Desal plant costs blow out by more than $100 million
The cost to build a controversial desalination plant near Port Lincoln has blown out by more than $100 million.
The cost to build a desalination plant at Billy Lights Point has blown out by $140 million to $470 million, the State Government revealed on Friday afternoon.
But the cost to build at a competing site at Sleaford West – which was the preferred choice of a site selection committee made up of community and industry stakeholders – had also blown out to a massive $920 million, justifying SA Water’s decision to build at Billy Lights Point, the government said.
There has been vocal opposition to the plan to build the desal plant at Billy Lights Point, with aquaculture company Clean Seas Seafood, in its submission to the committee, arguing the plant would be a white elephant and that it was being built “at the site least favoured by the Port Lincoln community and the aquaculture industry, and in the location that carries the highest risk to the environment and industry’’.
“Any desalination plant in the Port Lincoln area risks being a ‘white elephant’ once the Northern Water site at Cape Hardy is constructed, which has the potential to provide water security to the Eyre Peninsula without impacting existing industries and the environment,’’ Clean Seas argued.
The State Government said on Friday that cost pressures had pushed the expected spend on the project up by almost 50 per cent.
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“SA Water has been working with ACCIONA to refine the project’s design to determine the final cost of delivering the plant as quickly as possible, while incorporating critical stakeholder feedback to minimise environmental impacts,’’ the Government said.
“Combined with continued global inflationary pressures, these important changes have resulted in a revised project cost of approximately $470 million, with first water expected to be delivered from the plant by the end of 2026.
“The final design includes constructing the plant’s marine pipeline infrastructure by tunnelling beneath the shoreline and inter-tidal areas to provide additional protection to the coastline and marine environments and locating the intake and outfall pipes – used to draw and return seawater to the plant – in deeper waters.
“This cost adjustment will not impact SA Water’s customers’ bills, with the additional expenditure to be managed through a re-prioritisation of the utility’s broader existing state-wide capital works program.’’
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The 5.3 gigalitre-per-year capacity plant is expected to start delivering water by the end of 2026.
The government said there was currently enough water allocated to cater for the region’s 35,000 SA Water customers.
“The Eyre Peninsula’s recently announced 2025-26 groundwater allocation for the Southern Basins, which is responsible for 75 per cent of the region’s drinking water, is sufficient to meet current demand,’’ the government said.
“This reaffirms that water restrictions on SA Water customers are not required, with residents encouraged to continue to use water efficiently around their property.’’
The government said that as well as being much more expensive, the Sleaford West proposal “was fraught with challenges, including difficult construction conditions, geological complications and distance from the existing electricity network’’.
Minister for Planning Nick Champion said the project would “future proof” the region.
“Both ACCIONA and McConnell Dowell helped deliver the successful Adelaide Desalination Plant and will bring invaluable experience to this vital project for the Eyre Peninsula,’’ he said.
“We’re delivering this infrastructure upgrade without placing extra financial pressure on households.
“The project is well underway, and we will deliver the first water from the new plant by the end of 2026 – which will be welcome news to residents who have suffered through years of unnecessary delays by the former Liberal Government.’’
