Corporate greed drives water crisis


NSW Labor Premier Morris Iemma is digging in on the proposed desalination plant at Kurnell in NSW. Despite continuing public opposition, Iemma seems determined to go ahead with this expensive, electricity-guzzling project.

The government's argument is that it is being judicious and careful, and not about to take risks. "This is a metropolis with over 4 million people… We will do what we have to to secure the water supply", NSW planning minister Frank Sartor told ABC TV's Lateline program two years ago.

The desalination plant, with a capacity of 125 megalitres per day, will cost the government up to $1.9 billion. The first consortium vying for the contract is Blue Water (consisting of Veolia, John Holland, SKM, and Mauncell), which built a desalination plant on the Gold Coast.

The second is DMT (made up of Degremont, Multiplex Engineering and Thiess), which built the Perth desalination plant.

NSW Greens MP Lee Rhiannon, a desalination opponent, said John Holland, Sinclair Knight Merz, Multiplex and Thiess had made donations to the ALP of more than $1 million over the past eight years. "The desalination plant was already on the nose but the premier's invite to top ALP donors to tender has just added to the stink", Rhiannon said on February 6.

Another vocal critic of the proposed plant, Charles Essery, is a former NSW government adviser on sewerage and water policy. He was also a senior executive officer for Sydney Water, but is now an independent water consultant and is an adjunct professor at the University of Western Sydney.

Essery doesn't agree that so much money should be spent on a plant that will only produce around 10-15% of Sydney's drinking water (or about 125 million litres per day).

"We've got plenty of water", Essery told Lateline on May 23, 2005. "There is no shortage of water along the east coast. There's certainly no shortage of water in Sydney, but we just don't recycle it. Water is recyclable. It is the only natural resource we use that can be used time and time again. But we're not doing anything with that in Sydney."

Sydney Water Corporation supplies water to the Sydney metropolitan area, the Blue mountains and the Illawarra. The largest individual users of the Sydney Water supply are big manufacturing companies such as Alcoa, Arnotts, BHP-owned Bluescope Steel, Boral Limited, Cadbury Schweppes, Coca-Cola Amatil, Inghams Enterprises, Shell and Visy.

The August 2, 2004, Sydney Morning Herald editorial noted that these manufacturing companies were using "50,000 megalitres of drinking water a year. Massive wastage is built into Sydney's water and sewage system. High quality drinking water is pumped into the city; contaminated, or grey, water is pumped out, in a hugely inefficient, long-distance exchange. The conversion of suitable industries to grey water inputs, for example, could sharply decrease demand for drinking-quality water, as would recycling of grey water and storm water, either on site or city-wide."

While metered residences have their bills for water usage increased by 25% on every kilolitre they use over 100kL, commercial and industrial water users pay the standard water-usage charge regardless of how much water they use.

On January 31, Total Environment Centre director Jeff Angel, noted that inaction by the NSW Labor government has led to the failure of a key program to reduce water consumption by the biggest commercial and industrial water users in Sydney.

Under the Water Savings Order 2005, announced as part of the government's Metropolitan Water Plan, businesses with a site using more than 50 million litres of water a year were required to prepare water savings action plans by last March 31 for submission and approval by the government.

Angel noted that only 40 of the 320 required plans have been approved. Of those approved, only seven are for businesses, 13 are for local councils, while not a single water savings plan has been approved for any state government agency.

"The government is charging headlong toward building a desalination plant while showing no real commitment to curbing its own water use or promoting water conservation amongst Sydney's biggest water users", said Angel. "The failure to ensure implementation of water savings action plans is a damning indictment of the NSW government's management of Sydney's water supply."

When the desalination plant was first proposed in 2005, it fuelled the debate over the nature of public-private "partnerships" (PPPs). A series of contentious and costly tollways, which guaranteed enormous profits to private contractors and forced motorists to pay for the privilege, had proven very unpopular. Here was another PPP — in the form of a desalination plant — being pushed on NSW.

NSW utilities minister Carl Scully, who has since left parliament, tried, unsuccessfully, to appease growing concern by announcing that while the private sector would design, build and operate the plant, the public would pay for its construction.

Following the initial outcry, the government said that the desalination plant would only be used when the main dam — at Warragamba — reached 30% of capacity, Sydney Water's crisis point.

This would have already happened if the Sydney Catchment Authority hadn't changed the way it measures supply. In April 2006, it changed the storage level overnight by 6%, by including the "dead-zone" water at the bottom of Warragamba Dam. According to Essery, "that 5.4 percentage point gap equals about 10 weeks of water consumption and just enough to make the desalination plant trigger occur soon after the state election".

The government is in the middle of an election campaign in which water resources and supply have become key issues. Peter Debnam, the opportunistic Liberal Party leader, initially supported the desalination plant, but has now changed his tune. He has now also changed his mind about drinking recycled waste water — not so long ago describing the "yuk" factor as too great to overcome. He now wants NSW to follow in Queensland's footsteps and establish plants to recycle sewerage.

Warragamba Dam, which flows from a 9000-square-kilometre catchment area, also contains effluent, which is cleaned before it is used. According to Essery, the dam is a mixture of rainwaters, flows which include the waste of millions of animals, and the inflows of stormwater and wastewater from Lithgow, Goulburn an other towns and villages and farms which flow into the catchment area. A huge filtration plant at Prospect makes this mix portable.

Essery believes that if Debnam is elected, he will have the Kurnell plant built. In a comment piece in the January 22 SMH, Essery argued that despite Debnam's resistance to desalination, he might "be faced with a legally binding contract to build the plant".

Meanwhile, the NSW government is spending public money on election campaign ads to soften up the opposition over the desalination plant. One features actor Jack Thompson claiming that the desalination technology will use "green" energy and argues that the Iemma government is taking the only responsible road.

But just how much greenhouse gas will be produced by the proposed plant, and how "clean" the energy used to construct it and maintain it, remains contentious.

A July 2005 paper by the progressive think-tank, the Australia Institute, estimated that the plant could produce emissions equal to 220,000 extra cars on Sydney's roads.

As most electricity in NSW is generated by coal-fired power stations, it can hardly be described as "clean" or "green". The AI paper also warned that "the constant use of energy to run the plant will increase the demand on base-load power stations, and will result in the burning of more coal than would otherwise be the case".

It continued: "Contrary to the suggestions from Sydney Water, the NSW Greenhouse Gas Abatement Scheme will make no difference to the state's greenhouse gas emissions if the desalination plant is built."

The AI paper also explains that the scheme operates through the creation and surrender of accounting instruments called NSW greenhouse abatement certificates (NGACs). These can be created from a range of "greenhouse reduction" measures including renewable energy generation, energy efficiency and planting trees (carbon sequestration). But NGACs can also be created by the most polluting power stations in Australia — such as the brown coal stations in Victoria.

The Nature Conservation Council in NSW argues that any increase in greenhouse gas emissions would ultimately make Sydney's water crisis worse because it would execerbate global warming, leading to more extreme weather conditions and extended drought periods.

[Pip Hinman is the Socialist Alliance candidate for seat of Marrickville in the March 24 NSW elections.]