• Zac Efron loved the rain water when he visited my house for his new Netflix doco, Zac Efron Down Under - seen here looking at the self-cleaning gutter
Rain water is free. Earth’s weather delivers it to our houses, cleanly.
So why pay for town water?
Let’s look at typical water use where I live in the inner Sydney suburb of Chippendale, NSW. Data from my house there, which uses only rain water and recycled water, shows that for the last 27 years rain water is safer and cleaner to drink than town water. And free. I pay no water or sewage bills including no fixed charges.
More water from rain is wasted to Sydney Harbour than is imported as town water. Each year 858 million litres of rain falls on the houses and roads of Chippendale, an area that is 0.7 of a square kilometre.
When valued at the same price charged for town water the wasted rain water is worth $2,016,300 ($2.35 a thousand litres).
Each year 738 million litres of town water is imported through thousands of kilometres of pipes from distant dams and rivers to Chippendale residents who are charged $1,734,300 for it.
The dirty energy used to pump the water puts the government-owned town water provider, Sydney Water, in the top 20 climate polluters of NSW.
In heavy rain sewage overflows from Sydney Water’s sewage pipes - 8.5m litres of sewage runs on streets to pollute Sydney Harbour and the ocean. This pollution stops if rainwater is kept where it falls instead of running into leaking drains and sewers.
Why is rain ignored in water pricing when in other states it’s a valued, harvested resource?
Why is rain kept on properties in Western Australia’s capital city of Perth to feed aquifers below (which supply the city’s town water)?
Why in South Australia’s capital city of Adelaide do 47 per cent of houses have rain tanks for all household water uses?
Sydney can cut household bills and can match Adelaide and Perth if the state government and it’s (captured) regulator choose to promote competition in the form of rain tanks and other conservation pricing methods.
• More rain falls and is wasted in Chippendale than is imported - at a fee - as town water - and property owners get charged a fee for wasting it Drawing by Mat Faint
The government can choose to promote rain as an addition or substitute for town water but water is presently priced by a state regulator so as to cement the business of the government monopoly, Sydney Water.
In 1992 the state government created a regulator to end market power abuses by government monopolies like Sydney Water.
When introducing the law to Parliament creating the Independent Pricing and Regulatory Tribunal (IPART - the regulator) and giving it criteria to consider when making prices, then Premier of NSW, Nick Greiner said:
“Many government businesses in New South Wales are monopoly suppliers of services, notably, electricity, water and transport. As a result, these agencies are not subject to competitive forces and are able to set their prices without reference to the prices of substitutes for their services. In the absence of regulation these monopolies can charge prices which are higher or lower than they would be if set in a competitive market.
. . . The pricing tribunal established by this bill with power to review and determine prices charged by monopolies will ensure that monopolies do not abuse the power which they have by being the sole supplier of a good or service. . . .
The tribunal will, therefore, be constrained by strict efficiency and cost issues but will take a broader range of matters into account when making determinations and recommendations. This will ensure that environmental and social issues form part of the equation and the tribunal will need to weigh these matters against strict cost-related factors. Honourable members would be aware that any reasonable analysis of the price or pricing structure of monopoly services, such as electricity, water and sewerage, must take into account the externalities relevant to the supply of the services. The cost of avoiding or minimising any environmental damage which might occur as a result of the supply of monopoly services should be taken into account when determining the appropriate price to be charged. This action will promote sound environmental practices and decisions as well as determining economically appropriate prices for the benefit of the people of this State. It will be a further factor operating to discourage and minimise environmental degradation.”
The Premier, and Parliament, expected the regulator to include in its prices “externalities . . . {which are] the cost of avoiding or minimising any environmental damage which might occur as a result of the supply of monopoly services”. (Legislative Council 5 March 1992, Hansard p26)
But, in defiance of Parliament’s expectations, the “costs of avoiding or minimising’ the environmental damage caused by Sydney Water are not considered by the regulator - Independent Pricing and Regulatory Tribunal - and include for Chippendale:
• combined sewage and stormwater pollution overflows to the harbour and ocean of 8.5m litres a year, and for which there is no Environment Protection Authority (EPA) licence;
• stormwater pollution to the harbour – over 800 m litres a year, no EPA licence;
• less tree canopy and consequential higher human mortality rates and higher energy bills for air conditioning;
• avoidable costs for stormwater works and maintenance;
• avoidable water and sewage bills through rain tank and recycled water use by residents and businesses;
• preventable premature human mortality costs.
The state government could remedy the Tribunal’s water pricing decision this year and request the Tribunal to amend its prices for Sydney Water to include external costs. By doing so Sydney could catch up to rainwater use in two state capital cities, Adelaide and Perth.
Tribunal decisions are amenable to judicial review (for example, for failing to take into account required statutory considerations). If the government does not act any citizen may seek a court ruling about the validity or otherwise of any of its pricing decisions. A recent example is a 2021 court’s decision saying the state government’s Environment Protection Authority failure to take into account, or to have in place, long term climate policies about climate change meant its grant of a coal mining licence was invalid.
How might the regulator count the costs of preventable premature human mortality?
Researchers at the Portland Forestry Science Lab of the US Forest Service have discovered a direct, statistical connection between planting street trees and lower mortality.
Street trees save human lives.
Tree roots suck water up from below roads, road verges, paths, gardens; trees grow more when planted in city streets and private land which are built and maintained to harvest that rainwater, not waste it.
The Victorian Health agency says:
• “Heat kills more Australians than any natural disaster.
• Heatstroke is fatal in up to 80% of cases.
• Heat-related illness can be prevented.”
None of these costs or benefits are considered by the regulator.
Sydney Water has captured the regulator and together the regulator and the regulated business grows the monopoly business by pricing stormwater as if it were an unavoidable waste.
It isn’t, rainwater is a competitor - ask Adelaide and Perth.
As my house has demonstrated for 27 years, and as the other state capital cities of Perth and Adelaide see it, rainwater is valuable.
Another external cost of Sydney Water’s services is it’s greenhouse pollution which huge pumps cause by pumping billions of litres of sewage and water through over 23,000 kilometres of pipes.
Weekly news shows Earth’s climate pollution is increasing and climate collapse is speeding up.
• Sydney Water is in the top 15 greenhouse polluters in NSW because of the huge pumps pumping water through 23,000 k of pipes and almost no clean energy being used
By pumping water and sewage through thousands of kilometres, including to Chippendale, Sydney Water put 358,858 tonnes of climate pollution into Earth’s air in 2019.
The regulator does not set prices to stop or reduce the town water provider’s greenhouse pollution but it was the clear expectation of Parliament in 1992 that it would.
To remedy the damage being done by water prices set without factoring in Sydney Water’s climate pollution its urgent the state government this year directs the regulator to do what the Parliament said it should do when setting water prices: include environmental costs.
Households can be the best competitors to Sydney Water. On the same roofs where rain falls, spurred by high energy prices and desire to cut pollution, 30.33 % of Australian households make free electricity with solar power. NSW households do this without the NSW regulator as it does not set energy prices. Those households may also chose to harvest rain from the roof if the Tribunal liberates them from narrowly-based water prices and seeks a market similar to the energy market.
(Maybe householders would save more money if the water market was like the solar market and also not regulated by IPRT?)
I’ll ask a government shareholder in Sydney Water, the state Treasurer, Mat Kean, and the Premier, Dominic Perrottet, to direct the regulator to revise water prices to include environmental costs. I’ll suggest to Mat Kean and Dominic Perrottet they direct Sydney Water and IPRT to increase the resilience of Sydney’s water supply by implementing these priority actions this year:
• All new subdivisions from one to two lots and more, and subdivisions being built (where feasible), to keep all rain where it falls to drain passively to irrigate street trees, road verges, parks and to involve and educate local communities in the design, construction and planting of the subdivisions and drainage;
• Various reductions in developer charges, local council stormwater charges and local council rates for existing and future properties which keep all rain on site by simple, proven, low cost solutions such as leaky drains and leaky wells.
• A rain tank rebate of up to $5,000 for tanks of 10,000 litres and greater capacity once they have been installed and connected to the house water supply with low level town water backup supplemented by electronic metering;
• An exemption from any stormwater charges by both Sydney Water and the local council so long as the rain tank remains connected and in use and for any existing rain tanks in use whether or not the property is connected to Sydney Water;
• IPRT to report publicly in the first half of 2023 about the cultural, education and water industry lessons which underpin the long term use of rain tanks by 47 per cent of house in Adelaide and the requirement for properties in Perth to keep rain on the property site and, using that information, to provide the government with an education and skills program in 2023 which it can implement this year in NSW schools, TAFEs and universities about how NSW citizens may keep rain where it falls. The report will include data on existing projects in NSW and Sydney which keep rain on site and resemble the different priorities given to rain in Adelaide and Perth.
You can also ask the Treasurer and Premier to act, too, whether or not you live in Sydney, as the Tribunal sets water prices across NSW.
May the rain drops stay where we live and work, and fill our glasses, free and clean.
Michael Mobbs