Dr WOODRUFF - Thank you. TasWater's annual report includes a line item for revenue from irrigation income. On page 77 in the financial 2020-21 year the figure is $963 000. I assume this relates to potable services; if you could clarify that. Can you tell me which irrigation schemes are receiving potable water services from TasWater?
Mr BREWSTER - From recollection, the South East Irrigation Scheme stage 2 and 3. You might recall other schemes that receive potable water. Some smaller customers pay for potable water for irrigation purposes, because that works for them and we provide it, but it is not core business for us. We would not have thought it was economical for most people, but for some people that is what they want and that is their choice.
Dr WOODRUFF - The South East Irrigation Scheme sources its water, I think, from the Bryn Estyn treatment plant and draws something like 8.22 megalitres a day. That has been controversial in previous summer months with water restrictions that apply to Hobart, and that may be the situation this coming summer. Does TasWater make a profit from irrigators while it is placing water restrictions on the same distribution network?
Mr BREWSTER - In terms of whether we make a profit or not, we put in a submission. That submission to the regulator determines our returns. It provides a return on assets, and a return of assets. All of that is used to calculate a revenue charge that is deemed to be fair and equitable for everybody. To the extent that what we charge them contributes to that return on assets, then yes, I guess there would be a profit. When we do that, we build the whole price up for the regulator, and then we break it back down. We don't say, this week we think we can make 10 per cent more out of Tasmanian Irrigation because they are a bit short on water. Our prices are set and we stick to them.
Dr WOODRUFF - Dr Gumley, at the last Estimates table we had a conversation about the South East Irrigation Scheme. You said:
I think the long-term answer has to be that the irrigators take their water from the Derwent that is not treated and that a pipeline should be constructed for that purpose.
Have discussions taken place between Tas Irrigation and TasWater?
Ms WHITE - You should have been at yesterday's Estimates hearing because we talked about this for an hour.
Dr WOODRUFF - I'm talking to TasWater now.
Dr GUMLEY - The broad statement is true. It's quite silly using treated drinking water for irrigation.
Mr WINTER - It's completely consistent with what the CEO said 10 minutes ago as well.
Dr GUMLEY - Yes.
Dr WOODRUFF - Have you had formal conversations about disconnecting Tas Irrigation from Hobart's drinking water supply? That was the question?
Mr BREWSTER - Yes, but not like that. We have been working closely with Tas Irrigation, as I said earlier, on how we get them off the scheme. That's been ongoing for longer than 12 months. We've been seriously looking at options over the last 12 to 18 months. Yes, absolutely, we have been working closely with Tas Irrigation. They've got their challenges trying to find solutions and we're trying to accommodate that.
To say we would just disconnect them, we wouldn't do that. We would work through: how do we help you get off as quickly as possible? That's what we're trying to do. So, we're not going to have a hard disconnect and say you're gone. We're not going to do that. That would not make sense.
Dr WOODRUFF - It wasn't what I was -
Mr BREWSTER - Okay.
Dr WOODRUFF - No, towards the ultimate end, whenever that does happen, if there was the alternative pipeline that's what it would result in. Does the 25 year agreement have a possibility of being ended if those consultations are concluded?
Mr BREWSTER - Any legal agreement can be ended by joint agreement of the parties. Our parties have agreed that that will need to end. Now we're just working our way through that process. Obviously, we've got to keep the irrigators supplied as much as we can, so we're working with them.
We understand with engineering projects, as you talked about, you've got to make sure before you commit that you understand the true costs and time frames. As long as we see - and we do see - that they're working really diligently on that, we're happy to work really closely with them to get an outcome that's better for everyone.