REVISED economic modelling has delivered a turnaround of almost 15 per cent in Hunter Water's pricing proposal over the next several years, the utility has confirmed.
The authority has also indicated it would likely tighten water restrictions early next year without substantial rain, with a further tightening possible in June if the drought conditions in the region persist.
A public hearing is scheduled for Tuesday to let customers tell the Independent Pricing and Regulatory Tribunal what they think of Hunter Water's pricing proposal.
Announced in July, Hunter Water had said its proposal would likely involve price increases for most customers. The Newcastle Herald reported in September that the five-year proposal would originally have delivered a rise of $129, or 9.8 per cent above inflation, by June 2025.
But on Thursday Hunter Water chief financial officer Jennifer Hayes said customers would be better off by up to 7.2 per cent if the determination in March next year supports their revisited pitch.
"We have updated our modelling using lower forecast borrowing costs that are more reflective of current economic conditions and have revised our demand estimates as we continue to learn more about the impact of climate on water consumption," Ms Hayes said.
"We now anticipate that the prices our residential customers will pay will remain stable or decrease."
The utility estimated the average customer bill would drop from $1236 this year to $1147 by 2023-24, with a $65 or drop expected in the first financial year of the new pricing.
The proposal has also been updated to span four years rather than five in response to the Hunter's drought.
"We believe a shorter price path will provide us with the flexibility we need to deal with these uncertain conditions," Ms Hayes said.
The utility plans to spend $724 million over that timeframe in its biggest capital outlay since 2011. That would include major upgrades to both water and wastewater systems.
IPART will release a draft report and determination in March. Adjusted prices will commence from July 1 next year.
The public hearing will be held at Newcastle's Harbourview Function Centre from 10.30am to 2.30pm on Tuesday. Attendees are urged to register their attendance at ipart.nsw.gov.au before the event. A drop-in session will run afterwards until 7pm.
