Updated: February 2018
“Australia is facing unprecedented challenges when it comes to how we plan and manage our water resources. The nation’s future prosperity is inextricably linked to how well our water resources will meet the needs of a growing population, diversified industries, and protection of the environment. Climate change and rainfall variability are placing increasing pressures on every aspect of the water industry as it grapples with aging infrastructure and increasing urbanisation.”
– AWA and Arup, Australian Water Outlook 2016
Essentially a natural monopoly, the water industry is dominated by a small number of State Government corporations. Fixed infrastructure and regulation in water supply restricts the number of suppliers in the industry. Governments regulate prices to benefit consumers and the industry alike, with recent water price rises being implemented to cover the cost of additional infrastructure investment. Traditionally run by Local Government, authorities have been amalgamated and centralised into larger State Government corporations. The arguments for centralisation are primarily based on greater economies of scale, efficiency gains and building a solid skills base.