Rainwater is flowing out to sea as consumers pay an extra $100 a year to drink desalinated water, writes Heath Aston.
Fifteen months ago workers at a dam 200 kilometres south of Sydney switched off a set of high-pressure pumps that have played a critical role in safeguarding Sydney’s precarious water supply.
Transfers from Tallowa Dam, on the upper Shoalhaven River, had added more than a trillion litres to Warragamba Dam over the past decade before the taps were turned off.
The absence of that extra water, which fell from 152 billion litres in 2008 to zero this year, has been crucial to Warragamba remaining below 80 per cent full - the trigger point at which the Kurnell desalination plant must be shut down.
Had those Sydney Catchment Authority engineers - acting on the instruction of the state government - kept the pumps running, Sydney’s water supply would today stand at 94.6 per cent, according to expert projections supplied to The Sun-Herald.
With the Warragamba catchment at 78.9 per cent in reality, experts say the government is clinging to a reason to push ahead with the $1.5 billion sale of the desalination plant. While it is running, the cost of the electricity-guzzling plant adds $96 a year to Sydney water bills.
”The state government has an incentive to keep the Warragamba Dam below full,” says Professor Stuart White, of the University of Technology, Sydney, who helped write the current Metropolitan Water Plan.
”When we’re paying 70¢ per cubic metre of desalinated water, it would not be a good look to have it spilling over the top of Warragamba for free.”
It is also arguably not in the government’s interests for consumers to be aware of pure water flushing out to sea from Tallowa while they are paying for seawater to be transformed into drinking water.
White is one of a number of experts who believe the O’Farrell government will go through with the privatisation against the best interests of the populace.
”The government has the opportunity to pursue a sale for a one-off capital win or take a one-off hit - but do the right thing by the consumer and shut the plant down. It’s a radical step to shut it down but that’s what should be contemplated to save this needless waste of energy.”
White describes the planned sale as a ”win, win, lose” situation in which consumers are the losers. ”The state government wins with a capital windfall and an investor locks in to a long-term, guaranteed return,” he says.
For the past two years Tallowa Dam has been full and is currently allowing excess ”environmental flows” to flush through the Shoalhaven and out to sea.
The Greens, who support environmental flows for the Shoalhaven, nonetheless believe the switch-off at Tallowa is part a strategy to justify the existence of the desalination plant. They have accused the government of scrapping a range of water recycling schemes for the same reason.
”Tallowa has been ramped back to make the desalination plant look like a much more attractive investment when it is privatised,” the Greens MP Dr John Kaye says. ”It’s a much cleaner deal if there looks like there is at least a need for the desalination plant. It’s all about appearances.”
The government recently appointed the investment bank Goldman Sachs to run the sale.
Bankers familiar with the tender process told The Sun-Heraldthat investors, probably from overseas, would line up to buy the plant because the contract would stipulate a return whether it was operational or not.
The government has established a taskforce consisting of representatives of Sydney Water, Treasury and the Finance and Premier and Cabinet departments to establish the guidelines for privatisation.
A spokeswoman for Sydney Water, Emma Whale, confirmed the 80 per cent threshold for switching off the plant remained under the O’Farrell government. ”The dam levels should not have bearing on the sale or the contract. IPART is currently determining both a water usage and availability charge,” she said.
