The Queensland Competition Authority (QCA) has found Unitywater
is undercharging its customers by approximately $57 million – or
the equivalent of more than $200 per household – in
The findings were detailed in the independent regulator’s Interim Price Monitoring Report released on 3 April.
The report also found that Unitywater made efficiencies in its forecasted operating costs for 2011-12 and that revenues from non-capped charges, such as trade waste, fell despite their increasing operating costs for the water retailer.
Unitywater CEO Jon Black said that while the company was currently under-recovering from its customers, he was very conscious of the pain many families were feeling from bills. He was keen to keep driving down operating costs while continuing to provide high-quality, environmentally and economically sustainable water and sewerage services.
“Unitywater is currently under-recovering on its costs and this does present a challenge for our long term sustainability and returns to the owner councils. However we believe we are responsibly managing this challenge and remain mindful of the impacts rising costs have on our customers,” Mr Black said.
The QCA compared Unitywater’s forecasted earnings from water and sewerage services against the maximum allowable revenue (MAR), according to an estimate of the ‘efficient cost of providing services’.
Unitywater’s forecast revenue for 2011-12 was $398.4 million, while the QCA found $455.3 million was the maximum allowable figure.
Of this, the forecast water revenue of $195.7 million was below the authority’s MAR of $238.8, while forecast sewerage revenue of $202.7 million was below the authority’s MAR of $216.4 million.
The report said there was no evidence of an exercise of monopoly power and found Unitywater’s $268.73 million capital expenditure to be prudent and efficient.
The authority also expressed support for Unitywater’s efforts ‘to seek collaborative and cost-effective solutions for maximising water quality improvement and achieving healthy waterways’.
Unitywater provides water supply and sewerage services to the Sunshine Coast and Moreton Bay regions and is wholly-owned by the Councils of those regions.