Water shortages and the rising cost of usage are major issues for WA businesses, which already pay a premium for their water. Likely cost increases will put further pressure on this valuable resource, as Catie Low reports.
THE increasing cost of water is behind a push by business and industry to develop strategies aimed at minimising the financial impact of water use.
Business and industry use of water represents only 20 per cent of the total use of the resource in WA, but charges levied are significantly higher than those charges borne by domestic users.
While most major industries use bore water to supplement scheme water in operations, the use of scheme water in industry has been a focus for the Water Corporation for several years.
Water Corporation manager business relationships, Max Viskovich, said any change in the cost of water in the future would depend on the outcome of a number of different initiatives, including the water symposium in October.
Forward estimates for the Water Corporation published as part of the Government’s 2002-2003 budget suggest the dividend from the Water Corporation will rise by more that 30 per cent over the next three years.
The dividend from the Water Corporation is currently $236,910,000 for the 2002-2003 budget, rising to $313,493,000 in the 2005-2006 budget.
The Water Corporation claims the increase in dividends and tax over time is a reflection of growth of the customer base.
“The general increase in dividends [and tax] over time is a reflection of growth in the number of customers we provide services to rather than price increases,” manager corporate affairs Paul Byrne said. “In fact, price increases are kept to the same level as inflation.”
Business and industry currently pay about 73 cents a
litre, compared with an average cost of 60c/L paid by domestic users.
The Centre for Water Research at the University of Western Australia and the final year environmental engineering design team have undertaken a study of the State’s water supply.
The findings, Western Australia’s Water Supply: A Holistic Study, suggests the Water Corporation should increase charges for water across the board.
The Water Corporation claims the proposed $20 million waste water treatment plant in Kwinana will remove the need for major industries to use scheme water in their operations.
“It [the waste water recycling plant] will replace between 2 per cent and 3 per cent of Perth’s scheme water demand,” the Water Corporation’s Max Viskovich said.
“On the Kwinana strip we’re about to build a waste water recycling plant.
“That will take water from the pipeline that we normally discharge into the ocean.
“This is domestic waste water. About one third of Perth’s waste water goes along that line, it’s the south of the river feed.
“We’ll take water from that pipe and treat it up to a very high quality water that’s targeted to industry use, and supply it to the large industry in Kwinana to replace some of the bore water that they use and all the scheme water.”
In spite of the projected water savings the Kwinana plant will deliver it doesn’t provide industry in the area with any cost breaks.
“When you take into account the cost onsite of treating their existing water to the standard that this water will be, it breaks about even,” Mr Viskovich said.
“It’s a commercial project that the Water Corporation is funding and it then recovers the money through water sales.
“The project has about a 15-year life; that’s normal.
“It’s basically a desalination plant. It’s the same principle, we’re just not using seawater, it’s waste water.
“There’s a similar operation in Brisbane doing the same thing. This has been in the planning since the late 1990s.”
The scarcity and cost of water in WA has forced business and industry to be focused on water efficiency and, compared with other parts of the country, operators in this State are very water efficient, according to the Water Corporation.
Among industry’s biggest water users are Wesfarmers CSBP, BP, Swan Brewery, Alcoa and Tiwest Joint Venture.
Most of these operations rely heavily on underground bores so as to minimise the use of scheme water.
“The drivers for us are obviously cost and the recognition that the cost of water is going to go up,” Swan Brewery Company brewing manager Hugh Dunn said.
“We’ve had significant involvement with the Water Corporation in the past couple of years.
“The other driver is from an environmental point of view and [that of] social responsibility.
“We’re a big user and a fair bit of that goes out the door as beer, but we also use a considerable amount of water for cleaning.
“Our costs have increased, particularly in the past year because the Water Corporation has moved to use more deep bore water south of the river.”
The mix of bore and scheme water delivered to consumers and businesses in Perth poses problems for the Swan Brewery, where the end product requires a stable supply of water of a consistently high quality.
To overcome problems associated with variations in the scheme water the brewery has installed a reverse osmosis plant, developed in conjunction with the Water Corporation, at its Canning Vale operation.
Mr Dunn said it was vital to ensure a consistent supply of water.
“The plant basically reduces the salt concentration in the water and produces a stable water supply,” Mr Dunn said.
“It’s done on an arrangement with the Water Corporation. They manage the project and we’re leasing the equipment from them.”
The plant has not only added to the cost of operations for the Swan Brewery, and also has added a further 10 per cent to the business’s water requirements because of the nature of the reverse osmosis facility.
“With the reverse osmosis you end up with purified stream and a small concentrated [salts] stream,” Mr Dunn said.
“We need an extra 10 per cent water, but it varies depending on the quality of the water. The issue for us is consistency and we recognised we were going to need more water.”
To counter the increase in usage, the brewery has employed project engineer Jared Murray to develop water saving strategies.
Mr Murray has developed a number of ideas, which delivered water savings of 8 per cent across the operation.
“We did implement the [water] savings but the reverse osmosis plant put us back to square one,” Mr Dunn said.
The costs associated with water stretch beyond merely the fixed costs. There are several reporting and monitoring functions that add up to increased staff costs for industry. Reporting on environmental issues such as greenhouse gas emissions and water usage and quality was a burgeoning area for a business such as the Swan Brewery, Mr Murray told WA Business News.
Business and industry use of water represents only 20 per cent of the total use of the resource in WA, but charges levied are significantly higher than those charges borne by domestic users.
While most major industries use bore water to supplement scheme water in operations, the use of scheme water in industry has been a focus for the Water Corporation for several years.
Water Corporation manager business relationships, Max Viskovich, said any change in the cost of water in the future would depend on the outcome of a number of different initiatives, including the water symposium in October.
Forward estimates for the Water Corporation published as part of the Government’s 2002-2003 budget suggest the dividend from the Water Corporation will rise by more that 30 per cent over the next three years.
The dividend from the Water Corporation is currently $236,910,000 for the 2002-2003 budget, rising to $313,493,000 in the 2005-2006 budget.
The Water Corporation claims the increase in dividends and tax over time is a reflection of growth of the customer base.
“The general increase in dividends [and tax] over time is a reflection of growth in the number of customers we provide services to rather than price increases,” manager corporate affairs Paul Byrne said. “In fact, price increases are kept to the same level as inflation.”
Business and industry currently pay about 73 cents a
litre, compared with an average cost of 60c/L paid by domestic users.
The Centre for Water Research at the University of Western Australia and the final year environmental engineering design team have undertaken a study of the State’s water supply.
The findings, Western Australia’s Water Supply: A Holistic Study, suggests the Water Corporation should increase charges for water across the board.
The Water Corporation claims the proposed $20 million waste water treatment plant in Kwinana will remove the need for major industries to use scheme water in their operations.
“It [the waste water recycling plant] will replace between 2 per cent and 3 per cent of Perth’s scheme water demand,” the Water Corporation’s Max Viskovich said.
“On the Kwinana strip we’re about to build a waste water recycling plant.
“That will take water from the pipeline that we normally discharge into the ocean.
“This is domestic waste water. About one third of Perth’s waste water goes along that line, it’s the south of the river feed.
“We’ll take water from that pipe and treat it up to a very high quality water that’s targeted to industry use, and supply it to the large industry in Kwinana to replace some of the bore water that they use and all the scheme water.”
In spite of the projected water savings the Kwinana plant will deliver it doesn’t provide industry in the area with any cost breaks.
“When you take into account the cost onsite of treating their existing water to the standard that this water will be, it breaks about even,” Mr Viskovich said.
“It’s a commercial project that the Water Corporation is funding and it then recovers the money through water sales.
“The project has about a 15-year life; that’s normal.
“It’s basically a desalination plant. It’s the same principle, we’re just not using seawater, it’s waste water.
“There’s a similar operation in Brisbane doing the same thing. This has been in the planning since the late 1990s.”
The scarcity and cost of water in WA has forced business and industry to be focused on water efficiency and, compared with other parts of the country, operators in this State are very water efficient, according to the Water Corporation.
Among industry’s biggest water users are Wesfarmers CSBP, BP, Swan Brewery, Alcoa and Tiwest Joint Venture.
Most of these operations rely heavily on underground bores so as to minimise the use of scheme water.
“The drivers for us are obviously cost and the recognition that the cost of water is going to go up,” Swan Brewery Company brewing manager Hugh Dunn said.
“We’ve had significant involvement with the Water Corporation in the past couple of years.
“The other driver is from an environmental point of view and [that of] social responsibility.
“We’re a big user and a fair bit of that goes out the door as beer, but we also use a considerable amount of water for cleaning.
“Our costs have increased, particularly in the past year because the Water Corporation has moved to use more deep bore water south of the river.”
The mix of bore and scheme water delivered to consumers and businesses in Perth poses problems for the Swan Brewery, where the end product requires a stable supply of water of a consistently high quality.
To overcome problems associated with variations in the scheme water the brewery has installed a reverse osmosis plant, developed in conjunction with the Water Corporation, at its Canning Vale operation.
Mr Dunn said it was vital to ensure a consistent supply of water.
“The plant basically reduces the salt concentration in the water and produces a stable water supply,” Mr Dunn said.
“It’s done on an arrangement with the Water Corporation. They manage the project and we’re leasing the equipment from them.”
The plant has not only added to the cost of operations for the Swan Brewery, and also has added a further 10 per cent to the business’s water requirements because of the nature of the reverse osmosis facility.
“With the reverse osmosis you end up with purified stream and a small concentrated [salts] stream,” Mr Dunn said.
“We need an extra 10 per cent water, but it varies depending on the quality of the water. The issue for us is consistency and we recognised we were going to need more water.”
To counter the increase in usage, the brewery has employed project engineer Jared Murray to develop water saving strategies.
Mr Murray has developed a number of ideas, which delivered water savings of 8 per cent across the operation.
“We did implement the [water] savings but the reverse osmosis plant put us back to square one,” Mr Dunn said.
The costs associated with water stretch beyond merely the fixed costs. There are several reporting and monitoring functions that add up to increased staff costs for industry. Reporting on environmental issues such as greenhouse gas emissions and water usage and quality was a burgeoning area for a business such as the Swan Brewery, Mr Murray told WA Business News.
