Report 1

Water Corporation: Management of Water Pipes

Auditor General’s Overview

Water is a precious resource, particularly in a state like ours. Traditional sources of supply have become less reliable while demand has grown. Managing and using water in a sustainable way is a shared responsibility and in all of our interests. Doing so will also help keep down the costs of water to both government and consumers.

A key part of meeting that challenge is to ensure that the network of pipes and equipment that transport water from source to consumer are well managed. The water supply network is a critical asset with a replacement value in the region of $11 billion, over a third of the value of the Water Corporation’s total asset base. Overall it has performed relatively well in terms of the incidence of leaks and bursts, and has not required major replacement expenditure to maintain that performance.

The network is ageing, however, and increasing levels of investment will be needed to maintain its performance. Without an effective approach to planning that investment, there is a risk that Water Corporation may either under or over invest, with consequences for both customers and government in terms of levels of service and costs. Water Corporation is implementing a risk based approach to targeting its spending on pipe replacement which should help it avoid under or over investment. This approach relies on having robust and accessible information, and there is room for Water Corporation to improve in that area.

Every water supply network will experience water loss. Internationally accepted benchmarks provide guidance about what minimum levels of water loss are achievable. Current levels of water loss are about 10 billion litres more than the benchmark. This should not diminish the community’s commitment to reducing its water usage, but reinforces the need for Water Corporation to continue and strengthen is efforts to reduce loss and ensure water supply is sustainable into the future.

Page last updated: February 19, 2014

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