Balancing short-term affordability and long-term customer value in the presence of climate change
We will work with a suitably qualified consultancy to develop a high-level action plan that helps water utilities better manage climate-related risks that affect service delivery.
Background
Responding to climate and growth-related challenges is not new for the urban water sector. However, the pace, uncertainty and potential magnitude of changes requires a greater focus on system resilience.
Integrated Water Management (IWM) is widely accepted as an important process for enhancing the resilience of water servicing and the liveability of our urban areas. It enables consideration of a broader range of water supply sources and service objectives. It has also assisted more efficient and effective integration of centralised and decentralised solutions.
However, many IWM initiatives have struggled to access sustained adequate funding.
Without adequate funding for IWM projects, the opportunity for timely investment is lost, associated benefits are not realised and vulnerability to climate and other hazards increases.
What we’re doing
Previous consultation with urban water sector practitioners identified concern and confusion about who should pay for climate-resilient water services, how and when:
- Given current cost of living pressures, to what extent should water customers pay now to enhance resilience against highly uncertain, high consequence future events?
- Who bears the cost and consequences of under/over investing in resilience?
- Do water business customers and shareholders have clear and consistent expectations about water utilities’ maintenance of water resilient water services and role in building the resilience of the community more generally.
- Do current regulatory frameworks recognise the above issues and incentivise water businesses to find appropriate responses?
The project involves working with stakeholders to:
- identify key climate risks associated with each stage of Melbourne’s regulated water and sewerage service value chain
- review Australian and international regulatory regimes to identify best practice on determining water prices
- compare Victoria’s PREMO framework with Australian and international best practice, to identify vulnerabilities and opportunities for improvement.
How it will help
The deliverables from this project will be:
- a recommended definition of climate resilience for water services in the Melbourne context
- recommendations and a high-level action plan that can help utilities balance short-term affordability with long-term resilient customer value.
The CRCWSC has produced research, guidelines and
tools related to the following topics:
Integrated Urban Flood
Management
Climate change
mitigation
Community
engagement
Economics and
business case