New Customer ContributionsApplication of the Essential Services Commission’s

New Customer Contributions framework

Revised June 2013

Table of contents 1. Introduction ....................................................................................................................................................... 2

2. Outline of the ESC’s NCCs framework ................................................................................................................ 3

2.1 Introduction ............................................................................................................................................... 3

2.2 Pricing principles ........................................................................................................................................ 3

2.3 Charging units ............................................................................................................................................ 3

2.4 Bring forward calculations .......................................................................................................................... 3

3. Integration with land development process ...................................................................................................... 5

4. Application of new framework for NCCs ............................................................................................................ 6

4.1 Barwon Water’s standardised NCCs ............................................................................................................ 6

4.2 Assumptions / definitions ........................................................................................................................... 7

a) Reticulation (or gifted) asset definition ...................................................................................................... 7

b) Growth assumptions ................................................................................................................................... 8

c) Areas eligible for application of standardised NCC .................................................................................... 8

d) Infrastructure sequencing assumptions ..................................................................................................... 9

e) NCC charging unit definition ...................................................................................................................... 9

5. Negotiation framework .................................................................................................................................... 10

6. Transition arrangements .................................................................................................................................. 10

Appendix A Proposed negotiation framework .........................................................................................................12

Appendix B Infrastructure sequencing plans ............................................................................................................ 17

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1. Introduction In August 2012, the Essential Services Commission (ESC) released a Guidance Paper on New Customer Contributions (NCCs). The paper flags a significant change in the approach to NCCs commencing on July 1, 2013. It moves away from a prescriptive approach to one that is based on pricing principles.

The ESC states that the objective of the new framework is to facilitate efficient and timely connection of new customers on a fair and reasonable basis, taking into account the benefit to the new customer relative the benefits realised by other customers.

In December 2012, Barwon Water released a draft consultation paper to:

• raise awareness of the new framework for NCCs proposed by the ESC (www.esc.vic.gov.au/Water/New-Customer-Contributions)

• outline Barwon Water’s draft proposal for application of this new framework

• seek feedback from the land development Industry in Barwon Water’s region on our proposed approach to the application of this new framework.

Since releasing the consultation paper, Barwon Water received feedback via:

• a developer forum held on January 24, 2013 attended by approximately 30 developers/developers representatives

• meetings with individual developers (five meetings)

• written submissions (10 received).

Feedback from the consultation with the land development industry and the ESC’s final determination on Barwon Water’s 2013 Water Plan has been considered in the preparation of this document.

3

2. Outline of the ESC’s NCCs framework

2.1 Introduction

Under the new NCC framework:

• water corporations are required to negotiate NCCs in accordance with pricing principles approved by the ESC

• procedural and information requirements relevant to services to which NCCs apply detailed in a negotiating framework

• developers will negotiate with water corporations and have recourse to the Victorian Civil and Administrative Tribunal (VCAT) for dispute resolution

• the ESC, through the five yearly water price review, will approve:

o NCC pricing principles o standardised NCC charges.

Water corporations may develop standardised NCCs consistent with the pricing principles and submitted by the water corporations in their Water Plans. These can be a single standardised charge for each service applicable for an entire water corporation’s service area or several geographically based standardised charges.

2.2 Pricing principles

The ESC requires that NCC charges will:

• have regard to the incremental infrastructure and associated costs attributable to a given connection

• have regard to the incremental future revenues that will be earned from customers at that connection

• be greater than the avoidable cost of that connection and less than the standalone cost of that connection.

Notes: 1. Given that NCC are to be based on the net incremental cost of connection (i.e. incremental costs net of

incremental benefits), in this context, the costs referred to in the efficient pricing bound are the net costs, specifically the avoidable net cost of connection and standalone net cost of connection.

2. Where the connection arrangement requires assets to be gifted, the value of gifted assets will be excluded for the purposes of calculating net costs.

3. Incremental costs may include financing costs associated with constructing an asset sooner than planned.

2.3 Charging units

Water corporations shall have the flexibility to choose the charging units for NCCs (e.g. lots, equivalent tenements, fixtures units etc). The charging units should provide a ‘fair and reasonable’ charge for each ‘occupancy’ based on the capacity utilisation of that occupancy. This is further detailed below in section 4.2.

2.4 Bring forward calculations

Financing costs relating to bring forward connections should be calculated in accord with the approved formula as set out in the ESC’s final determination. This is set our below:

Incremental financing costs (IFC) = (1 – [1 /(1 + r)n]) x capital cost of asset being provided sooner than planned.

This is where:

r = estimated pre-tax WACC (4.5%)

n = the number of years the asset is required sooner than planned

The new method is a change from the previous practice whereby “bring forward” charges were determined as 0%, 40% or 70% of construction costs depending on the “bring forward” category.

4

The ESC requires that water corporations intending to levy ‘bring forward’ charges will have prepared up to date Development Servicing Plans (Barwon Water terms these “Infrastructure Sequencing Plans”) that show the timing of when assets were otherwise expected to be constructed. These are included in Appendix B.

The proposed framework is shown diagrammatically in Figure 1.

Figure 1 – The ESC’s proposed NCCs framework

NCC pricing principles as set by the ESC

Standardised NCC charges, including eligibility criteria

Growth forecasts

Infrastructure sequencing

plans

NCC negotiation framework

Approved by the ESC for each water corporation during five

yearly price review

Apply negotiation framework

Development / connection

proposal

Apply standardised NCC charges if proposal

meets eligibility criteria plus bring forward

charge if applicable

Negotiate custom NCC consistent with pricing

principles

OR

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3. Integration with land development process The requirements set out in the ESC’s NCCs negotiating framework are in addition to any requirements or obligations contained in or imposed under the relevant legislation as well as Barwon Water’s Land Development Manual (LDM).

The LDM outlines policies and guidelines for customers to connect to water and sewerage services. Figure 2 below demonstrates where the NCC negotiation is proposed to sit in the development process. The negotiation framework is provided in appendix a.

Figure 2 – LDM – Developer works process NCC integration

Service advice request

Barwon Water response

Application for service requirements and costings

Letter of offer

Acceptance of letter of offer

Design approval stage

Developer works – construction stage

Consent to connection

Asset transfer and acceptance

(by Barwon Water)

Defects and maintenance stage

(Town) planning referral to Barwon Water

Planning permit conditions

Subdivision certification

Subdivision compliance

Negotiating framework for Barwon Water NCCs

6

4. Application of new framework for NCCs This section outlines how Barwon Water proposes to implement the new framework and includes:

• standardised NCCs for nominated areas within Barwon Water’s service area

• a negotiation framework for NCCs that integrates with Barwon Water’s land development processes

• Infrastructure Sequencing Plans that are used as the baseline for calculating the magnitude of the standardised NCCs and for determining the magnitude of ‘bring forward charges’ that may be applicable to new connections.

4.1 Barwon Water’s standardised NCCs

Barwon Water has developed standardised NCCs in accordance with the ESC’s pricing principles.

Barwon Water proposes area based standardised charges for each water, sewerage and recycled water connection as shown in Table 1 below. Standardised NCC’s are applicable only to new connections in eligible areas in accordance with Figure 3 below.

Barwon Water proposes separate standardised NCC charges for the following five geographic areas: (Area 2 to 5 standardised geographic charges to be developed when there is more certainty of timing and costs of servicing these potential future growth areas).

• Area 1: Existing planned growth areas, including infill but excluding Fyansford (uniform standardised NCC provided for these areas. The map shows areas eligible for Area 1 standardised charge). The indicative NCCs for Area 1 are provided in the table below.

Table 1 – Standardised NCCs for Area 1 (per new lot or premises in accord with Section 4.2 e)

Service Year 1 NCC Years 2 to 5 NCC **

Water $1,930.12 $2,612.79

Sewerage $841.54 $841.54

Class A recycled water * (Armstrong Creek and North Torquay)

$0.00 $0.00

TOTAL $2,771.66 $3,454.33

* All inputs to the recycled water NCC have been included with water NCC. This is because dual pipe schemes benefit all new customers by balancing supply and demand for water.

** Excluding CPI adjustment.

• Area 2: Fyansford (geographic based uniform NCC for this growth area to be developed during Water Plan 3 by applying core principles once more certainty around development in this difficult to service location is available).

• Area 3: Lovely Banks further investigation growth area (geographic based uniform NCC for this growth area to be developed by applying core principles should planning support for this area be confirmed and when there is more certainty around extent and timing of this difficult to service area).

• Area 4: Batesford South further investigation growth area (geographic based uniform NCC for this growth area to be developed by applying core principles should planning support for this area be confirmed and when there is more certainty around extent and timing of this difficult to service area).

• Area 5: Bell Post Hill West further investigation growth area (geographic based uniform NCC for this growth area to be developed by applying core principles should planning support for this area be confirmed and when there is more certainty around extent and timing of this difficult to service area.)

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4.2 Assumptions / definitions

The standardised charges for nominated areas have been developed based on assumptions on:

a) definition of assets funded by new customers and vested to Barwon Water

b) growth rates and distribution of growth

c) definition of areas eligible for standardised NCC

d) sequence of network extension into growth areas

e) charging unit definition.

Class A recycled water schemes have been mandated for Armstrong Creek and North Torquay growth areas. These schemes are aimed at maintaining the regions overall water supply and demand balance. Therefore the incremental cost of recycled water infrastructure in the designated dual pipe areas is included in the calculation of the standardised NCC for water services which is applicable to all new customers, not just those in the mandated recycled water areas.

a) Reticulation (or gifted) asset definition Considerable uncertainty and inconsistency has existed in the past in relation to the definition of assets that are funded by developers and vested to water corporations.

The following definition has been utilised by Barwon Water in the development of the standardised NCCs. This definition was favoured due to its simplicity and the fact that it is independent of whether the asset serves more than one development or not.

Reticulation (or gifted) asset definition

When connecting to a water corporation’s sewerage, water or recycled water network, a developer is required to provide:

• all reticulation assets

• NCCs.

A reticulation asset is defined as, “A water main or recycled water main that is DN150mm or less in diameter and gravity sewerage main that is DN225 mm or less in diameter, and all associated assets.” It is to be fully funded by the developer and vested to the water corporation, regardless of whether it is required to be sized or positioned to service other developments.

Associated assets that are deemed to be reticulation assets include, but are not limited to:

• sewer pump stations, emergency storages and rising mains (where the gravity sewer inlet to sewer pumping station is less than or equal to DN225 mm diameter)

• water or recycled water Pump Stations (where the pump discharges into water or recycled water mains of DN150 mm diameter or less)

• pressure reducing valves (where connected to water or recycled water mains of DN150 mm diameter or less)

• water and recycled water tanks (where outlet main is DN150 mm diameter or less)

• freehold land, reserves and or easements required to accommodate reticulation assets .

Other growth related assets and associated land tenure requirements will be provided by the water corporation, the incremental cost of which is recovered through the NCC charge and the bring forward charge (if applicable).

8

b) Growth assumptions

The overall regional growth assumptions used for determining the standardised charge were prepared by Barwon Water in 2012. The analysis, undertaken with assistance from consultants GHD, was consistent with available data including local government structure plans, G21, historical trends, infill development projections and government forecasts included in Victoria in Future (2012).

The forecasts have since been reviewed by consultants MacroPlan (2012). Table 2 summarises the growth assumptions adopted by Barwon Water as the basis for determining incremental capital and operating costs over the next 10 years.

Table 2 – Growth assumptions

Growth area Greenfield supply estimate

New lots/year 2011-2016

New lots/year 2016-2021

Total new lots 2011-2021

Infill

Armstrong Creek 22,000 350 550 4,500 0 0%

Barwon Heads 130 29 16 225 128 57%

Clifton Springs/Drysdale 4,250 135 155 1,448 294 25%

Lara 6,300 200 210 2,050 543 26%

Leopold 1,250 180 180 1,800 318 18%

Ocean Grove 5,600 200 220 2,100 669 32%

Pt Lonsdale (CoGG and BoQ) 660 35 40 375 227 61%

Portarlington 600 40 40 400 133 33%

St Leonards/Indented Head 1,340 25 25 250 104 42%

Balance of greater Geelong 2,750 820 720 7,700 5,005 65%

Total: greater Geelong 44,880 2,049 2,206 21,273 7,422 35%

Torquay 6,960 340 340 3,400 1,188 35%

Winchelsea 680 50 61 555 235 42%

Balance of Surf Coast 140 40 37 385 355 92%

Total: Surf Coast 7,780 430 438 4,340 1,778 41%

Bannockburn (South East Golden Plains)

4,730 120 100 1,100 190 17%

Balance of Golden Plains 780 90 91 904 383 42%

Total: Golden Plains 5,510 210 191 2,004 573 29%

Colac 2,610 56 65 605 358 59%

Elliminyt 800 35 32 337 101 30%

Apollo Bay 460 44 44 441 194 44%

Balance of Colac Otway 80 40 38 390 287 73%

Total: Colac Otway 3,950 175 161 1,510 940 62%

Total: G21 region 62,120 2,863 2,996 29,127 10,713 37%

c) Areas eligible for application of standardised NCC

The geographic areas shown in Figure 3 below may be eligible for application of the standardised NCC charge.

Only Area 1 (existing planned growth areas) has a defined standardised charge.

For Area 2 standardised NCC charges will be developed during Water Plan 3 by applying core principles.

Areas 3 to 5 will be developed at later date. This will be dependent on whether these areas receive planning support and when there is more certainty around extent, timing and cost of servicing these difficult to service areas.

Any proposed new connection outside of the nominated Areas 1 through to 5 would be subject to a negotiated charge utilising the ESC pricing principles.

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d) Infrastructure sequencing assumptions

Based on the growth rate and growth distribution assumptions, infrastructure sequencing plans have been developed showing the sequential and cost efficient extension of infrastructure into growth areas. The ESC document refers to these plans as development servicing plans.

The infrastructure sequencing plans are utilised for:

• estimating the incremental capital cost of extending the network to service growth (a key input to the standardised NCC calculation), and

• as a basis for determining whether ‘bring forward charges’ will be applicable to service a development.

The following summarises the general principles applied in determining an infrastructure sequencing plan for services within a growth area:

i. maximising the use of any spare capacity in existing infrastructure adjacent or proximate to the growth area;

ii. servicing lots on land abutting existing infrastructure;

iii. maximising servicing of lots which are located in the same gravity catchment / pressure zone as existing infrastructure;

iv. servicing whole gravity catchments / pressure zones where spare capacity exists;

v. for parcels of land (in single developer ownership) that straddle contours and lie in separate gravity catchments / pressure zones, servicing that portion which utilises the land which flows by gravity to existing infrastructure with spare capacity or that can be most cost efficiently augmented;

vi. where the “spare capacity” in existing infrastructure has been consumed the most efficient, least economic cost augmentation of the system is preferred. The preferred augmentation is one which delivers the most developable lots per dollar invested. (i.e. lowest $NPC/lot). This is likely to produce a priority order of augmentations over the life of the project;

vii. growth of areas and subsequent servicing to be determined by growth area forecasts which will outline a per year rate for development. Once the annual growth rate for the growth area is determined, the timing of the completion of each stage of logically sequenced network expansion within the growth area can be estimated within the overall framework.

These principles result in the most cost efficient sequence of extension of Barwon Water’s services into a growth area, and therefore minimize the magnitude of the standardised NCC applicable for all new customers in the eligible areas.

It is recognised that the growth pattern assumed in the infrastructure sequencing plan may not match the growth pattern desired by developers or other stakeholders. Should development proceed in a different pattern within the growth area, the standardised NCCs will still be applicable, however, a “bring forward charge” may be applied to cover the financing cost of infrastructure provided earlier than the sequence assumed in the standardised NCCs.

Infrastructure sequencing plans for Barwon Water’s key growth areas are provided in appendix b.

e) NCC charging unit definition

The payment of standardised NCCs for each additional connection which includes the following:

• any new lot on a plan of subdivision

• any new separate premises that is or can be metered

• any apartment, unit, or premises within a development (including mulit-story developments) that is or can be separately metered (regardless of whether or not it is subdivided)

• specialised, non sub divisional or higher water usage developments*.

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* Specialised, non sub divisional or higher water usage developments are charged on the basis of an equivalent lot calculation. An equivalent lot is a measure of the demand a connection will place on the infrastructure in terms of the water consumption and discharge for an average residential dwelling. A single equivalent lot will utilise a 20 mm tapping and meter. These include but are not limited to:

o Commercial developments o Industrial developments o Nursing homes o Private hospitals

o Schools or other non rateable properties o Caravan parks o Public open space o Sports grounds

One NCC charge will apply regardless of the size of the lot. This is a change from the previous practice where charges are based on lot size. NCCs are only payable in respect to the new lots or premises and no credit applies.

5. Negotiation framework Since the release of the draft determination by the ESC in March 2013, Barwon Water has consulted with other water corporations via Vic Water to develop a template for an NCC negotiating framework to improve consistency. Barwon Water’s negotiation framework aligns closely with this VicWater template.

Barwon Water’s proposed negotiation framework for NCCs is provided in appendix a.

The proposed negotiation framework outlines the connection applicant’s rights and obligations, the negotiation process and indicative timeframes.

6. Transition arrangements As the proposed Area 1 standardised NCC charge for properties receiving both water and sewerage services is higher than in the 2008 to 2013 regulatory period, Barwon Water proposes to introduce a transition to the new NCCs figures from July 1, 2013.

Barwon Water proposes to introduce a one year transition for water NCCs only.

Barwon Water has agreed to this transition arrangement after consultation with developers indicated a preference for a transition period. This will reduce the difference between the NCC in the 2008-2013 Water Plan and the NCC in 2013-2018 Water Plan. The figures are presented in Section 4.1.

Existing formal letters of offer containing different charges will remain unless the offer expires. It should be noted that offers are valid for 12 months from date of offer, if accepted within six months of that date of offer. An offer will expire based on the above timeframe and that other factors as outlined in section 2.6 of the LDM may also apply.

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Figure 3 – Geographic areas eligible for standardised NCCs

12

Appendix A Proposed negotiation framework

13

1. Application of negotiating framework

1.1 Purpose

This negotiating framework sets out procedural and information requirements relevant to services to which developer charges (NCCs) apply, as defined in the WIRO. NCCs are levied when new connections are made to the water corporations water, sewerage and recycled water networks. The framework sets out a process for Barwon Water and any “Connection Applicant” to negotiate in good faith to agree the price, standards and conditions of services to be provided. It also provides for transparent information to enable the “Connection Applicant” to understand the reasons for decisions made by Barwon Water.

The requirements set out in this negotiating framework are in addition to any requirements or obligations contained in or imposed under the Water Act 1989, the Planning and Environment Act 1987 (including under any planning scheme or permission), the Subdivision Act 1988, subordinate regulation under the described legislation, other relevant legislation or instruments as well as Barwon Water’s Land Development Manual (the “Regulatory Instruments”).

In the case of inconsistency between the “Regulatory Instruments” and this negotiating framework, the relevant “Regulatory Instruments” will prevail.

This negotiating framework does not alter the rights of a “Connection Applicant” to seek a review of a Barwon Water decision by the Victorian Civil and Administrative Tribunal (VCAT).

1.2 Who this negotiating framework applies to

This negotiating framework applies to Barwon Water in dealing with any property owner - generally a property developer – that is a “Connection Applicant” who requests connection to Barwon Water’s works in accordance with Section 145 of the Water Act 1989 (“Application”).

It also applies to Barwon Water in responding to such requests from a “Connection Applicant”.

1.1 No obligation to provide service, good faith obligation

Nothing in this negotiating framework imposes an obligation on Barwon Water to allow the “Connection Applicant” to connect to Barwon Water’s works or provide services to the “Connection Applicant”.

Barwon Water can refuse its consent, consent, or consent subject to any terms and conditions that Barwon Water thinks fit, as provided under Section 145 (3) of the Water Act 1989.

However, Barwon Water and the “Connection Applicant” shall negotiate in good faith the price, terms and conditions for services sought by the “Connection Applicant”.

2. Timeframes Barwon Water and the “Connection Applicant” will use their reasonable endeavours to achieve the following timeframes:

a) Agree the milestones, information requirements and any other relevant issues within fifteen [15] business days of Barwon Water’s receipt of an “Application”. An “Application”, under Section 145 of the Water Act 1989, for connection means a servicing request made to Barwon Water, the details of which are provided in Section 2 of the Land Development Manual

b) Respond to the “Application” giving details of the terms and conditions of the “Offer” to allow connection:

• within forty five (45) business days where a standardised NCC charge applies; and • within one hundred and twenty (120) business days where a negotiated NCC charge applies.

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c) Adhere to any timetable established for negotiations and progress negotiations in an expeditious manner; and

d) Finalise negotiations within one hundred and twenty (120) business days of the initial “Application”.

2.1 Commencing, progressing and finalising negotiations

Table 1 below provides an indicative timeframe regarding the process of NCC negotiations. As mentioned above, dependant on the location and specific requirements of the development, either a standardised or a negotiated NCC will be applicable. The timeframes for these two charges will differ. It is likely that a negotiated NCC charge will require additional design and modelling to be undertaken by Barwon Water and/or the “Connection Applicant”. The two timelines are presented below.

Table 1 – Indicative timeframes for negotiating connection

Step Actions

Timing standardised NCC charge (business days from application date)

Timing negotiated NCC charge (business days from application date)

1 Application (Section 145) for service requirements and costings of connection Application fee paid

Application date Application date

2

Negotiation meeting Parties discuss:

• the nature of the services required • any additional information to be provided by the “Connection

Applicant: and • notification and consultation with other persons potentially affected.

Parties agree to timeframes for negotiation and consultation and milestones if different to these indicative timeframes.

+ 15 (if required) +15

3

“Connection Applicant” provides additional information

“Connection Applicant” provides additional information to Barwon Water if requested. This includes:

• original completed application • additional information (if required).

20 35

4

Barwon Water investigation completed

This could include:

• where required, consultation with others potentially affected • additional designs and modeling.

35 90

5

Offer

Barwon Water makes offer in accordance with relevant regulatory instruments, including:

• terms and conditions of connection • NCC (i.e. developer charge) to apply and • such “Offer” will (unless otherwise specified) expire 12 months from

being made.

45 120

3. Provision of information by “Connection Applicant” The “Connection Applicant” must provide sufficient information to enable Barwon Water to assess the “Application” and determine the service requirements and costings for the development. The information generally required by Barwon Water is detailed in Section 2.3 of the Land Development Manual.

The level of information required by Barwon Water, and the detail of its response, will vary depending on the complexity and size of the development. As stated above, additional information may be sought by Barwon Water in the event of a negotiated NCC charge being sought.

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4. Provision of information by Barwon Water After consideration of servicing requests Barwon Water may provide an offer, via letter, draft agreement and/or notice (“Offer”). The “Offer” will include specific requirements for the particular development and also include various standard conditions and other information including charges and fees to achieve connection to Barwon Water’s assets. This includes NCCs.

The information relating to the “Offer” is detailed in Section 2.6 of the Land Development Manual.

The “Offer” is provided by Barwon Water pursuant to the “Regulatory Instruments”.

5. Pricing principles Barwon Water’s NCC charges will:

a) have regard to the incremental infrastructure and associated costs in one or more of the statutory cost categories attributable to a given connection

b) have regard to the incremental future revenues that will be earned from customers at that connection and

c) be greater than the avoidable cost of that connection and less than the standalone cost of that connection.

In setting charges, Barwon Water will also comply with:

a) the regulatory principles set out in clause 14 of the Water Industry Regulation Order (WIRO); and

b) specific pricing principles approved by the ESC as part of Barwon Water’s water plan applying at the relevant time.

6. Consultation with affected parties If Barwon Water considers that persons other than the “Connection Applicant” may be affected by proposed connection services, then:

• subject to legal confidentiality requirements, Barwon Water will share any necessary information with others potentially affected to assess impacts

• parties will allow sufficient time for reasonable consultation with affected parties to occur.

7. Payment of Barwon Water’s costs All developments of land requiring new or upgraded connection to Barwon Water’s system will incur associated fees and charges payable to Barwon Water.

Fees and charges levied by Barwon Water are subject to approval processes under the Water Act 1989 and/or as approval by the ESC. Details about the fees and charges can be found in Section 8 of the Land Development Manual, titled “Barwon Water Fees and Charges”.

Should the particular “Application” require a negotiated NCC charge, rather than the standardised NCC charge this will arise from the relevant negotiation, subject to the “Regulatory Instruments” in place at the time.

8. Termination of negotiations The “Connection Applicant” may elect not to continue with its “Application” and may end the negotiations by giving Barwon Water written notice of its decision to do so.

Barwon Water may terminate a negotiation under this negotiating framework by giving the “Connection Applicant” written notice of its decision to do so where:

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1 Barwon Water believes on reasonable grounds that the “Connection Applicant” is not conducting the negotiation in good faith;

2 Barwon Water reasonably believes that the “Connection Applicant” and the particular development will not be able to receive a service from Barwon Water; or

3 an act of insolvency occurs in relation to the “Connection Applicant”.

9. Dispute resolution In the event of a dispute between parties, Barwon Water will continue attempts to resolve the matter by negotiation.

After Barwon Water provides its “Offer”, if the "Connection Applicant” does not accept the “Offer”, generally the "Connection Applicant” has particular rights to seek a review in the Victorian Civil and Administrative Tribunal (“VCAT”) of the terms and conditions of connection and the NCC charge applied. These VCAT review rights, including various time lines, rights and process are set out in the Water Act 1989 and the VCAT Act 1998.

10. Giving notices The address for correspondence and notices to Barwon Water is:

Barwon Region Water Corporation

61-67 Ryrie Street

PO Box 659

GEELONG VIC 3220

A “Notice” must be:

a) in writing and signed by a person duly authorised by the sender; b) hand delivered or sent by prepaid post, facsimile or email to the recipient's address for “Notices”, as

varied by any “Notice” given by the recipient to the sender; and c) if given or received under any “Regulatory Instruments” or other statute of regulation must be given

under the requirements of that relevant instrument, or other statute or regulation.

11. Terms and abbreviations

Barwon Water – A water corporation established pursuant to Part 6 of the Water Act 1989;

Connection Applicant – The person making application to connect to the Barwon Water system pursuant to Section 145 of the Water Act 1989;.

Land Development Manual – Barwon Water's Land Development Manual, which outlines policies and guidelines for customers to connect to water and sewerage services, available at http://www.barwonwater.vic.gov.au/LDM/LDMstart/LDM.htm;

Standardised NCC charge – This is the standardised charge for “Connection Applicants” wishing to connect to the Barwon Water System

Negotiated NCC charge – This charge, derived from the NCC principles developed by Barwon Water will apply where the standardised NCC charge is not applicable due to the nature and/or locality of the development or arising out of negotiation with the “Connection Applicant”.

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Appendix B Infrastructure sequencing plans

18

Armstrong Creek Infrastructure sequencing plan

Infrastructure Sequencing Plan - Armstrong Creek East

2030

Legend

Sewer Main

Water Main

Recycled Water Main

Priority Sequence 1

Priority Sequence 2

Priority Sequence 3

Priority Sequence 4

2015

2016

2025

2025

2013 2013

2025

2016 2012

Infrastructure Sequencing Plan – Armstrong Creek West Precinct

2013

2014 2015

2018

2019

2022

2025

2027

2019

2018

2018

2018 2019

2020

2021

2020

2018

2017

2037

2033

2034

2024

Mt Duneed Recycled Water Tank

RW MLZ PRV2

RW MLZ PRV1

PW MLZ PRV1

2016

2026

2028

2031

2029

2030

2032

Legend Recycled Water pipeline Water Pipeline

Sewerage Pipeline

PRV Priority Sequence 1 Priority Sequence 2 Priority Sequence 3 Priority Sequence 4

2013

The timing of services to the Western Employment Precinct shall be inline with the

timing developed in the PSP when completed.

2020

2023

Infrastructure Sequencing Plan – North East Industrial Precinct

2013

2012

2014

2015

2014

2016

2017

2018

2019

2020

2021

2022

2023

2024

2025

2026

Legend Existing Sewer Main

Developer Funder PS and Sewer

Existing Water Main

Proposed Water Main

Proposed Recycled Water Main

Priority Sequence 1

Priority Sequence 2

Priority Sequence 3

Priority Sequence 4

Potable Water PRV

Infrastructure Sequencing Plan – Horseshoe Bend Road Precinct

2015

LLZ PRV

LLZ PRV

2016 2018

2017

2015

2016

2017

2019

2017

2016

2015

2016

2020

2017

2022

2021

2023

2025

2024

2026

2028

2027

2031

2029

2030

2021

2032

2022

2033

2034

2035

2037

2036

2038

Legend

Existing Sewer Main

Proposed Water Main

Proposed Recycled Water Main

Priority Sequence 1

Priority Sequence 2

Priority Sequence 3

Priority Sequence 4

MLZ PRV

MLZ PRV

Infrastructure Sequencing Plan – Armstrong Creek Activity Centre

Water

MLZ PRV2

Legend

Sewer Main

Water Main

Recycled Water Main

Priority Sequence 1

Priority Sequence 2

Priority Sequence 3

Priority Sequence 4

Recycled Water

MLZ PRV2

2014

2016

2014

2032

2016

2017

2015

2040

2039

2033 2045

2043

2044

2042

2037

2041

2036

2039

2038

2015

2037

2036

2039

2041

2038

2040

2032

2039

2033

2034

2035

19

Bannockburn Infrastructure sequencing plan

Bannockburn – Infrastructure Sequencing Plan (ISP)

12-16

17-20 38 - 47

48 - 56

20

23

19

22

25

30

28

26

32

34

21

24

27

31

29

35

33

36 37

Legend

Priority Sequence 1

Priority Sequence 2

Priority Sequence 3

Priority Sequence 4

12

14

13

18

16

17

12

15

20

Jetty Road Infrastructure sequencing plan

Infrastructure Sequencing Plan – Jetty Road

21

Lara West Infrastructure sequencing plan

Infrastructure Sequencing Plan - Lara West

22

Leopold South Infrastructure sequencing plan

Infrastructure Sequencing Plan – Leopold South

23

Ocean Grove North Infrastructure sequencing plan

Infrastructure Sequencing Plan – Ocean Grove North

2017

2016

2017

2015

2021

2024

2022

2014

2025

2019

uu

2018

2016

2024

2020

2023

2028

2025

2026

2027

2014

2032

2031

2030

2029 2013

2015

2033

2034

2012

HLPS

and

Tank

Banks Rd

PS

Legend

Water Pipeline

Sewerage Pipeline

Priority Sequence 1

Priority Sequence 2

Priority Sequence 3

Priority Sequence 4

2018

24

Torquay North Infrastructure sequencing plan

Infrastructure Sequencing Plan (ISP) – Torquay North

2023

2021

2019 2020

2022

2014

2016

2013

2015

2018

2024

2023

2019

2014 2015

2016 2017

2018

2017

2019

2018

2024

2025 2026 Legend

Recycled Water pipeline

Water Pipeline

Sewerage Pipeline (Dev Funded)

(Existing)

Priority Sequence 1

Priority Sequence 2

Priority Sequence 3

Priority Sequence 4