HOLDING DENIES DESAL PLANT WILL HIT $15.8BN

September 17, 2010 - 11:47AM

The Brumby government has disputed an exclusive report in today's Age that the true cost of the Wonthaggi desalination plant is $15.8 billion over the next 28 years.

Water Minister Tim Holding said the government had been open about the fact the construction and operation of the plant would be $5.72 billion.

"The reports in today's Age do not accurately describe the water security payment," he told reporters today.

"We have been upfront about the cost of the desalination plant over its full life and we've been upfront with Victorians about why the desalination plant is so important."

Mr Holding said the cost of the plant over the life of the contract in "today's dollars" was $5.72 billion, and that was based on the assumption the government chose to order the maximum 150 billion litres of water every year.

"I suspect we will definitely be ordering water when the plant comes on-stream at the end of 2011 unless we have rains of, frankly, biblical proportions, we will be ordering from the plant into the forseeable future," he said.

The Age reported that the highly sensitive figure is contained in a Department of Sustainability and Environment (DSE) report - one of hundreds tabled in Parliament this week.

The report said taxpayers would fund the Aquasure Consortium to the tune of at least $15.8 billion to run and maintain the Wonthaggi desal plant, the largest in the southern hemisphere.

The news comes at a bad time for the state government in the lead-up to the November 27 state election, with the cost of water infrastructure projects under the microscope and following a wet winter in which the state's reservoirs rose to more than 45 per cent full.

AAP

This story was found at: http://www.theage.com.au/victoria/holding-denies-desal-plant-will-hit-158bn-20100917-15fcp.html