At the end of September Bega Valley Shire Council will take over the running of its 10 sewage treatment plants (STPs) in the shire after a decision 18 months ago not to renew the existing contract with Tenix, now owned by Downer.
Despite needing to take on 11 more staff to manage the maintenance and operation of the sites, council says it can save money by taking the on job. Annual costs with Downer were $3.3 million and council says that even with increased resources it would cost $3 million for council to manage and operate.
The original contract was seen as quite innovative when first introduced some 10 years ago.
A key aspect of contract was not only the requirement for the contractor to operate the plants on a day to day basis but to also take on all asset management processes to ensure the long-term sustainability of the plants.
However over the duration of the contract there has been “significant concerns” expressed by council that the level of capital works renewals has been insufficient. Council said the contractor confirmed it had allocated an average of $200,000 a year which amounts to the $2 million discussed in the original 10-year contract.
However, council has said that this was not sufficient.
“Calculations have indicated that current level of renewals expenditure should be in the order $600,000 per annum,” council said in its report.
Consultants have told council that there is likely to be a requirement for “significant new capital works” at the 10 Bega Valley sewage treatment plants.
“Additional works are required for more effective management of bio-solids production, high flows during wet weather and effluent disposal,” the council report states.
However the report also notes that that day to day operational performance of the plants has been good “particularly in the last two years”.
Three reports on this matter were provided to council – one of which was confidential. Reports went to council on March 16, 2016, November 23, 2016 (confidential) and February 1, 2017.
Council resolved to bring the plants back to BVSC operation.