focussed on sustainability AnnuAl RepoRt 2010 / 11 Water Consumption & environmental governanCe & YeAR in Review soCial sustainability 2i Drought response sustainability organisational struCture 2010/11 t R EPO l R A nnu A LANCEFIELD Shire of Mitchell Lancefield Reservoir Garden Hut Reservoir Deep Western Water Western Shire of Macedon Ranges River ROMSEY Creek Campaspe WOODEND Reservoir Romsey Reservoir Shire of Hepburn MT MACEDON MACEDON Riddells RIDDELLS CREEK Campaspe NEW GISBORNE Rosslynne Creek Reservoir Jacksons Jacksons Creek Creek GISBORNE City of Hume Lerderderg SUNBURY Creek Deep Creek Shire of Moorabool COIMADAI Pykes Creek TOOLERN VALE Reservoir Djerriwarrh River Reservoir Creek MYRNIONG Merrimu DIGGERS REST Reservoir BULLA Werribee Creek Creek LONG FOREST Shire of Melton Toolern BACCHUS MARSH Pyrites Djerriwarrh River MELTON ROCKBANK Melton Reservoir Western Water City of Wyndham Service Area Shire of Golden Plains Legend Waterway, reservoir or dam Western Water Service Area Municipal boundary Water Filtration Plant Recycled Water Plant capital Works Workforce performance report financial report APPENDICES & other Disclosures 1 Contents Focussed on Sustainability Focussed Section 1 Year in review 3 Highlights 3 Business at a Glance 3 Foreword from the Managing Director and Chair 4 Section 2 water Consumption & Drought response 6 Water Consumption 6 Drought Response 9 Section 3 environmental sustainabilitY 10 Sustainable Water Use 10 Other Statutory Obligations 13 Greenhouse Gas Emissions 14 Section 4 soCial sustainabilitY 16 Service Delivery 16 Customer Service 17 Section 5 governanCe & organisational struCture 20 Organisational Structure 20 Board 21 Section 6 workforCe 24 Human Resources 24 Occupational Health & Safety 25 Section 7 Capital works & other DisClosures 26 Capital Works Investment 26 Other Disclosures 27 Section 8 performanCe report 30 Auditor-General’s Report on the Performance Report 34 Section 9 finanCial report 36 Summary 36 Understanding the Financial Report 40 Notes to and forming part of the Financial Report 46 Auditor-General's Report on the Financial Report 84 AppendiceS 86 Disclosure Index 86 Bulk Entitlements Report 88 Global Reporting Initiative Index 91 annual report inDex 92 glossarY 93 Water consumption & environmental governance & YeAR in Review social sustainability 2 Drought response sustainability organisational structure About this Report 2010/11 t R EPO l R A nnu A this Annual Report presents Western Water’s challenges and achievements for the 2010/11 financial year in compliance with the reporting requirements issued by the Victorian Department Western Water Western of sustainability and environment. Our Vision, Values and Pathways Western Water’s Vision reflects principles and practices of sustainability that are embedded throughout the Corporation. this Vision is based on the belief that all people, as individuals and communities, must play a part in protecting and preserving our finite water resources. our Vision maintains a strong community focus. our Values embody how we will act, and define our behaviours. our Pathways drive strategic and corporate planning, focussing the whole organisation on building an economically, socially and environmentally sustainable future. During 2010/11, our third Pathway was changed from “to proactively manage our destiny” to “to actively manage growth”. this change reflects the significant impact on the business that will occur from the forecasted strong population growth in the region. OUR Vision OUR PAthwayS to be a leading service provider working with To be a valued and innovative service our community towards a sustainable future provider as judged by our customers and the wider community OUR VAlues t o drive an environmentally Commitment Accountability sustainable future Integrity Sustainability To actively manage growth Fairness Inclusiveness Leadership capital Works Workforce performance report financial report APPENDICES & other Disclosures 3 SECTION 1 yeAR In ReVIeW Focussed on Sustainability Focussed Highlights Financial Summary Local reservoirs recover to highest levels Net pre tax profit of $4.3 million in more than a decade Developer revenue of $17.1 million Return to local water supply through Capital expenditure of $31.3 million recommissioned Rosslynne and Merrimu Debt level now $129.0 million Water Filtration Plants Continued strong population growth of 3.9% Business at a Glance Capital works investment of $31.3 million completing: PRoPeRtIes • Stage 2 Upgrade of surbiton Park - Serviced assessments (including vacant land) 55,383 Recycled Water Plant - Serviced assessments (vacant land) 2,818 • Construction of two 10 million litre WAteR Supply drinking water storage tanks at Rosslynne and Merrimu Connected water customers 52,565 - Residential 49,571 • outfall sewer main for Gisborne south - Non-residential 2,994 • Installation of belt press dewatering Water consumption (Ml) 10,251 unit at sunbury Recycled Water Plant - Residential consumption (Ml) 7,846 - Non-residential consumption (Ml) 1,511 Secured funding to construct Gisborne - Water losses (Ml) 894 Recycled Water scheme (GRoWs) and Water mains* (km) 1,804 Mt Macedon Wastewater Management Water filtration plants 7 Improvement Program Chlorination plants 14 Significant reduction in lost time injuries seWeR service Two Gold Awards at Australasian Serviced sewer customers 49,131 Reporting Awards Connected sewer customers 46,628 Sewage treated (Ml) 8,442 Sewer mains (km) 1,120 ReCyCLeD WAteR Supply Recycled water plants 7 Recycled water produced (Ml) 7,992 Percentage reused 51% Recycled water mains - Class A, B & C (km) 102 * includes 39.3 km Class A recycled water mains Water consumption & environmental governance & YeAR in Review social sustainability 4 Drought response sustainability organisational structure Foreword from the Managing Director 2010/11 t R EPO and Chairman l R A nnu A the 2010/11 year has been one of dramatic climate variability in RecyClED WAtER the Western Water region. After 13 years of drought, many parts of the region recorded their highest rainfall on record. Capacity in Heavy rainfall reduced demand for recycled water this year with only 51% reused, down from 85% in 2009/10. Western Water is Western Water Western the major reservoirs increased significantly - from below 10% at the end of the last reporting period to the highest levels in more investigating storage options to further improve the opportunities than a decade. this has reduced the region’s reliance on external for recycling in the future. Funding has also been secured for water sources with our water filtration plants recommissioned and a new recycled water scheme to service a rapidly growing supplying local water to the region once again. agribusiness region in South Gisborne. Strong population growth has continued in Western Water’s Greenhouse GAS REDUCtion region, particularly in Melton and Sunbury. In the past ten years, Western Water reports greenhouse gas measures under the the customer base has grown by 44% and forecasts indicate this National Greenhouse and Energy Reporting Scheme. A national growth will escalate in the coming decades. change in calculation method produced a slight increase in Preparing for and accommodating this growth in an increasingly Western Water’s net emissions result this reporting period. unpredictable climate is the focus of Western Water’s strategic However, emissions will continue their downward trend in planning. the water supply business of the future must provide a future years. service that is affordable to customers, can meet environmental to date, the Biogas Cogeneration Facility at Melton, commissioned needs and be resilient to climate variability. in June 2010, has generated approximately 600 MWh of In March 2011, the Government released the living Melbourne electricity, equivalent to offsetting 738 tonnes of carbon dioxide. living Victoria roadmap which identified priority areas of urban With significant growth forecast in the Melton region, this water reform. It will change the way we look at water management project has the potential to offset carbon dioxide emissions and embed water efficiency within the community by focussing by 1,800 tonnes per year. on local solutions. these strategies will help safeguard our water resources for the future. Economic SustAINABIlIty this year Western Water made an overall surplus pre tax of INtEGRAtED WAtER CyClE Management $4.3 million which includes developer asset and cash contributions Western Water has continued work to ensure an Integrated Water of $17 million. the debt level has increased to $129 million, in line Cycle Management (IWCM) solution is part of the new toolern with the Essential Services Commission’s pricing principles. precinct which is expected to house an additional 50-60,000 Per capita water consumption in the region reached record people by 2030. All water sources are currently being considered low levels in 2010/11. this has significantly impacted forecasted in the solution including recycled water, stormwater, rainwater revenues. Prices must continue to rise to fund the capital and grey water. through collaborative stakeholder planning we investment required to manage growth as well as ensure have laid the plans for a stormwater pilot in toolern with potential a secure water supply through ongoing augmentation with to create a water neutral housing development with potential to Melbourne water supplies. Western Water prices are now create a water neutral housing development.