceeded its economic level of leakage in 2017–18 and 2018–19. Sydney Water reported a leakage level of 129.5 ML/day for 2017–18 and 131 ML/day for 2018–19.
There was a requirement in its previous operating licence until December 2016, when Sydney Water's ELWC method was approved by IPART, that leakage should not exceed 121 ML/day. It reports that it did respond to more watermain breaks and did invest more in active leak detection over the period, and there was a significant increase in time taken to repair breaks and leaks.
IPART released findings on the matter in June 2020. It concluded that Sydney Water’s increased reactive pipe maintenance is partly due to previous inefficient leakage management and a declining trend of planned maintenance between 2012 and 2016. IPART also noted that Sydney Water’s leakage and broader water conservation performance is an area where the performance has recently declined and there are increased community expectations for this activity, particularly given recent drought conditions.
In 2018–19 Sydney Water expanded its approach to conserving water with around $5.8 million recently returned to it from the Climate Change Fund and funds redirected from other programs. Specifically, in 2019–20, Sydney Water has started to expand WaterFix to improve residential water efficiency. It did plan to implement a range of water saving measures for businesses but is yet to undertake this work.
In early May 2020, it advised it had spent around $4.0 million out of $5.8 million from the Climate Change Fund, and spent around $650,000 of the $10.4 million that it had directed from other programs.
Sydney Water has reported limited information on how water savings and investments are tracking. While Sydney Water produces an annual water conservation report with some analyses of water savings and costs, which is a requirement of its operating licence, these reports lack detail and meaningful performance information.
It is difficult to use these reports to gauge the impact of water conservation initiatives, changes in initiatives and in the levels of investment over time, and scope for improvement. Many of the variations between expected and actual water savings are not explained. Sydney Water does not display previous year’s water conservation reports on its website, further limiting transparency.
Sydney Water did not include information in its 2017–18 and 2018–19 water conservation reports on initiatives that it identified as economically efficient (using the approved method) but did not implement - this reporting was required by the reporting manuals accompanying its operating licence.
The Department has not done annual assessments on the level and appropriateness of investment in water conservation, but this was expectation under the Metropolitan Water Plan. The plan states that the Department 'must undertake this assessment against water security risks and capacity to respond when drought conditions return, or when demand rises, and make recommendations to government in relation to any required actions'.
The Metropolitan Water Plan also states that, ‘a detailed Monitoring, Evaluation, Reporting and Implementation Plan is being developed to guide and support the Plan’s implementation,’ but the Department did not complete or implement this. This creates a lack of transparency and accountability around activities and limits potential for performance improvements. It also creates a risk that reforms, including work to develop a new water strategy for Greater Sydney, will have a limited evidence-base with regards to water conservation on which to draw.
3. Coordinating and supporting water conservation
3.1 Governance around water conservation
The Department and Sydney Water have not adequately identified and allocated responsibilities for key activities to plan for, undertake, support and report on water conservation. There is no overall water conservation strategy for Greater Sydney. The absence of clearly defined responsibilities has led to poor accountability, oversight and direction by the Department.
Concerns with the lack of governance around water conservation, and strategic water management more broadly, have been noted by the Water Coalition Senior Officers Group. In November 2019, the group raised the need for stronger water policy and leadership in Greater Sydney to support integrated water management, and the need for more clarity around water management objectives, outcomes and accountabilities. The group has members from Sydney Water, the Department, the NSW Environment Protection Authority (EPA) and Water NSW. Consultants engaged by the Department also reported governance issues in 2015, as did IPART in its 2019 submission to the NSW Productivity Commissioner.
Further, reviews of previous metropolitan water plans highlighted governance as an issue, but the 2017 Metropolitan Water Plan still failed to allocate responsibilities to agencies for a range of important activities. Examples of activities for which responsibilities are not clear include to:
- ‘continue to monitor water use and review options to meet the future water needs of Sydney’s growing population’
- ‘plan and develop innovative water solutions that address, in a holistic way, the water needs of our new and expanding communities’
- ‘use our existing supplies more efficiently, invest in water conservation initiatives, and make sure there is sufficient water to meet Greater Sydney’s long-term water needs’
- ‘support the WaterSmart Cities program with an investigation into the barriers and enablers of investment in economically efficient recycling initiatives’.
There is also no clearly defined role or agreement for the Department to have input into Sydney Water's water conservation program and ELWC method.
Sydney Water developed a roles and responsibilities protocol for the Metropolitan Water Plan and was required under its 2015 to 2020 operating licence to use its 'best endeavours' to agree on this with the Department. The document was never agreed and finalised by the parties. The Department advised Sydney Water and IPART that it did not wish to progress the Roles and Responsibilities Protocol due to the formation of the Water Coalition Senior Officers Group.
The Department's ability to develop policy and identify and undertake, or allocate responsibilities, to support water conservation has been negatively impacted by frequent structural changes and staff turn-over for the team with carriage of metropolitan water planning. Between August 2005 and July 2019, the function changed departments six times and was split on two occasions into separate offices before being re-merged as shown in Exhibit 12.
|August 2005||The Metropolitan Water Directorate (MWD) moved from the Department of Infrastructure, Planning and Natural Resources to the Cabinet Office.|
|May 2007||The MWD moved to the Department of Water & Energy.|
|July 2009||The MWD split and moved to the Department of Environment, Climate Change and Water (DECCW), and the Office of Water established as a separate office within DECCW.|
|April 2011||The MWD moved to the Department of Finance and Services; Office of Water moved to Department of Primary Industries (DPI).|
|May 2014||The MWD moved to the Department Primary Industries and merged with Office of Water.|
|July 2017||The MWD moved to Department of Planning & Environment.|
|2018–19||The MWD was abolished and the Metro Water and Utilities teams created, the WaterSmart Cities program cancelled.|
|July 2019||Metro Water team and former Office of Water staff remerged into Water Division within the Department of Planning, Industry and Environment.|
The Department is developing a water strategy for Greater Sydney as a new approach to metropolitan water planning for the region. This is planned for completion by mid-2021 and may better articulate roles and responsibilities.
3.2 Integrating water conservation with urban planning
The Department has not provided leadership in the coordination of water resource planning in Greater Sydney, particularly to confirm the role of water conservation in the portfolio of water management options.
The Department cancelled the WaterSmart Cities program in 2018. The program was a major Climate Change Fund initiative identified in the Metropolitan Water Plan to explore integrated water cycle management and improve interagency coordination, including with Sydney Water (see Exhibit 2). The stated reason for the cancellation of WaterSmart Cities was potential duplication with other activities. There were also concerns raised by a program review as to whether the work was on track to deliver against key milestones. But the issues that the program aimed to address, for Greater Sydney as a whole, remain.
Around $5.8 million for the program from the Climate Change Fund was then returned to Sydney Water to fund its water efficiency activities. At one point in 2018–19, the funds were to be re-purposed within the Department to explore regulatory and other barriers to stormwater harvesting in Sydney, but this project was dropped. We note that, since the cancellation of WaterSmart Cities, no similar program has been established with coverage across Greater Sydney although Infrastructure NSW has investigated integrated water cycle management options for Western Sydney through the South Creek Sector Review.
Infrastructure NSW estimates that an additional average 47 GL of water per year will be required to achieve the ‘Parkland City’ vision for Western Sydney of green neighbourhoods and urban spaces, which is 35 per cent more than if activities were not undertaken to achieve this vision.
Sydney Water’s Strategic Capital Investment Plan for 2020 to 2044 considers integrated water cycle management as an option for Western Sydney—this would include water recycling plants and indirect potable reuse via pipelines to Prospect Reservoir. Sydney Water also advises that it is working closely with the Greater Sydney Commission, Infrastructure NSW and other agencies through a range of forums, such as the Western Sydney Growth Infrastructure Compact.
In March 2019, the Sydney Water Managing Director wrote to all Greater Sydney councils with advice on how to better align land use planning and water management. Copies of Sydney Water’s advice was also provided to the Greater Sydney Commission and the Department.
There has been no expansion in Sydney Water’s water recycling in the last eight years. It assessed the viability of one major recycling scheme in 2019, and the options were found to be 15 to 40 per cent more expensive than traditional water and sewer services. Sydney Water advises it is currently considering a range of the other recycling schemes.
Barriers to water recycling have been noted by the Department, IPART, other state agencies and water industry stakeholders. Reported institutional, policy and regulatory barriers to the uptake of economically efficient water recycling that have not been addressed include that:
- private sector utilities who may include recycled water in their developments have limited access to planning and land release processes
- developer charges are levied for recycled water schemes, but not for traditional water and wastewater servicing, making the former relatively more expensive: the Department has not reviewed the costs and benefits of the 2008 NSW Government Direction to set these developer charges to zero
- there is unclear policy direction on the direct or indirect reuse of potable water, which means houses and buildings that are connected to water recycling schemes must have a third pipe for the non-potable water, which can be expensive to install (see Exhibit 13).
The Department has not made substantive progress towards addressing or coordinating a response these or other barriers.
Also, the Department has not completed a regulatory framework that should accompany amendments to the Water Industry Competition Act 2006. As such, the amendments which were passed by NSW Parliament in 2014 to facilitate competition, encourage innovation and improve efficiency have not come into force.
The Department and IPART accepted a recommendation, from a report on barriers to recycling commissioned by Infrastructure NSW in July 2018, to make more information available to private sector utilities about current and projected demand, and water and wastewater system capacity. This will include current and projected capacity constraints and the cost of alleviating or deferring those constraints. The provision of this information may help current and new entrants to the water recycling market. Under its operating licence, Sydney Water will be required to provide this information on its website from 30 September 2020.
Some of the challenges associated with developing economically viable recycling schemes are evident in the Hoxton Park recycling scheme outlined in the following exhibit.
Construction of Sydney Water’s Hoxton Park recycled water plant was started in 2010 with the aim of providing 14,000 homes and an industrial area with recycled water by 2013. Recycled water flows were estimated to gradually increase to 800 ML a year by 2025.
In 2016, the recycled water scheme was still inactive, with the delay attributed to less demand than expected for housing in Sydney’s planned growth suburbs. Currently about 4,000 properties have been connected. Another 2,500 homes are needed to connect to 'ensure there is enough demand to efficiently operate the scheme and produce recycled water that meets the water quality guidelines'.
Customers in the scheme area are expected to be supplied with recycled water from late 2022 at the earliest. There is no requirement for people to connect to the scheme, making it less economically viable.
Sydney Water advises it is in the process of designing important changes to the Hoxton Park scheme that will allow recycled water to be used during construction of the new Western Sydney Airport, particularly for dust suppression. Once construction of the airport has progressed, it expects that the number of residential customers will have increased sufficiently to maintain on-going operation.
The Department has not widely explored or progressed stormwater harvesting as a water conservation option. In most areas in Greater Sydney, stormwater infrastructure (e.g. drains) is owned by councils and stormwater is directed away to avoid local flooding.
The Productivity Commission has noted that effectively managing stormwater and harvesting this water for other uses involves a complex interface between local governments, water utilities and regulators. Recent investigations by Infrastructure NSW have highlighted that stormwater harvesting has a role in meeting water needs in Western Sydney's growth areas.
The Department did not progress a 2018 project, to be funded with $5.8 million from the Climate Change Fund, to address stormwater infrastructure delivery by 'establishing a model for delivering and maintaining stormwater infrastructure in high growth areas in Western Sydney'. The model was to be piloted and considered for its applicability in other areas of Greater Sydney.
There is a need for departmental leadership in identifying a catchment-based approach to waterways governance, which operates across local government areas to integrate stormwater management including harvesting, with floodplain management and river health.
The Department has had a role in measures to encourage efficient water use in residential and commercial buildings, and in urban growth and infill areas.
- The Department is the Australia-wide administrator of the National Australian Built Environment Rating System (NABERS). NABERS can be used to measure and compare a building’s water consumption, as well as energy efficiency, carbon emissions and waste. Participants are encouraged to reduce energy and water consumption and so improve their building's NABERS rating over time.
- The Department reports on progress with the Building Sustainability Index (BASIX), which was introduced in 2004 to encourage the installation of water-saving fixtures and alternative water sources in new homes and large renovations. Since 2011, over 160,000 certificates have been issued under BASIX for residential dwellings.
There may be potential for BASIX to be enhanced, especially in relation to water use targets and the use of recycling and rainwater tanks. The NSW Government did not adopt recommendations made in 2013 to increase the BASIX water saving targets. Also, the Department does not have accurate data on the number of individual homes covered by BASIX as certificates can be issued for individual dwellings (i.e. houses) or one certificate can apply to a whole apartment block.
3.3 Collaborating on water conservation
People in Greater Sydney value water conservation, according to community engagement conducted by the Department and Sydney Water. But the Department has not leveraged this opportunity in collaboration with Sydney Water, particularly outside times of drought.
The Department has missed opportunities to support Sydney Water’s water conservation partnerships. For example, to facilitate engagement with relevant government agencies such as:
- the Department of Education, to encourage schools to conduct water efficiency audits and implement these measures
- the Office of Local Government, to enhance councils' engagement with programs to improve water efficiency in local businesses, and to implement sustainable water solutions in their Local Strategic Planning Statements.
The Department did not support businesses and government agencies to 'ramp-up' water conservation during the recent drought.
There is no evidence that the Department has done regular assessments of different sectors' capacity to engage specialist water efficiency auditors and plumbers to implement water saving action plans. Water savings activities in place during the Millennium drought have also ceased: at that time, 240 high water-use business and all 44 councils in Greater Sydney were required to prepare water savings action plans, and over 30 government sites also developed plans.
In developing the Metropolitan Water Plan, the Department found that the community is interested in ways to use water more wisely in and around the home, and they consider water efficiency and recycling to be important. It also found that people may be willing to pay to facilitate investment in water conservation, including recycling.
The Department has not implemented some community engagement activities required under the Metropolitan Water Plan. For example, there is no evidence that it has progressed identified actions to pursue and report on community attitudes about highly-treated recycled water for drinking water supply in the future.
The WaterSmart Cities program would have represented a collaborative approach to water and land use planning, including comprehensive community and stakeholder engagement. The Department did some engagement in the early stages of developing the program but discontinued before outputs were developed.
Sydney Water commissioned extensive surveys on customers willingness to pay in 2018 but there has been little focus in these on water conservation initiatives. A customer forum in 2018 indicated support for voluntary demand reduction (i.e. tougher Water Wise Rules), including rules around internal use. Support to implement a voluntary target for water use, such as 180 litres per person per day, was also found. No progress has been made by Sydney Water or the Department on further investigating or implementing these opportunities.
Sydney Water conducts limited community awareness campaigns to encourage water conservation outside of drought. The community's response to the recent drought shows there is potential for this to reduce water consumption. Sydney Water commissioned a survey of 1,000 Sydney residents in late April 2019 that showed that nearly two thirds of Sydneysiders were unaware that Greater Sydney is in drought. Survey data also showed that almost one in five did not feel their water-saving efforts would make a difference, despite almost two thirds of people knowing they could reduce their water usage.
From May 2019, Sydney Water ran community awareness campaigns focused on drought awareness and understanding. This included print, radio, social media and online advertising. Sydney Water estimates water savings of around 76 GL from water restrictions and awareness campaigns from November 2018 to March 2020.
Appendix one – Responses from agencies
Appendix two – About the audit
Appendix four – Performance auditing
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Parliamentary reference - Report number #336 - released 23 June 2020