Economic Regulator Halves Proposed TasWater Bill Increases

Tasmanian households and small businesses will experience lower increases in water and sewerage bills than initially proposed by TasWater, following a decision by the state's Economic Regulator. Regulator Joe Dimasi rejected TasWater's proposal for 8.8% annual fee hikes over the next four years, instead approving an average rise of 4.3%.

Bill Impact for Households and Businesses

For the 2026-27 financial year, residential bills are projected to increase by $54, which is less than the $91 increase TasWater had proposed. Small businesses will see a $112 increase, down from a proposed $251.

TasWater's Proposal and Regulator's Rationale

TasWater, co-owned by local councils and the state government, had sought the higher increases to fund approximately $1.7 billion in infrastructure upgrades from 2026-2030. These planned improvements include significant works at Hobart's Ridgeway Dam and Pet Dam at Burnie. The company reported that only 9% of its treatment plants currently comply with all environmental licence conditions.

Mr. Dimasi stated that it was "not prudent" for TasWater to attempt all proposed works within a four-year timeframe, suggesting a longer implementation period.

He acknowledged the "real and ongoing" challenges in modernizing Tasmania's aging water and sewerage infrastructure, noting that his decisions aim to balance customer affordability with the necessity for infrastructure investment.

Additionally, the economic regulator supported changes to TasWater's tariff structure to reduce the proportion of fixed charges, but recommended a slower implementation than initially proposed by TasWater.

Reactions

TasWater CFO Kane Ingham stated the company would analyze the draft decision and assess its implications for infrastructure. Mr. Ingham highlighted the risks associated with delaying projects, including potential failures in aging infrastructure and increased costs over time.

Tasmanian Treasurer Eric Abetz welcomed the draft decision, commending the regulator's assessment. He emphasized the regulator's role in consumer protection, accountability, and ensuring evidence-based decisions. Labor's treasury spokesperson Dean Winter also expressed satisfaction with the decision, describing TasWater's initial proposal as "out of touch" and noting that families were facing significant cost of living pressures.