The Huia Watercare plant in Titirangi. Photo / Peter Meecham
The Huia Watercare plant in Titirangi. Photo / Peter Meecham
The cost of replacing the Huia water treatment plant has increased from $420 million to $1.12 billion.
Watercare chief executive Dave Chambers says the new cost is realistic, citing extensive work and challenges.
The Commerce Commission will monitor Watercare’s finances, aiming for greater transparency and accountability.
The cost of replacing the Huia water treatment plant in Auckland’s Waitākere Ranges has blown out from $420 million in 2018 to $1.12 billion.
The billion-dollar project has come to the attention of the Commerce Commission and news of the cost blowout follows a directive fromAuckland Mayor Wayne Brown last week for capital projects to face greater scrutiny in planning and execution, and 10 steps to deliver projects affordably.
Today, Brown was relaxed about the project cost, saying improvements had been planned for several years and the overall project will build water supply resilience across the north and west network.
“I expect Watercare has carefully considered its projects and will work to ensure the investment provides good value for what they’re spending. We have seen in Wellington what happens when there is under-investment in water infrastructure. We don’t want to see that happen in Auckland,” Brown said.
Watercare chief executive Dave Chambers has defended the latest cost, saying it is realistic and “represents good value for Aucklanders”.
Since the initial cost estimate, extensive work has been carried out to fully understand the requirements for replacing the century-old plant, increasing its capacity, and building two new reservoirs and two new water mains, he said.
“During this time, Auckland has faced not only a global pandemic and high inflation but also local challenges such as extreme drought and flooding.
The Lower Huia Reservoir in the Waitākere Ranges during the 2020 drought. Photo / Brett Phibbs
“This new infrastructure needs to be resilient and built to withstand severe weather events.”.
The latest cost for the water plant is contained in Watercare’s 10-year business plan, released today, as it prepares to become financially independent of Auckland Council on July 1.
The plan details how the council-owned water business will invest $13.8b in more than 1000 projects after an agreement was struck in May last year between Auckland Council and the Government for Watercare to come off the council’s books.
This has avoided a 25.8% water bill rise for households. From July, the increase will be 7.2%.
As work nears the end on the $1.67b central interceptor - a super-sized wastewater tunnel 16km under Auckland between Herne Bay and the Māngere wastewater treatment plant - Watercare has about 16 major projects, including a $1.1b upgrade of the Māngere plant and the $1.1b upgrade at Huia.
Chambers said Huia is a “mega programme of works” for a new plant, pipes and reservoirs linking to a planned $785m water main between the Huia plant at Titirangi to Albany on the North Shore to support population growth.
“The plant will meet approximately 20% of the region’s water needs, making it critical infrastructure for the community.”
Watercare chief executive Dave Chambers.
Chambers said when it rains heavily in the Waitākere Ranges, the small dams fill with silt, which the old plant cannot treat.
“When we have the most water to turn into drinking water, that’s when we can do the least, and our capacity drops by about 40%. With a new plant, we will be able to do more and able to treat poor-quality water when it rains heavily.”
Huia was chosen as the site for a new water treatment plant after Watercare got burned in 2017 with a proposal to take up to 18 homes and rural properties at Ōrātia, but encountered strong opposition.
Construction at Huia is expected to start in 2028 and be completed in 2033. In 2017, Watercare said it expected to have the project finished by 2023.
Dam technician Chris Oord, in a raw watermain tunnel in the Waitākere Ranges.
One insider told the Herald that Watercare had lost a lot of experienced staff. They believed that planning and design was inefficient.
The person said material costs have risen but that did not account for the Huia project cost nearly tripling.
“Something is not right,” the insider said.
Last December, the Government appointed the Commerce Commission as a Crown observer to monitor Watercare’s finances and other performance measures under a charter until 2028.
Commission chairman Dr John Small said Aucklanders can expect greater transparency and accountability from Watercare, including quarterly reports on capital projects.
Commerce Commission chairman Dr John Small is aware of concerns about the cost of Watercare projects. Photo / Mark Mitchell
“We expect this to include the programme of work for the Huia water treatment plant.”
Small said the commission has been aware of concerns around the cost of other Watercare projects and worked with staff to improve their skills in the lead-up to its monitoring role starting on April 1 next week.
“Once our powers take effect, we will also use formal tools within the Charter to drive improvements,” he said.
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