Developer charges and pricing

Best practice pricing for water supply, sewerage and trade waste provides suitable pricing signals to enable customers to balance the benefits and costs of their use of water services and ensures efficient use of the services. It is required for effective and sustainable management of water supply and sewerage businesses and minimisation of customer bills.

Best practice pricing is a key requirement of the National Water Initiative (NWI), 2004 the Council of Australian Governments' Strategic Framework for Water Reform, National Competition Policy and the NWI Pricing Principles, 2010.

We provide financial planning and pricing software, expert advice, training, user support and facilitates the use of these tools by local water utilities to achieve best practice pricing in accordance with the outcomes required by the NSW BPM of Water Supply & Sewerage Guidelines (PDF, 1764.65 KB)

Developer charges

Developer charges are up-front charges that a LWU can levy under section 64 of the Local Government Act 1993 to recover part of the infrastructure costs incurred in servicing new development or additions and changes to existing development.

Developer charges serve three related functions:

  1. they provide a source of funding for infrastructure required for new urban development;
  2. they provide signals regarding the cost of urban development and thus encourage less costly forms and areas of development; and
  3. are an integral part of the fair pricing of water related services

2016 Developer Charges Guidelines

The 2016 DCG for Water Supply, Sewerage and Stormwater (PDF, 4362.04 KB) have been approved by the Minister for Lands and Water pursuant to section 306 (3)(C) of the Water Management Act 2000. These guidelines modify and supersede the Water Supply, Sewerage and Stormwater Developer Charges Guidelines, 2002 and incorporate feedback and recommendations from the industry consultation.

Unless a consultant had already been commissioned, preparation of all new Development Servicing Plan documents commenced after July 2016 must be in accordance with the 2016 guidelines. A Development Servicing Plan documents all the relevant information used to calculate the developer charges. The guidelines define requirements and provide guidance on preparation of a development servicing plan (DSP) document, analysis, audit, implementation and administration of appropriate developer charges to ensure that new development meets a fair share of the cost of service provision.

A key requirement of the 2016 guidelines is an independent audit of the DSP document.

LWUs with growth of fewer than five lots per annum are exempted from the requirement to prepare a DSP document.

Water supply and sewerage pricing

Water supply pricing

With water becoming an increasingly scarce resource both locally and globally, it is appropriate that local water utilities focus on influencing water demand through increasing emphasis on usage based pricing. Best practice water supply pricing requires utilities to provide strong pricing signals to encourage efficient water use.

It is important that all of the regional local water utilities achieve full cost recovery for water supply sewerage service as required by the NSW BPM of Water Supply & Sewerage Framework (PDF, 23.9 KB)

Sewerage pricing

Best practice sewerage pricing involves a uniform annual sewerage bill for residential customers. For non-residential customers, a suitable sewer usage charge is required for the estimated volume discharged to the sewerage system, together with an access charge based on the capacity requirements that
their loads place on the system relative to residential customers.

Liquid trade waste pricing

Best practice liquid trade waste pricing involves commercial fees and charges to encourage cleaner production, efficient use of sewerage infrastructure and compliance with the conditions of approval issued to each trade waste discharger, in accordance with the Liquid Trade Waste Regulation Guidelines (PDF, 15374.2 KB)