Community wastewater management system FAQs

Published on 05 July 2019

Several areas within the City of Onkaparinga do not have access to SA Water’s wastewater network.

For this reason, the council owns and operates a community wastewater management system (CWMS),
to collect, treat and reuse or dispose of wastewater in these areas.

Which areas are served by the CWMS?

The council’s CWMS includes seven wastewater networks in Clarendon, Morphett Vale, McLaren Flat, McLaren Vale, Willunga, Maslin Beach, and Sellicks Beach.

The service provided to all 4500 CWMS customers is the same, with the exception of customers in Ocean View Estate in Sellicks Beach. The properties in Ocean View do not need septic tanks for the primary treatment of their wastewater, because primary treatment occurs at the Sellicks Beach Wastewater Treatment Plant.

For all other areas, septic tanks are pumped out (or ‘de-sludged’) by council on a four-year cycle.

The CWMS relies on two wastewater treatment plants. These facilities treat the wastewater and it’s then provided to the Willunga Basin Water Company for reuse in the region.

Three of the networks — Clarendon, Morphett Vale and Maslin Beach — require disposal of untreated effluent directly to SA Water’s sewer system, and council is charged ongoing fees by SA Water for this service.

Why are septic tanks pumped out (de-sludged) by Council on a four-year cycle?

All of council’s CWMS networks are septic tank effluent drainage systems (STEDS), with the exception

of the Ocean View Estate in Sellicks Beach as described above.

STEDS networks require that all connected properties have their own on-site septic tank for the primary treatment of their domestic wastewater. 

Primary treatment ensures that solids, fats and oils are settled and digested within the septic tank and are not transferred into council’s CWMS.

Domestic wastewater that has undergone primary treatment through a septic tank is referred to as ‘effluent’.

STEDS networks are not designed to receive domestic wastewater without having undergone appropriate primary treatment through a septic tank. Customer septic tanks are pumped out (de-sludged) by council’s contractor on a four yearly basis – which aligns with the requirements of SA Health’s On-site Wastewater Systems Code.

What is involved in operating and maintaining the CWMS?

Operating the CWMS involves a lot more than simply pumping out septic tanks.

Septic tanks are only one part of the entire system, which also includes 145km of sewer pipelines, 16 wastewater pump stations, and two Wastewater Treatment Plants. Maintaining this $37 million system involves ongoing capital upgrades, preventive maintenance works, 24-7 emergency response, and day-to-day operational matters, including:

  • specialist engineering (e.g. hydraulics)
  • development control
  • water systems design
  • regulatory compliance
  • risk management
  • public and environmental safety
  • service continuity
  • work, health and safety matters.

What does it cost council to maintain and operate the CWMS?

In 2018–19 it cost the council a total of $3,011,652 to maintain and operate the CWMS.

Because the networks are in different locations they require different infrastructure, which varies in age and condition. This means the cost to manage each network also varies, but generally those costs include the following:

  • Operations and maintenance contract with a qualified operator (TRILITY Onkaparinga Pty Ltd)
  • Salaries
  • Capital works
  • Emergency response
  • Electricity
  • ESCOSA licence fees
  • Septic tank desludging program
  • Finance costs
  • Depreciation
  • Administration and reporting
  • Insurance.

Council is also charged for disposing wastewater collected from CWMS customers into SA Water’s sewer system. Council is currently negotiating with SA Water to establish a long term agreement for the discharge of effluent from the Clarendon, Morphett Vale and Maslin Beach CWMS networks into their sewerage network.

How is CWMS customer pricing determined?

Under the provisions of the Water Industry Act 2012, the Essential Services Commission of South Australia (ESCOSA) is responsible for the economic regulation of sewerage services (including CWMS). 

ESCOSA requires water retailers, in this case the City of Onkaparinga, to comply with established National Water Initiative Pricing Principles. 

These principles are based on a full cost recovery framework which includes a return on asset (ROA) component, and allowance for risk component. 

Application of these principles for 2018–19 CWMS customer pricing resulted in an increase to the annual CWMS service charge for all CWMS customers.

Because of the significant impact that full cost recovery pricing will have on our communities, we have negotiated a five year transition to full cost recovery with ESCOSA.

Remember the requirement for council to operate the CWMS on a full cost recovery basis is set by ESCOSA, not by council.

The five-year transition to full cost recovery pricing is based on a gradual ramping up of the ROA and risk component of the annual charge to customers, and council has decided to provide a rebate to CWMS customers for the first two years of the transition period.The costs over the last two years, with the council rebate applied, are:

 

2017-18

 

2018-19

 

2019-20

Gross charge

$781

Gross charge

$851

Gross charge

$985

Council rebate to customers

$111

Council rebate to customers

$119

Council rebate to customers

$193

Net charge

$670

Net Charge

$732

Net Charge

$792

 

ESCOSA confirmed in August 2018 that council’s pricing policy is fully compliant with the National Water Initiative Pricing Principles and therefore is also compliant with the commission’s price determination and the requirements to operate on a full cost recovery basis. To ensure equity and fairness, each customer in our CWMS scheme pays the same annual service charge, whether the actual cost to provide the service to a specific customer is higher (or lower) than the average.

This approach is called ‘pricing commonality’, or is sometimes referred to as ‘postage stamp pricing’, because the price is the same for everyone.

ESCOSA permits the use of pricing commonality for CWMS pricing in South Australia. Again, ESCOSA confirmed in August 2018 that council’s adoption of this approach is compliant with the National Water Initiative Pricing Principles.

What about claims made that Clarendon’s Community Wastewater Management Scheme (CWMS) charges were “excessively high”?

Councillor Martin Bray submitted a report to Council in 2018 which claimed that customer pricing for the
City of Onkaparinga’s Clarendon Community Wastewater Management Scheme was “excessively high”.

Cr Bray shared that report with the Essential Services Commission of SA (ESCOSA) and asked them to investigate the claim.

ESCOSA is the financial regulatory body that governs council’s license for the CWMS.

What did ESCOSA find?

In August 2018, ESCOSA found the council’s operating revenue, per-customer costs and annual CWMS charges were NOT excessively high when assessed against other comparable councils.

ESCOSA also found that the Council is satisfying the National Water Initiative Pricing Principle, allowing retailers to average charges across multiple networks and impose a uniform charge for all CWMS users.

This is known as postage stamp pricing – one price for all customers.

Council does this because all CWMS customers are considered to benefit from increased numbers of households accessing the CWMS and therefore contribute equally to scheme’s ongoing operation.

All four other councils which ESCOSA benchmarked the City of Onkaparinga against - Adelaide Hills, Berri Barmera, Mt Barker and Barossa - also currently implement a postage stamp pricing approach for their respective CWMS schemes.

A copy of ESCOSA’s findings can be downloaded here .

Does council expect that customer pricing might fall in future?

In the longer term, there could be a price drop but this relies on changes to many factors such as input costs, asset renewal cycles and contractor costs.

Part of council’s contract with TRILITY Onkaparinga Pty Ltd (TRILITY) saw them invest in the construction
of CWMS infrastructure and our contract payments to TRILITY include a recoupment over time for that investment.

At the end of the contract, once TRILITY has been repaid for the investment they made in the infrastructure, part of the ongoing costs of running the system is likely to be lower and this will have a positive impact on pricing.

Before then however, council is bound by ESCOSA’s requirement to operate on full cost recovery pricing, which has increased customer pricing.

Since the council adopted ESCOSA’s full cost recovery pricing determination, council has applied a rebate
to reduce the financial impact of this transition on customers.

I’ve heard council might look at selling the CWMS. Is that true?

Council is currently considering future management options for its CWMS but no decisions have been made at this time and there is a detailed process to go through.

One option would be to sell the CWMS to a specialist water company.

A specialist company would have the expertise to continue operating these assets efficiently, commit further resources to important investments, and provide a better level of service to customers, while providing a financial return to council that could be used for other priorities across the region.

Council called for expressions of interest from specialist water companies in early 2018 and it was clear there was market interest in the CWMS.

On 11 September 2018, Council resolved to go to tender for the purchase of the CWMS and this tender is being prepared, but a release date has not yet been set.

Following the completion of the tender, elected members will consider the available options and decide on
a future management path for the CWMS.

Again, no decision to sell the CWMS has been made at this point in time.   

If you have any further questions please send an email to mail@onkaparinga.sa.gov.au with the subject heading CWMS.