How much Sydney water bills will rise by 2030 revealed

Sydney households face a $168 increase in water bills next year and a hike of more than 34 per cent by 2030 after the pricing regulator heeded calls for consumers to bear greater hip-pocket pain to finance infrastructure upgrades.

The 2025-26 price increase for Sydney Water customers was nearly double what the Independent Pricing and Regulatory Tribunal (IPART) had indicated it would set in a draft determination handed down in late May, and means the typical annual household bill will jump to $1328 in the next financial year.

Water bills will increase by 34 per cent over the next five years.Credit: Getty Images

Household bills will increase by 13.8 per cent in the next financial year, about double the 6 per cent rise flagged in the draft report that did not include inflation. Bills will increase by 5.1 per cent plus inflation for each of the following four years, above the 4.6 per cent, or $61 per year, initially foreshadowed by IPART.

Water bills will now be 10 per cent higher than they would have been under IPART’s draft determination.

Sydney Water’s submission for a 50 per cent increase over five years, including bills increasing by 20.7 per cent in the first year, sparked an outcry in the midst of a cost-of-living crisis. In response, IPART proposed a more conservative 23 per cent increase over the same period, but faced criticism the decision would hinder the supply of infrastructure for future housing.

In its final report on Tuesday, IPART said it was “vital” the utility’s “services and infrastructure keep pace with Sydney’s growth”, while stressing that the increases were less than Sydney Water’s initial submission.

“Sydney Water needs the capability to maintain and replace its assets, deliver necessary infrastructure to meet the increasing demands of population growth, and manage the challenges of climate change,” the report said.

“We consider prices and bills need to be higher to allow Sydney Water to fund the significant increase in efficient costs of meeting those requirements.”

As a state-owned monopoly utility provider, Sydney Water’s pricing is set on five-year terms by the regulator. Sydney Water services 5.4 million people and more than 122,000 businesses in the Sydney Metropolitan, Illawarra and Blue Mountains regions.

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The price hike would provide Sydney Water with $13.2 billion to spend on capital infrastructure, IPART said, an increase of $2.5 billion on the draft determination but $3.4 billion less than what the utility provider was seeking.

Urban Development Institute of Australia NSW chief executive Stuart Ayres said while it was an improvement, the decision “makes it impossible for NSW to build enough homes to meet our housing targets” without substantial public investment to meet requirements.

The final report is a compromise position. Developers and water infrastructure experts expressed concern that modelling underpinning IPART’s draft determination only assumed the construction of 120,000 homes by 2029.

Sydney Water’s proposal had been branded as “too high” by 200 individual submissions to IPART, with one calling it “too aggressive” and another a “ludicrous proposal”.

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