GMID Price Path - Shepparton

GMID Price Path - Shepparton

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Our transformation project is a vital part of our Price Submission and it is important our prices reflect a transformed GMW.

This is why we’re working with you - our customers – to put forward our proposed fees and charges in our Price Submission to the independent umpire – the Essential Services Commission (ESC).

In this Price Submission we will set out the efficient costs of delivering our services for the period 2020 – 2024. Upon review and approval from the ESC, these costs form the basis for the fees and charges that we then recover from you.

Transformation

GMW is transforming our business. We need to change to match the rapidly changing characteristics of the GMID footprint, and the new reality of external factors such as climate change and competition for water resource.

Important elements of transformation include creating efficiencies in business operations and asset management practices to meet our short, medium and long term financial challenges.

Our financial challenge is summarised by delivering cost reductions to deliver sustainable price outcomes for customers, while achieving a sustainable debt position in the future.

Transformation will help ensure that the costs of the services we provide to maintain our assets (thing like dams, channels and meters) along with the operational cost of running the business are efficient for you!

Our transformation project is a vital part of our Price Submission and it is important our prices reflect a transformed GMW, now and into the future.

What we are hearing?

We’re hearing you want to better understand our prices, so you’re sure they’re fair and sustainable. We also understand you’re looking for price relief as you are challenged with increasing volatility through market forces, climate and water availability.

In your words

  • “The biggest issue is drought and high water prices”
  • “Supply water @ decent price.”
  • “Reduce cost to make water economic to use.”
  • “Drop the Price of Water for the next three years. Also charge non-landholders that own water the same as irrigators who own land.”
  • “Be more transparent with costs.”
  •  “Spread of costs across storage and delivery as the biggest costs are delivery. Investigate pricing structure options to help sustain our delivery system here.”  

What can we do?

We know cost is a major concern for everyone. We want to work with you to understand your priorities to help determine our regulatory strategy for the next four years. There are certain regulations we must adhere to, and we need to be mindful of these to ensure the revenue we receive is aligned to our costs over the regulatory period.

Price Path

Based on GMW’s transformation outcomes, we have prepared our draft operating expenditure, capital expenditure and demand forecasts. This then informs our projected prices for the next regulatory period.

Questions for you

  • How can we best reflect what is important to you in our Price Submission?
  • How can we best allocate risk between customers and ourselves from planned cost reductions over the next four years?
  • What is the price paths that best meets your needs – noting each option recovers the same amount of revenue over the four year regulatory period?

Draft Price Path

Table 1. Each price path option proposed a decrease in prices from what customers will pay in 2019/20.

Table 2. Draft price path option 1 explained as a bill impact on typical customers.

Table 3. Draft price path options impact on Infrastructure Access Fee (IAF)