3 Waters infrastructure planning

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THE LATEST ITERATION of the New Zealand 30 Year Infrastructure Plan was launched late August to much acclaim in Christchurch. Most of the credit must go to the National Infrastructure Unit of Treasury for getting it over the line in such a timely manner – but what does it portend for waters infrastructure?

John Pfahlert, Chief Executive, Water New Zealand
John Pfahlert, Chief Executive, Water New Zealand

The urban water infrastructure of New Zealand has an estimated value of around $45 billion. Over the next decade there are 1167 projects over $1 million in value planned worth $15 billion.

The 3 Waters survey by Local Government New Zealand (LGNZ) in 2014 highlighted a range of deficiencies in the state of information about existing assets, and an uncertain future as to how councils would fund asset replacement in the years ahead. With nearly half the District Councils in New Zealand experiencing declining populations, and with most residents on static incomes, Treasury has expressed concern it may be seen as the funder of last resort for infrastructure replacements and maintenance.

Over the past decade Water New Zealand has championed amalgamation of local councils and the adoption of corporate models of water governance as two means of improving service delivery for 3 Waters infrastructure. Although that hasn’t been a particularly successful strategy, the current work by Waikato Councils investigating a Council Controlled Organisation (CCO) for 3 Waters delivery is encouraging and supported by Water New Zealand. The infrastructure strategy lends support to this approach – noting that if it’s successful the councils will be able to share their expertise with others.

It’s unfortunate that more councils haven’t seen the benefits of these two approaches, but local politics and resistance to the CCO model because it is seen as the first step to privatisation of assets appears to be a concern of local communities.

The infrastructure plan has responded to government concern about poor information on 3 Waters assets by funding a project to develop metadata standards for pipeline assets. This will be led by Land Information New Zealand and is due to be completed by mid-2016. Water New Zealand, LGNZ and the IPWEA are all represented on the governance group, along with representatives from the main councils.

I don’t see the development of data standards being at all difficult. Land Transport New Zealand and councils have been developing similar standards for road assets over the past couple of years without too much trouble. In water the challenge may be getting councils to use these standards. I’d like to see regulations under the Local Government Act to make their use compulsory – but we will probably have to explore voluntary uptake first.

Another of the initiatives being required of councils is the implementation of new planning and reporting requirements in the 2015 Long Term Plans under the Local Government Act. These will include non-financial performance, asset value and asset management, as well as strategies to support planning and dialogue with communities over future levels of service.

You can read into the words “levels of service” an implication that if councils can’t afford to replace assets then perhaps some communities will have water and wastewater services removed. I’d say good luck with that approach! How likely is it that a council would be able to turn off reticulated drinking water supplies?

It does however signal the hard choices that some communities have ahead of them. Anecdotally it seems as if councils are struggling with how to address these issues, which is not surprising given the three-year electoral cycle within local government.

Another project signalled in the infrastructure plan – albeit in code – is the development of a more consistent methodology for determining both urban and rural runoff.

Rainfall, runoff, river channel flows, flood protection and related infrastructure are strongly correlated contributing to a wide range of outcomes including productive water requirements, urban water requirements and natural hazard risk management.

The opportunities and threats are substantial. Concerns have been expressed across a broad spectrum from governance, to technical assumptions and community preparedness. The intent is to develop from previous work by central and local government, Crown Research Institutes and the private sector to establish a programme of activities to prioritise endeavours and coordinate across stakeholders.

Water New Zealand is keen for there to be developed a national approach to the way runoff is calculated in urban and rural settings. Underestimate runoff and pipelines are too small or flood banks too low. Flood damage is the result with insurance claims and damage to community assets. Overestimate runoff and we install pipes that are too large and build stop banks too high. Ratepayers end up paying unnecessarily for over-engineered infrastructure.

Why is national guidance in this area important? Well, in risk terms, flooding is New Zealand’s most significant natural hazard, yet there has been no integrated policy guidance for managing flood risks at the local level since the work started by the now disbanded Water and Soil Directorate in 1988.

Since that time councils have, with varying success, had to develop flood risk planning separately in the absence of any national standards. The cost of flooding was reported to be an average of $17 million per year between 1976 and 2003. Since then the annual insurance cost has averaged >$75 million which is estimated at about 40 percent of the total cost (ie, total flood-related costs reported to be averaged at $190 million/year). These cost patterns align with climate change predictions for an increase in the frequency of extreme weather events and ever-increasing land use modifications.

So, this national waters infrastructure plan is important because it identifies where collective action on a range of fronts will improve the effectiveness and performance of water management across New Zealand.

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