NSW State of the Environment 2012

SoE 2012 > People and the Environment > 1.4 Urban water

People and the Environment chapter 1

1.4 Urban water

The quality of drinking water in New South Wales remains very good. The efficiency of water use and security of supply continue to improve.

Water from the state's two major metropolitan water utilities meets the Australian Drinking Water Guidelines. Drinking water supplied by regional local water utilities also meets the guidelines in over 99% of samples.

Progress on reducing water consumption per person continues: while the population across Sydney Water's operating area has grown about 21% over the past two decades, total water use has declined by about 25%.

Regional local water utilities have reduced average annual residential water use by 52% over the last 20 years.

NSW indicators

Notes: Terms and symbols used above are defined in About SoE 2012 at the front of the report.

Introduction

One of the greatest challenges facing NSW is a continued reliable access to water. Ensuring a secure, sustainable and equitable water supply for people, agriculture, industries and the environment is a key goal of government. In the context of the recent drought and the projected impact of climate change, the importance of securing a sustainable water supply has never been greater.

Status and trends

Urban drinking water quality

The NSW Government has endorsed the Australian Drinking Water Guidelines as the benchmark for the provision of water to the people of NSW (NHMRC & NRMMC 2004). These guidelines promote a preventative risk management approach for drinking water quality, from the catchment to the household.

NSW drinking water quality in metropolitan areas has continued to meet the standards set by these guidelines, with all water supplied by Sydney Water and Hunter Water meeting the microbiological and chemical water quality guideline requirements. Drinking water compliance with microbiological indicators has been maintained, while compliance with chemical indicators for most local water utilities (LWUs) improved between 2004–05 and 2010–11.

Ninety-nine per cent of the over 25,000 samples taken at 95 LWUs complied with the chemical standards. Similarly, 99% of more than 21,000 samples from LWUs also complied with the microbiological standards. Overall, 88 LWUs had 100% compliance with the standards (NOW 2012a, Table 12).

Sources and volume of water drawn

Tracking the volumes of water from a range of sources, such as surface water storages (drinking water supply dams), groundwater aquifers and recycled water schemes, provides the basis for sustainable water management. Except for the water utilities servicing the greater metropolitan region (GMR₂) and central coast, most NSW water utilities have reduced the total volume of water they draw from environmental sources (groundwater and surface waters, such as reservoirs and pumping from rivers) since 2007–08 (Table 1.6). Across the western slopes and plains, and in the larger coastal catchments, groundwater is often a significant component of urban water supplies. In areas where groundwater availability is low, recycling of water tends to be more developed.

Table 1.6: Total urban water volumes by source for Sydney Water, Hunter Water and LWUs

Source: DWE 2009a, Table 8; NOW 2010, Table 8; NOW 2011a, Table 8; NOW 2012a, Table 8

Notes: All volumes are in megalitres (ML)
Does not include water supplied for non-urban uses, such as irrigation.
LWUs included have more than 10,000 connected properties. Data for the smaller LWUs are available in the source tables.
* Desalination water

Recycled water

While recycled water contributes a small portion of the total water supply, metropolitan water utilities are increasing their recycling efforts (Table 1.6). Around 14.8% of water supply came from recycling in 2010–11, up from 2.9% in 2005–06 and 4.7% in 2007–08. In 2010–11, recycled water projects in Sydney Water's area of operations produced approximately 50 gigalitres (GL) of recycled water (1 GL = 1000 ML). These projects include:

• the largest residential recycled water scheme in Australia at Rouse Hill which currently supplies around 2.2 GL a year to more than 20,000 homes, eventually expanding to around 36,000 homes
• recycling of 7.1 GL of water per year for industrial use by BlueScope Steel in Wollongong, together with a further 500 ML of highly treated, disinfected recycled water supplied to the Port Kembla Coal Terminal and the local golf club and sports fields
• supplying water from the St Marys water recycling plant to help maintain the flow of the Hawkesbury–Nepean River, reducing the volume of nutrients in the river and making more water in Warragamba Dam available for drinking
• the supply of recycled water by Sydney Water to irrigate farms, golf courses, sports fields, parks and a racecourse in the Sydney region (about 5.6 GL in 2009–10).

In 2010–11, 81% of non-metropolitan LWUs recycled effluent (NOW 2012a, Table 8). A total of 37 GL of water was recycled, about 20% of the volume of sewage collected. Most of this recycling was for agricultural purposes, with 7.6 GL recycled for urban uses. The highest volume recycled by a non-metropolitan utility was 5.25 GL at Tamworth (although none was for urban use).

Pressures

Climate variability and climate change influence the availability of water, its sources and its consumption. Water availability depends on rainfall and temperature: the volume of water held in storages varies with climatic conditions, partly because of changes to rainfall, evapo-transpiration and runoff (see Water 4.1) and also because hotter, drier conditions increase the watering of lands and use of evaporative coolers.

In addition, there is constant pressure on water supplies from the demands of a growing population.

Water demand

Water has not always been used efficiently by all sectors. However, as a result of education campaigns by the NSW Government and water authorities in recent years, along with new water pricing arrangements, community attitudes are changing and water is more likely to be viewed as a valuable resource. For example, the Sydney metropolitan community has responded well to water restrictions and demand management programs and this has contributed significantly to water savings. However, further reductions in water use in all sectors of the community are required to meet future demand in NSW.

Sydney and Lower Hunter metropolitan areas

Between 1990–91 and 2003–04, Sydney Water delivered between 550 and 650 GL per year of potable water to all users (residential, industrial, commercial and government) across its areas of operation – Sydney, the Illawarra, Blue Mountains and adjacent areas. This declined to a low of 481 GL per year in 2007–08 (excluding recycled water) and has been about 500 ± 5 GL since. This sustained decline is primarily due to restrictions and demand management programs, which include water efficiency and leakage reduction programs, and water recycling.

Water consumed as a proportion of the long-term sustainable yield has fallen from over 100% prior to 2004–05 to 88% in 2010–11. This translates to a daily potable water consumption pattern that has been steadily declining, down from 343 litres per person in 2004–05 to 303 L in 2010–11. This figure is well below the water conservation target in Sydney Water's operating licence of 329 L per person per day by 30 June 2011 and was achieved five years early. Despite a population increase of about 21% over the past two decades, total water use has declined by about 25%.

The trend in potable water consumption per person from 1995–96 to 2010–11 shows the effect of voluntary and mandatory water restrictions and demand management programs over this period. The data demonstrates the success of sustainable water-use programs in preserving water supplies (Figure 1.17).

Figure 1.17: Demand for potable water, Sydney Water (1996 to 2011) and Hunter Water (2002–03 to 2010–11)

Source: NWC 2009; Hunter Water 2011; NWC 2011; Sydney Water data 2012

Notes: For Sydney Water data, the year shown is as at 1 January; for Hunter Water data, financial years are shown.

Over the past 10 years, Hunter Water has drawn between 69.5 and 79.6 GL of potable water per year across its areas of operation, comprising the local government areas of Newcastle, Lake Macquarie, Maitland, Cessnock, Port Stephens and Dungog. Over the past nine years, daily potable water consumption has declined by about 12% despite population growth of 10% and per-person potable water consumption falling around 20% (Figure 1.17).

Residential water use

The average annual volume of residential water supplied by local water utilities (LWUs) to connected residential properties in regional NSW has fallen 52% over the last 20 years (from a median of 330 kilolitres per connected property in 1991–92 to 159 kL in 2010–11). This equates to a water saving of 140 GL per year.

In Sydney, the Illawarra and Lower Hunter, the residential sector is the largest water user, accounting for around 65–75% of total water consumed. In regional NSW, the residential sector accounts for two-thirds of total water consumed (NOW 2012a, Table 8).

In regional areas, the average annual residential water consumption per connected property decreased significantly for most LWUs between 2004–05 and 2010–11 (Figure 1.18). For example, the median residential water use in 2004–05 was 200 kL per connected property, compared with 159 kL in 2010–11.

Figure 1.18: Average annual per-property residential water consumption by LWU

Source: DWE 2009a, Table 10; DWE 2009b, Table 10; NOW 2010, Table 10; NOW 2011a, Table 10; NOW 2012a, Table 10

Notes: LWUs included have more than 10,000 connected properties. Data for the smaller LWUs are available in the source tables.
The Hunter Water supply network interconnects with adjacent LWUs, enabling it to supply and receive bulk treated water from Wyong and Gosford councils and Midcoast Water.

Responses

Existing responses

NSW 2021: A plan to make NSW number one (NSW Government 2011), the Government's 10-year plan for NSW, addresses the challenge of water management by describing a delivery framework and targets to guide decision-making in water resource allocation and management. There are three distinct components to water management in NSW:

• metropolitan water use (Sydney, the Illawarra, the Blue Mountains and adjacent areas)
• urban water use in regional areas (Hunter Region, Central Coast and country towns)
• rural water use (see Water 4.1).

One of the most significant changes to the management of water in NSW has been the adoption of statewide goals and targets through NSW 2021. For both metropolitan water use, and urban water use in regional areas, this includes Goal 21 – 'Secure long-term potable water supplies for towns and cities supported by effective effluent management'.

The relevant priority action under the goal is: 'Deliver the Country Towns Water Supply and Sewerage Program which supports the provision of water and sewerage services, including funding towards the capital cost of priority backlog water and sewerage infrastructure; providing emergency drought assistance; monitoring and reviewing the performance of utilities and advising on improved operation of utilities; and managing dams, weirs, water treatment, and sewage treatment facilities.'

Water sharing plans

Water sharing plans provide the statutory framework for allocating water to different types of users (town water supply, industry and irrigation) and the environment. By setting the rules for how water is shared, these plans provide a decade of security for the environment and water users. Sixty-three water sharing plans have already been developed for many areas in NSW, covering both surface and groundwater systems. About 95% of water use in NSW is now covered by a water sharing plan (see Water 4.1).

Metering of water extraction from rivers by large- and medium-scale users with entitlements is currently being implemented with large-scale users now reporting water use every three months and medium-scale users preparing regular estimates of water use.

Metropolitan water use

Metropolitan water plan: 2010 Metropolitan Water Plan (NSW Government 2010b) sets out how the NSW Government will provide a secure and sustainable supply of water to meet the needs of Sydney, the Blue Mountains and the Illawarra. There are four major parts of this plan to secure 'Water for Life': dams, recycling, desalination and water efficiency. These measures, together with the plan's adaptive management approach, mean that Sydney's water needs are secured for future drought, a changing climate and a growing population.

The NSW Government has a target of being able to deliver 70 GL of recycled water in greater Sydney by 2015. Existing or planned large-scale recycling schemes include those at the Rouse Hill, Hoxton Park, St Marys and Wollongong sewage treatment plants (see 'Recycled water' under Status and Trends).

From January 2010, the desalination plant at Kurnell in Sydney became operational in line with the terms of the 2010 Metropolitan Water Plan. The plant will operate at full capacity when dam levels fall below 70% and continue to supply water until storages reach 80%. The plant is currently able to deliver up to 250 ML of water a day, although the intake and delivery pipes have been sized so output can be doubled if necessary.

Water efficiency measures are another important response component. Improvements in water efficiency can be achieved by installing more efficient appliances, educating the community and modifying processes to help use water wisely (see also 'Demand management initiatives' below).

Water restrictions and Water Wise Rules: In June 2009, the NSW Government introduced permanent Water Wise Rules for Sydney, the Blue Mountains and the Illawarra (see Figure 1.17). The rules are simple, commonsense actions designed to ensure that the water conservation measures adopted during times of drought continue. Sydney Water estimates that the enforcement of its Water Wise Rules saves approximately 19 million GL of water every year. Other parts of NSW also experienced an extended period of water restrictions.

Along with restrictions to keep more water in dams during droughts, work has also been undertaken to gain access to deep water in dams and replenish storages with groundwater reserves if needed.

Lower Hunter region: In 2003, Hunter Water prepared its first Integrated Water Resource Plan (IWRP) under the 2002–07 operating licence. The subsequent licence issued by the NSW Government required Hunter Water to review the IWRP. Following the review, the H₂50 Plan (Hunter Water 2008) was released, outlining the long-term drinking water supply strategy for the Lower Hunter region.

A new Lower Hunter Water Plan is currently being developed by the Metropolitan Water Directorate in line with the Council of Australian Government's agreed National Urban Water Planning principles. It will ensure there is adequate water for the region's needs, both in drought and in the longer term, to support predicted growth in population and industry.

Demand management initiatives

Water pricing for urban customers has undergone significant reform, with a shift in tariffs away from a reliance on fixed annual charges to 'pay-for-use' pricing. This pricing reform is overseen by the NSW Independent Pricing and Regulatory Tribunal (IPART) and has contributed to the reduction in water consumption by more accurately reflecting the value of water resources and the true costs of supplying water.

During drought, education and training programs targeted all sectors across the Sydney metropolitan region. The Water for Life education program is an integral component of the Metropolitan Water Plan. The focus of Water for Life is to support and encourage the Sydney community to play its part in water planning and use water wisely.

Water Savings Action Plan requirements were established in 2005 under the Energy and Utilities Administration Act 1987. In Sydney Water's area of operations, action plans were required by all local councils, businesses and government agencies that use more than 50 ML of water per year per site. The plans involved assessing current water use and identifying cost-effective measures to reduce water consumption. All 298 action plans were approved by 30 June 2009. They contained 2329 cost-effective measures that organisations could implement to save an estimated 8272 ML of water each year. By 30 June 2011, 48% of cost-effective water measures had been implemented.

Year-by-year water efficiency programs and recycling have saved an increasing volume of drinking water across Sydney Water's areas of operation, with 55.839 GL saved in 2010–11 (Sydney Water 2011a). Sydney Water has implemented residential demand management programs, including WaterFix, to assist households to conserve water. This involves specialists from Sydney Water visiting residents and helping them make changes to their homes and gardens to use water more efficiently. The Every Drop Counts Business Program involves targeted water conservation programs for small business users and offers free one-on-one partnerships to larger businesses who use more than 80,000 litres of water per day.

Another Sydney Water initiative is a program to actively detect and repair leaks. In 2010–11, leakage was estimated to account for 106 ML per day (38.6 GL per year), about 7.77% of potable water used. This was a significant reduction on the leaks in 1999–2000 which wasted over 180 ML of water a day. Since 2008, Sydney Water has been within its target band for water lost by leakage (105 ± 16 ML per day) (Sydney Water 2011b).

Sydney Water has 18 recycled water schemes. In 2010–11, more than 9% of total wastewater collected was recycled (47.521 GL). The St Marys Water Recycling Plant, which began operating in mid-2010, is Sydney's largest water recycling project. It is a key element of the NSW Government's Metropolitan Water Plan, which includes increasing water recycling capacity in Sydney Water's area of operations to 70 GL per year by 2015. Water from the plant currently replaces water that would otherwise be released from Warragamba Dam for environmental flows. As well as saving drinking water, it reduces nutrient discharge, which in combination with increased environmental releases from upstream dams, contributes to the downstream health of the Hawkesbury–Nepean River system.

Urban water use in regional NSW

Country Towns Water Supply and Sewerage Program: This program is a major State Government reform that aims to assist NSW regional local water utilities (LWUs) provide appropriate, affordable, cost-effective and sustainable urban water supply and sewerage services.

Through the comprehensive NSW Best-Practice Management of Water Supply and Sewerage Framework (NOW 2011b), the program provides leadership, guidance and technical assistance to LWUs and oversees and monitors their performance. The key requirements of the framework include:

• strategic business planning
• sound pricing of water supply, sewerage and trade waste services to achieve full cost recovery and provide strong pricing signals to encourage efficient use of the services
• performance monitoring by each LWU using the NSW performance monitoring and benchmarking system
• integrated water cycle management to assist local water utilities achieve sustainable, affordable and cost-effective water supply, sewerage and stormwater services over 30 years or longer.

Financial support is also provided in the form of grants towards the capital cost of works to address any backlogs in water supply and sewerage infrastructure needed to deliver improved public health, environmental outcomes and security of supply to more than one million people in NSW country towns.

Since its commencement in 1994, the program has spent over $945 million to complete more than 475 water supply and sewerage projects with a projected spend exceeding $1.2 billion by the scheduled end of the program in 2016–17.

Pricing: Having strong water pricing signals has been of strategic benefit in achieving efficient water use in regional NSW and has even resulted in a slight reduction in the typical water supply residential bill over the last 16 years. In 1996–97, 68% of the regional NSW LWUs had a 'free water allowance'. However following its gradual removal by July 2007, the median residential water usage charge rose slowly to 180 cents per kilolitre in 2011–12 (Figure 1.19). In addition to helping achieve a steady reduction in the residential water supplied per property, strong pricing signals over the last decade have also enabled regional NSW LWUs to avoid over $1 billion in capital expenditure for augmenting headworks and treatment capacity. Moreover, prices that reflect the true value of water have helped drive its efficient use to the point that the 'typical' residential customer has, overall, maintained the real price of their water supply bill over the past 16 years, about $445 per connected property (Figure 1.19).

Figure 1.19: Average annual residential water supply vs residential water costs

Source: NOW 2012b

Notes: Inflation corrected dollar values (as at January 2012).

Other government responses

NSW Government: The Building Sustainability Index (BASIX) for new homes was introduced in 2004 to ensure homes are designed to use up to 40% less urban water than the average dwelling built before its introduction. Based on commitments being reported through BASIX, the average potable water use in a compliant NSW home is approximately 135 L per person per day. For commitments made on BASIX certificates issued between July 2004 and December 2011, new BASIX-compliant homes are saving NSW an additional 13 GL per year with cumulative water savings across the state forecast to reach 45 GL in 2011. These figures do not include water efficiencies from BASIX-compliant alterations and additions, which will add further savings.

Established in 2007, the NSW Climate Change Fund provides funding for business, households, schools, communities and government to save water and energy. The NSW Home Saver Rebates program, which ended as scheduled on 30 June 2011, provided rebates for water-efficient washing machines, dual-flush toilets, hot water circulators, and rainwater tanks (see also People and the Environment 1.6). Water recycling and stormwater harvesting schemes, and water saving projects have been funded through the Water Savings Fund, Central Coast Water Savings Fund, the Rainwater Tanks in Schools, NSW Green Business and Public Facilities programs. To 30 June 2011, the Climate Change Fund had supported projects that will save more than 19 GL of water per year (OEH 2011) (see also People and the Environment 1.2).

The Urban Sustainability Program aims to facilitate projects of significant environmental benefit that are delivered by local councils in partnership with other government agencies, local businesses, community organisations and householders. It provides funding for urban water management projects that have a particular focus on stormwater and urban runoff to achieve sustainable water quality and conservation outcomes.

Sustainability Advantage is designed to leverage the growing business interest in sustainability, particularly among medium and larger organisations. It focuses on industrial ecology projects among businesses keen to exploit opportunities for the exchange of materials, energy, water and by-products. The program integrates water conservation issues into broader sustainability projects, with an emphasis on 'business value', such as reduced costs, improved reputation and increasing productivity, while making environmental gains (see also People and the Environment 1.6).

Federal Government: The National Australian Built Environment Rating System (NABERS) is a NSW program which rates buildings on the basis of their measured environmental impacts, such as energy, water, stormwater runoff and pollution, sewage, landscape diversity, waste and toxic materials, and provides an indication of how well they are being managed. NABERS is managed by the NSW Office of Environment and Heritage (OEH) on behalf of the National Steering Committee (comprising state and federal governments).

NABERS Water ratings are available for commercial office buildings, hotels, shopping centres and homes. OEH is working with the NSW Department of Education and Communities to develop a rating for NSW schools and with NSW Health to rate public hospitals.

In 2010–11, 431 NABERS Water ratings were issued. Close to 600 businesses are engaging with NABERS to rate their premises. NABERS has driven substantial efficiency gains in the built environment. On average, office buildings using NABERS to measure and manage their water use have improved their water efficiency by 9%. Altogether these buildings are saving 1100 ML of water each year.

Under the national Water Efficiency Labelling and Standards (WELS) Scheme, registration and water efficiency labelling of washing machines, dishwashers, toilets, urinals, taps and showers is mandatory and the introduction of water efficiency labelling of combined clothes washer–dryers is currently being considered (DEWHA 2008a). At present only toilets are subject to minimum water efficiency standards. Through its participation in the WELS Scheme, the NSW Government proposes introducing minimum standards for washing machines and dishwashers.

The National Water Initiative (NWI) is a shared commitment by governments across Australia to increase the efficiency of water use and provide greater certainty for investment and productivity for communities and the environment. The urban water component of the NWI focuses on the need to secure urban water resources by improving the reliability of supply, water efficiency and integrated water planning (NWC 2008). The NSW Implementation Plan for the National Water Initiative (NSW Government 2006) contains specific actions for implementing the NWI's eight key elements. All 32 eligible NSW urban water utilities have met the rigorous national auditing requirements and reported on their performance in the National Performance Report 2010–11: Urban water utilities (NWC 2012).

Developing responses

Local water utilities inquiry: In September 2007, the NSW Government commenced an independent inquiry into secure and sustainable urban water supply and sewerage services for non-metropolitan NSW. The inquiry is part of an evolving process of reform for the provision of water supply and sewerage services to non-metropolitan NSW. It builds on the reform agenda of the National Water Initiative that is currently being implemented through the Best-Practice Management of Water Supply and Sewerage Framework (NOW 2011b) used in the NSW Government's Country Towns Water Supply and Sewerage Program.

The report from the inquiry (DWE 2009c) recommends the consolidation of water supply and sewerage providers and the adoption of new organisational structures. The report also recommends strengthening the regulation of water supply and sewerage providers, streamlining regulatory reporting and procedures, and appointment of an ombudsman to enhance consumer protection if it can be demonstrated that there are net benefits in doing so. The NSW Government is currently developing a response to the recommendations of the inquiry.