Renewable Desalination in Southeast Queensland

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  • 8/8/2019 Renewable Desalination in Southeast Queensland


    Bennett 1

    The Economic Aspect of Implementing Small-Scale Desalination

    in South East Queensland1

    Chris Bennett

    Targeted Research Project, Stanford University in Australia 2008

    Center for Marine Studies, University of Queensland

    Professor Ron Johnstone

    1 This study is a partner study to The Social Aspect of Implementing Small-ScaleDesalination in South East Queensland, Walker, W. 2008

    Center for Marine Studies, Autumn 2008

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    2. Abstract:

    South East Queensland is a water-sensitive region susceptible to extreme drought;water infrastructure is already under stress from development and conservative

    predictions show that water supply will be greatly outpaced by demand in thecoming years. One solution that would supply abundant, high quality, locally usablewater is desalination, a cost-competitive technology used worldwide and inAustralia on the large scale. Yet neither academic literature nor the Queenslandgovernment has investigated the economic appropriateness of this technology inSouth East Queensland at the small-scale level; this study evaluates the potentialuser market for desalination via a pilot survey of residents divided into two cohorts,residents from North Stradbroke Island and the Brisbane area. Using generalknowledge and choice preference questions, we examine the relationship betweenlocal water economy and willingness to use or pay for desalination services andhypothesize that a more stressed water economy will enhance openness todesalination. We found significant reported differences in the water economy thatcorrelate to the higher water stress in the Brisbane area; nearly 25% of respondentsfrom Brisbane compared to none from Stradbroke report to be effected by drought75-100% of the time, and 66% of respondents from Stradbroke report they areeffected 0-25% of the time. However, in violation of the hypothesis these differencesin the user market do not translate to a difference in openness between the twolocations, as willingness to purchase desalinated services is not significantlydifferent in either cohort. The most significant implication of this is that increasingwater stress in the future may not immediately enhance the economic viability ofsmall-scale desalination. More immediately, we conclude that although drought iscurrently having an unambiguous effect on the water market (amongst allrespondents nearly 75% currently use an alternative source of water), this does nottranslate to a sufficient openness to allow implementation of small-scaledesalination at the moment. Although more than half of all respondents wouldpurchase a desalination unit, 100% of respondents are not willing to pay anythingclose to the current price ranges of either conventional or renewable desalinationunits. Our pilot survey results were very significantly confounded by a small cohortand sample size (n=19 respondents), untested questions which lead to bias andskewed results, and unrepresentative and less than random sampling. Despite theseflaws, the preliminary results and literature and industry review suggest that at themoment, small-scale desalination is not economically implementable; a large-scale

    mail-based survey should investigate choice preferences on a broader scale to getmore accurate results, and should focus on cheaper community based desalinationsystem costs. In addition, future research could examine policy design and potentialprivate-sector technological advances that would help to bridge the substantial gulfbetween citizens economic constraints and desalination costs.

    3. Background and Research Focus:

    Center for Marine Studies, Autumn 2008

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    3.1 Climate and Water Supply in Queensland now and in the future, with a focus on

    North Stradbroke Island and Brisbane

    3.1.1 Climate Data and ENSO Variability

    As of January 2007, South East Queensland (SEQ) sat at an accumulated rainfall

    deficit of nearly 1400 mm.2This deficit is a larger part of a pattern of strong El-Ninoevents (longer, more intense drought than usual) and weak La Nina events (weakerrainfall than usual) that has transpired since 2001. Although 2008 has been therainiest year since 1999 at 1060 mm year-to-date, this is still only 150 mm aboveaverage, so SEQ still sits in a significant deficit.3 In fact, as visible in Figure 1, thecurrent rainfall deficit has no comparison in the 20th century besides that of thenotorious 8-year long Federation Drought from April 1898- April 1903.4

    2 SEQ Drought as of 2007, 13 SEQ Drought as of 2007, 2

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    Significantly, there is evidence that this is not just a blip on the screen, but part ofmore concerning long-term drying trend. Trends in total annual rainfall havedecreased somewhere from -20% to -40% depending on the part of SEQ, while from1900-2006, there is no significant downward trend.5 This is largely explained by theincrease in sea temperatures in the Southern Pacific Ocean that is in turn increasing

    the frequency and severity of ENSO events. At least in the short-term, it isconcerning exactly when the next severe El Nino even will strike; the 2005 and 2007events were relatively mild, and it is not since 2002 that a significant event hashappened. Taken together, these short-term trends and risks as well as the specterof a more significant drying trend require a substantial risk management response.As the Queensland Government suggests, it is imperative we properly adapt our

    5 SEQ Drought as of 2007, 6

    Center for Marine Studies, Autumn 2008

    Figure 1: SEQDrought2001-2007

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    infrastructure and land uses to this environment.6

    3.1.2 Current and Future SEQ Water Infrastructure and Water Economy in theBrisbane Area and North Stradbroke Island

    SEQ possesses a highly dynamic water grid that harnesses surface water, primarily

    from dams, as well as groundwater; a visual depiction of this can be found in Figure6 in Appendix 1. The primary bulk sources of water supply include water from theTraveston, Six Mile Creek, Wivenhoe and other dams far to the north, and especiallyrelevant to this paper, groundwater from North Stradbroke is a significant source asis visible in Figure 10.7Although it is beyond the scope of this paper to describe thisinfrastructure in any more detail, the bulk supply and transport scheme involves thedistribution of water by both State and Local governments in a complicated schemeinvolving more than 25 entities with transport and treatment assets.8 Thisconvoluted scheme results in fragmented ownership of local supply and differentwater prices at different areas. Given this lack of consistency, in this study the localwater supply of both the greater Brisbane Area as well as of North Stradbroke Islandwill be described briefly as they are significantly different.

    Brisbane is currently experiencing significant water stress, as the Australian NaturalResource Administration places Brisbane within 70-100% of developed waterpotential.9Since July 31 2008, Brisbane has been under High or Level 5 waterrestrictions, which require each person to use less than 170 liters/day, and actualuse has hovered below that. In addition to Brisbane city proper this applies toIpswich City, Gold Coast City Council, and other surrounding local regional councils.Brisbane has subsidies in place to encourage alternative water sources, such as the$900-$1150 subsidy for the installation of a rainwater catchment. Brisbanes watereconomy exhibits a substantial yearly connection fee (around $150 AUD) and then a

    tariff structure that varies between $0.59 and $1.12 AUD/m3 depending on annualuse amount.10 On North Stradbroke Island, however, water stress is much lesssignificant because of the huge groundwater stores on the island, which may yield amaximum potential use of 100,000 ML/yr. According to ANRA, extraction in 2004-2005 was 11,290 ML of a potential 30,000 ML, only 28%.11 Accordingly, waterrestrictions are more lax; prior to restrictions use was at around 300 L/day perperson, while it is currently just under Level 2 restrictions of 270 L/day.12 Waterpricing is different in Stradbroke; the base charge is more expensive at $200, andthe pricing varies between $1.28 and $1.96 AUD/m3 based on a dailytariff structurefor level of use. This more expensive rate reflects Redlands move to full-waterpricing after the Queensland Water Commission purchased the islands water

    6 SEQ Drought to 2007, 77 Urban Water Supply Arrangements in SEQ, 278 Urban Water Supply Arrangements in SEQ, 89 Brisbane Area GMU10 Brisbane Local Government11 Stradbroke Regional Water Resource Assessment GMU12 Redland Shire Council

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    resources.13 At average use levels, a Brisbane customer will pay around $1.12/m3,and an average Stradbroke resident around $1.28/m3 AUD. These local values differfrom national averages; in The Price of Water- Trends in OECD Countries, theOECD reports that per capita water use in Australia hovers around 250 L/day, whilethe average price of water in Australia in 1999 was $ 1.63 USD.14

    It is exceedingly difficult to quantify exactly how water demand will increase andhow that will effect pricing, but the Australian government has done somepredictions bas


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