The price tag for the desalination plant planned for Wonthaggi has increased from $3.5 billion to $4.8 billion.
On the July 31 ABC Stateline program, Tony Shepherd, then chairperson of AquaSure, the consortium building the plant, said: "I think the total funding will be $4.8 billion, so the difference between the $3.5 and the $4.8 is associated with the financing of the project."
He said the extra was for "things like interest during construction and company costs".
He also said running of the plant would cost "hundreds of millions per year".
Watershed Victoria has been leading the campaign against the plant. The groups said "water from the plant must cost at least five times what we get from Melbourne water now."
Watershed president Stephen Cannon told Green Left Weekly: "When the contract was awarded, it was given as $3.5 billion … Now we hear $4.8 billion. We don't see how it could be $1.3 billion in interest over a couple of years."
Cannon said the government has not released details of the contract two months after signing it, despite assurances that it would be made public.
Watershed has compared the plant's projected energy use with current Melbourne Water energy use. It says desalination will use 18 times more than the energy currently used to source Melbourne's water, or 2.6 times all the current energy use for Melbourne Water including sewerage (which is 76% of the current total).
The group met with representatives from the National Australia Bank and Westpac, the financiers of the project. Both banks are signatories to the Equator Principles, an international set of environmental and social guidelines for finance projects, which Cannon said the banks appeared to be violating.
Watershed had hoped for the banks to respond to its questions by November 6, but Cannon said they'd heard nothing by that date. If a response is not received soon the campaigners will consider other actions.
Melbourne's water storage remains low at just over 38% of capacity, but this is higher than at the same time last year (33.7%). Melbourne's water use has remained almost below the voluntary target of (average) 155 litres per person per day since March, despite first six months of the year being the driest on record.