The soaring cost of water services under a new Government plan is likely to hit Napier and Hastings ratepayers in the pocket as early as 2026.

Hastings District Council three waters manager Steve Cave said water meters are also expected to be considered by the new water management entity, regardless of which water delivery option is chosen in response to the Government’s Local Water Done Well reform. If the HDC’s preferred option is adopted, charges for water services, drinking, waste and storm, will be removed from Hastings’ rate accounts and sent separately by the new water organisation.

The average cost of water services for properties in Hastings, Flaxmere and Havelock North is about $1400 a year in 2024/25. Hastings Council estimates the initial increase for all households will be $400 pa for 2025/26. In 26/27 the cost would increase another $400 pa, taking the average water services bill to $2200. The council estimates in 10 years’ time the cost would be about $3100 per household per year. The council will spend $656 million on water infrastructure over the next 10 years.

“It is expected there will be a public conversation before a decision is made (on water meters); however, given other councils had seen a marked reduction in water use following the introduction of meters, the technology must be considered,” Cave said. “Given the constraints on our water allocation households, businesses and councils need to be more efficient with water use.” Cave said there was still a lot to discuss, but the cost of delivering drinking, storm and wastewater services will rise regardless of what option is chosen.

In Napier, the average annual water charge for connected urban properties is $941 pa (additional charges such as fire prevention not included). If Napier’s preferred option (the joint regional approach) goes ahead it estimates by 2026 the price will increase to $1200 pa and by 2034 the cost per annum will be $2800.

However, Napier City Council mayor Kirsten Wise said the only thing it was proposing at the moment was the preferred option of a Regional Council-Controlled Organisation (CCO) to deliver water services. “It’s important to note what we are currently doing is asking for guidance from our community on which model they want for water services delivery,” Wise said. “The model we decide to go with will be part of the water services delivery plan we submit to the government in early September.

“Whichever model we go with, the cost of delivering water services will increase. This is because of new rules and regulations. Taumata Arowai is the national water regulator that will enforce new standards. There are also new discharge and environmental standards that must be complied with. The Commerce Commission will also impose regulation that means water services must pay for themselves through fair charging that covers immediate and future needs.”

Local Water Done Well is the Government’s replacement to the controversial Three Waters policy. Government legislation requires councils to have a preferred option and at least one other for residents to provide feedback on. Napier and Hastings’ preferred option is to create a joint Council-Controlled Organisation (a regional CCO) with Napier, Central Hawke’s Bay and Wairoa councils. Both Councils say their preferred option is the most cost-effective.

LDR is local body journalism co-funded by RNZ and NZ On Air.