Executive Directors Report February 13 2012 WSAA Executive Director Adam Lovell

1. Executive Directors ReportFebruary 13 2012WSAA Executive Director Adam Lovell • The Water Services Association of Australia is the industry body that supports the Australian Urban Water Industry

2. WSAA DRAFT BUSINESS PLAN 2012 – 13 Focus on rolling out the WSAA strategy • Expected outcomes • New governance structures, format for network meetings and planning processes that support delivery of strategic initiatives • The establishment of Water Skills Australia to address skills development for the industry • A revised NWI – in conjunction with stakeholders • Established, clearly communicated policy positions • 5 year research roadmap for the urban water industry supported by a strategy for advocacy and delivery • Improved member services • Targeted, improved stakeholder communication • A break-even or slightly surplus budget

3. THE NEW WSAA GOVERNANCE STRUCTURE Board Executive Director Healthy Liveable Communities Committee (Chair: John Ringham) Asset Management Committee (Chair: Kevin Hutchings) Customers and Industry Policy Committee (Chair: Shaun Cox) Safety and Wellbeing Network (Chair: Kevin Young) Networks Source Management Civil assets Mech/Elec and SCADA Codes Metering Intelligent Water Networks Safety and Wellbeing Disaster Recovery (WSIAAG) Networks Drinking Water Water Recycling GHG and Energy Environment Water Conservation Networks Chief Financial Officer Economic Regulation HR Managers Customer Services (proposed) Communication Managers Network Collaboration Committee (to be formed later in 2012) Responsible for: • Delivery of cross-committee initiatives • Oversight of the national and international R&D investment • Oversight of the implementation of the Research and Innovation strategy • Oversight of TAG Research Managers Network

4. NATIONAL POLICY INITIATIVES • NWC Review completed and awaiting Cabinet approval • WSAA (as agreed by NWC) will revise the urban water scope of the NWI • DCCEE has released a report “Role of Regulation in facilitating or constraining adaptation to climate change for Australian infrastructure” • Focus on 6 areas of regulation • Licensing to protect infrastructure • water restrictions • sustainable water strategies • urban-rural water trading • water sensitive urban design • third party access regimes

5. NATIONAL URBAN WATER POLICY AGENDA • Project developed following urban water policy reviews from NWC, PC and IA • Project objectives • determine the features and objectives of a successful urban water sector • identify the pathway/s to achieving this • develop a white paper which proposes an update to the national urban water policy agenda

6. NATIONAL URBAN WATER POLICY AGENDA • In principle support from NWC and DSEWPaC • Project will include engagement of WSAA member utilities and other stakeholders (federal, state , local governments, regulators, customer representatives, environment representatives) • Delivery of final draft of white paper in time for Ozwater’12

7. WATER INDUSTRY WORKFORCE DEVELOPMENT • Update • Development of the Job Classification and Competency Framework • Representation to the ABS for recognition of Water Industry ANZSCO Codes • Formation of the WSAA HR Managers Network • Round 2 Consultation Workshops for the Certification of Water Treatment Plant Operators

8. SHAUN COX Melbourne Water

9. Productivity Commission Climate Change Adaptation Inquiry • “Barriers to effective climate change adaption”Inquiry into the regulation and policy settings to enable effective climate change adaptation. • Issues paper released 31 October 2011 • WSAA Key Messages • WSAA agrees with proposed barriers. Proposed additional category to address legacy issues • WSAA believes in a risk management approach to adaptation planning • Implementing responses to climate change will require collaboration of water utilities with regulators and policy makers • The draft and final reports will be released in May and September respectively

10. DRAFT ENERGY WHITE PAPER 2011 • Submissions due March 16. Final paper released mid 2012 • Long-term energy policy framework to guide development of Australia’s energy systems • Paper recognises issues such as climate change, water policy and environment frameworks • Water industry submission on behalf of WSAA members • To state importance of interrelationships such as water energy nexus • Opportunity to remind government how much energy policy impacts on the Australian urban water industry

11. CARBON AND ENERGY POLICY UPDATE • PC Climate Change Adaptation Inquiry • Draft Energy White Paper • 2012 Conferences • WSAA Report Releases • Electricity & Carbon Forecasting Project – Round 2 completion

12. ELECTRICITY AND CARBON COST FORECASTING • WSAA members jointly engage SKM.MMA to price for a 20 year period using Australia Federal government prices for • Electricity • Networks charges • Renewable Energy Certificates (RECs) • Carbon Price • Benefits • Cost savings to individual businesses • Consistent price forecasting across the water industry • May mean water authorities are able to get price forecasts more often providing more up to date and better business decision making

13. ADAPTWATER • Update continued • Module 1 Sydney Water prototype (desktop model) complete • Prototype simultaneously manages impacts of extreme events (flooding) and incremental losses (sea level rise) on sewerage assets. • Demonstrates ‘asset by asset’ approach = high resolution for location-specific climate change impacts. • Quantifies impacts, enables scenarios and compares the cost effectiveness of adaptation measures

14. ADAPTWATER • Update • Modules 2 and 3 have commenced Prototype to be extended to Melbourne Water and SA Water. • Sydney Water Pilot (extension of water assets and additional climate change impacts) • Modules 4, 5 and 6 – WSAA pilots and full scale rollout to Sydney Water and other WSAA members

15. WSAA REPORT RELEASES • Climate change adaption report • Replacement costs for the Australian water and sewer networks combined could reach $350b. We know from the Queensland floods and Victorian bushfires that climate change will affect our industry. We need to share information, learn from catastrophic events and equip ourselves with robust data and tools to be prepared. • Energy use in the provision and consumption of urban water in Australia: an update • Since the last analysis in 2008, more energy has been used in water supply treatment, principally because of the increase in desalination and water recycling. However, energy for urban water services is still a small fraction of the total energy associated with water use (12%).

16. WSAA REPORT RELEASES • Cost of Carbon Abatement Tool • Wastewater utilities are in the unique position of being both major energy users and potential sources of renewable energy. The CCA tool is a dynamic decision support tool that standardises and simplifies the assessment of carbon abatement opportunities to help realise this potential. • Cities of the Future – OzWater 11 Report • Should the industry view the ‘environment’ and the ‘community’ as a customer?

17. WATER QUALITY ADVISORY COMMITTEE • NHMRC's current Water Quality Advisory Committee (WQAC) is working on several projects in relation to ADWG • Later this year, several proposed updates to ADWG will be released for public comment • These proposed updates will include updated versions of the disinfection information sheets and advice on boil water advisories • The other major project of the current WQAC is to progress the inclusion of health-based targets in ADWG • NHMRC is considering convening a national workshop on the issue of health-based targets in the next couple of months

18. HEALTH BASED TARGETS IN ADWG • WSAA is preparing a water industry submission on Health Based Targets (HBT) for the Health Regulators Forum • The industry supports the µDALY as the most useful, currently available metric for implementing Health Based Targets. However: • how it is introduced and regulated is critical to its success • clear messaging needs to be part of the development of any guideline around Health Based Targets as this metric is difficult to communicate •  the µDALY is a target and should not be seen as a pass/fail metric. Falling short of the target does not mean unsafe, but may trigger a specific risk assessment tailored to the local conditions

19. HEALTH BASED TARGETS IN ADWG • It is expected that the introduction of Health Based Targets should not add a significant regulatory or infrastructure investment impost • However, this is a more conservative measure and may require higher levels of treatment in some situations • There are other considerations in relation to the implementation and validation of the Health Based Targets that will be included in the submission

20. WSAA Update and Member News delivered to 2500 subscribers per month • New branding established • New website to be launched March 2012 • Energetic Communications Managers Group • Stronger presence at Ozwater • New templates for WSAA communications • Research projects – membership and customer • Communications support for projects and initiatives • COMMUNICATIONS UPDATE

21. 2012 CONFERENCES • OzWater 12 – Ecological Footprint • WSAA co presenting with Dr Chris Dey (University of Sydney) • Description of the tool • Overall approach to environmental assessment of water utilities • Benefits to the Australian Urban Water Industry

22. 2012 CONFERENCES • Enviro 2012 – Cost of Carbon Abatement Tool • Abstract submitted - collaboration with Phil Woods (Sydney University) • Description of the tool • Carbon abatement opportunities identified within water industry • Case studies from participating water utilities • Benefits to the Australian Urban Water Industry

23. Almost 800 member employees have access to WERF and WaterRF • Since July 2011, approximately 550 reports have been downloaded from the WERF and WaterRF sites • The Annual WERF Research Forum was held in December 2011, with 35 WSAA members participating • Sessions covered emerging research on Operations & Technology, Asset Management and Novel Technologies, Nutrient Removal and Recovery, and Storm water • WSAA members have participated in numerous US webcasts, with WRRF hosting a couple of webcasts screened specifically for WSAA members • RESEARCH HIGHLIGHTS

24. WSAA has developed an R&D Charter to cover the principles of communication, sharing of research outcomes and potential collaboration between WSAA members and affiliates • The R&D Charter will minimise duplication and document agreement on members sharing research outcomes and collaboration on projects.Paper recognises issues such as climate change, water policy and environment frameworks • Submission on behalf of WSAA members • To state importance of interrelationships such as water energy nexus • Opportunity to remind government how much energy policy impacts on the Australian urban water industry • RESEARCH HIGHLIGHTS

25. US RESEARCH INVESTMENT • WSAA has invested in WaterRF and WERF for the last three years • Investment is successful based on member feedback and continued investment supported • Plan to expand the investment to include the WateReuse Research Foundation (WRRF) • WSAA is assessing the success of the investment against pre-determined KPIs. These include: • member access and use of research outcomes • WSAA influence over the WERF and WaterRF program areas • leverage from our investment • tech transfer of outcomes • WSAA is considering new ways to maximize value and establish its role as part of the new Research and Innovation Strategy.

26. MICHAEL MALOUF Watereuse Australia

27. RESEARCH AND INNOVATION STRATEGY • The strategy will provide a research roadmap and articulate the research needs of the industry and detail WSAA’s role in facilitating delivery of research outcomes and encouraging innovation • Strategy Working Group formed to develop the framework and key priority areas - which are • Customers and stakeholders • Changing world • Sustainable urban communities • Water quality, health and environment • Building capability in our people • The strategy and roadmap will be developed in consultation with the WSAA Committees and members and will be presented to the WSAA Board and at Ozwater in May. Implementation will begin in July 2012

28. Four strategic research priorities (proposed) • safe and healthy water • water security • managing floods • valued water solutions • National Urban Water Science Needs and Capabilities Forum (proposed) • National Urban Water Science Strategy (proposed) • In principle support from CEO, NWC • Needs a champion • Ken Matthews? Geoff Gallop? • Australian Urban Water Research and Development Coalition

29. 2012 ASSET MANAGEMENT PEFORMANCE IMPROVEMENT PROJECT • 42 utilities participating from Canada, United States, China, New Zealand, Philippines and Australia • Key deliverables; industry report, utility report , independently assessed Aquamark assessments, leading practices workshop and accredited participant staff in Aquamark • Aquamark has been comprehensively reviewed and updated and will be used as the key methodology • Key themes are governance and practical application of frameworks, efficiency, project justification and prioritisation and forecasting/ decision making tools Project commenced in early February 2012 and will conclude in December 2012 after leading practices workshops in Sydney and the United States

30. AM PROGRAM ACHIEVEMENTS • Successfully completed and delivered via industry workshop • Blockage Management Manual and Software Tool • Good Practice Guideline on Infiltration and Inflow • Condition Assessment Selection tool • Each deliverable will help our members make informed AM decisions regardless of their position in the AM journey.

31. AM PROGRAM PLANS • AMFORUM12 for full associate WSAA Members and eligible urban water industry professionals. • Funded by the WSAA AM Program • Supported and attended by the WSAA AMC • Designed to take you on a journey through water supply and sewerage AM • Extremely beneficial to new AM practitioners as it will expose them to experienced professionals and provide opportunity for networking, information sharing and fresh ideas.

32. TECHNOLOGY APPROVAL GROUP (TAG) AUSTRALIA • Partnership Agreement between Isle Utilities and WSAA was signed on 22 Dec 2012 • First TAG Australia meeting was held yesterday at WSAA Sydney office • Isle Utilities has visited the majority of the 29 TAG Australia members • WSAA is exploring other services where Isle Utilities may be able to assist; for example, field trials of new technologies or products

33. A shared goal is to achieve a profitable and harmonious relationship between Australia’s urban water utilities, (represented by the WSAA) and Australian companies that supply into the water sector, (represented by “water AUSTRALIA” and the Industry Capability Network). • The objective is to maximise the opportunities for Australian suppliers into the water sector and in turn, to build a capable, disciplined, Australian supply chain to meet the changing needs of the utilities. • AUSTRALIAN WATER SUPPLIER COMPACT

34. The Board approved WSAA entering the Compact subject to adopting a number of principles: • WSAA members will not support any agreements or mechanisms that involve shortcutting full cost and technical evaluation of any products and services, whether Australian made or not • WSAA will bring low hanging fruit to the Compact and set up a portal on the WSAA website for upcoming projects from members • WSAA will seek from the Compact and WaterAUSTRALIA , benefits including an embedded carbon model • The Asset Management Committee will be the procurement group to progress the Compact • AUSTRALIAN WATER SUPPLIER COMPACT

35. SMART WATERMARK • Update • Expert Panel assessed 600 products with 300 approved • Stakeholder Forums in Sydney, Melbourne and Perth • 2011 Product of the Year Awards • 5th Wave of Newspoll national survey of public attitudes to water saving • Ozwater Water Efficiency workshop • Judge for Savewater! Awards • Joined Water Stewardship Australia

36. SMART WATERMARK FUNDING • Utility Support: SA Water, Unitywater and Gladstone Water Board agreed. Positive discussions with number of other utilities • New HAL funded project started identifying water efficiency in the horticulture industry • Bid submitted to 2012-13 HAL fund • Leveraging $80k free advertising on TV, online and in consumer magazine

37. And one last thing

38. THANK YOU Our vision “Valued water solutions for a better future” Our mission “WSAA will advocate, collaborate and innovate to deliver value for its members”