Tasmania’s draft water price determination has set out a significantly different path for TasWater’s next regulatory period, proposing lower annual price increases while spreading major infrastructure investment over a longer timeframe.
The Tasmanian Economic Regulator has released its Draft Report and Proposed Price Determination for water and sewerage services from July 1, 2026, to June 30, 2030, opening a new consultation phase for customers, industry stakeholders and government.
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What the draft decision proposes
Under the draft decision, water and sewerage prices would rise by an average of 4.3 per cent per year over four years. This is well below the 8.8 per cent annual increases proposed by TasWater and materially lower than the price path implied by the utility’s full capital program.
For customers, the regulator estimates this would translate to an increase of around $54 for an average residential household in 2026–27, while a typical small business would see an increase of about $112.
Tasmanian Treasurer Eric Abetz said the draft outcome reflects the purpose of independent regulation.
“The Regulator has undertaken a rigorous assessment of TasWater’s proposal, including its operating and capital programs, pricing structure and long-term financial assumptions,” Abetz said.
“This is exactly why Tasmania has an independent economic regulator. It protects consumers, strengthens accountability and ensures decisions are based on evidence.”
Reassessing the scale and pace of investment
TasWater’s Price and Service Plan proposed around $2.8 billion in expenditure over four years, representing the largest capital investment program in the utility’s history.
While the Economic Regulator acknowledged the need to modernise ageing water and sewerage infrastructure, the draft decision concludes that delivering the full program within a single regulatory period would place excessive pressure on customer bills.
Instead, the regulator has proposed extending delivery of major capital works across two regulatory periods, allowing essential upgrades to proceed while moderating near-term price impacts.
Operational expenditure allowances have also been adjusted, including changes to proposed wage growth and efficiency assumptions.
Economic Regulator Joe Dimasi said the draft decision reflects the challenge of balancing affordability with long-term asset stewardship.
“Our role is to ensure customers pay no more than is necessary to fund efficient service delivery, while also making sure TasWater can invest appropriately in critical infrastructure,” Dimasi said.
Consultation and accountability
The draft determination follows the regulator’s description of the most extensive consultation undertaken for a Tasmanian water price review, with a record number of submissions from customers and stakeholders.
Abetz encouraged continued engagement ahead of the final decision.
“This is a critical service and the process benefits from informed community input,” he said.
The consultation period will remain open until 13 March 2026, with the final determination scheduled for release in May ahead of the new regulatory period commencing on July 1.