Part 1: Three Waters

This section describes the planning context for Part 1 of the infrastructure strategy and provides a snapshot of the three waters services we provide.

1.1 What is an Infrastructure Strategy?

The 30-year infrastructure strategy is a core component of the DCC’s future planning and strategic framework. Ensuring reliable and quality drinking water, wastewater and stormwater services is essential to Dunedin’s vision of being one of the world’s great small cities.

As part of the DCC’s long-term plan, the infrastructure strategy lays out the challenges of maintaining our assets, accommodating growth and changing demand, managing our environmental impact, and confronting long-term issues like climate change. Our long-term plan forecasts the resources needed for ongoing infrastructure renewal and replacement, and includes funding for projects providing solutions to our challenges for the first 9 years up to 2033/34, with longer 30-year budgets signalled in the infrastructure strategy. The DCC’s financial strategy sets the parameters for funding and financial impacts on ratepayers.

1.2 Our approach to the 2025-2055 Infrastructure Strategy

We aim to deliver three waters services to our communities in a cost effective, sustainable, and coordinated manner, consistent with our vision, strategic framework, and long-term objectives.

As a provider of three waters services, the DCC operates within a diverse range of drivers, navigating central and local government policy and regulations, as well as the DCC’s own strategic goals and community expectations regarding services and affordability. This can lead to conflicting priorities in planning and funding. Examples of these drivers include regulatory compliance, maintaining services levels, continuing renewal of ageing infrastructure, and the ability to respond to the growth and urban development obligations contained in the Second Generation District Plan (2GP) and Future Development Strategy 2024 – 2054 (FDS). Decision-making ultimately requires the DCC to balance financial sustainability and affordability, prioritising a long-term programme that continues to improve infrastructure performance and asset management, while accommodating growth and development.

Structure of this document

Section 1: Three Waters Overview - The planning and regulatory context for the three waters part of the Infrastructure Strategy and outline of our infrastructure

Section 2: Our Challenges - The significant three waters challenges faced by the DCC and where we want to be positioned as we respond to these issues and opportunities

Section 3: Our Performance - How are we doing, the current state of three waters service provision, asset condition and performance

Section 4: Our Plan - How we are going to get to where we want to be, the preferred scenarios for managing three waters challenges and opportunities.

Section 5: Delivering on Our Plan -  How we will deliver on our plan, providing an overview of highest three waters priorities and proposed expenditure over the term of the strategy.

1.3 Three waters planning and regulatory environment

Three waters activities are undertaken within a complex system of legislative and regulatory requirements (Table 1).

Table 1: Key legislative, regulatory and planning framework drivers impacting three waters infrastructure and services

The legislative and regulatory systems for three waters activities continue to undergo substantial change. Key areas of legislative and regulatory changes are anticipated to present challenges and opportunities for DCC three waters activities in the early years of this Infrastructure Strategy include three waters regulatory and Local Water Done Well (LWDW) service delivery changes, and resource management system reforms. We will continue to monitor the changing landscape and respond proactively to ensure our services remain effective and sustainable.

1.3.1 Strategic Context

The DCC’s own strategic planning framework provides the context for three waters infrastructure management. Anchored in the four wellbeings, the City’s community outcomes and the vision of making Dunedin one of the world’s great small cities, it guides three waters activities and our responses to the challenges we face. The DCC strategic framework is described in Section 2 of Dunedin’s 9 year plan 2025-34. Table 2 outlines the elements of the framework that directly inform the Infrastructure Strategy.

Table 2: DCC strategy and policy priorities informing the Infrastructure Strategy (Part 1: Three Waters)

*There are also specific priorities outside the 3 Waters Strategic Direction Statement (SDS). The additional priorities reflect responses to changes and events occurring after the development of the SDS, including:

• A significant increase in forecast growth for the city. The SDS forecasted an 11% population growth over its 50-year horizon, translating to approximately 135,900 by 2060. Recent population estimates for 2024 indicate we are already very close to this 50-year forecast, with Stats NZ estimating our 2024 population at around 135,700.
• Changes to urban development priorities due to increasing population forecasts, the review of the District Plan, the subsequent adoption of the 2GP, and the adoption of the Future Development Strategy.
• Responding to flooding in South Dunedin.
• The Council’s declaration of a climate emergency in 2019.
• Ongoing challenges with maintaining and renewing an ageing asset base in challenging economic times.

1.3.2 System planning and Dynamic Adaptive Planning Pathways

The DCC has recently completed a three waters strategic planning project to inform its 30-year Infrastructure Strategy. The Integrated System Planning (system planning) programme outlines a 50-year strategic plan, identifying future investments needed to maintain and adapt three waters services to current and future standards while keeping them affordable for the community.

The programme uses a Dynamic Adaptive Planning Pathways (DAPP) approach to map out a ‘core pathway’ for future investments. DAPP, originally developed for climate adaptation, is now widely used in infrastructure planning to manage future uncertainties by identifying multiple options and the signals that might necessitate a shift to a different option. Dunedin City Council (DCC) is one of New Zealand’s early adopters of this method for three waters planning.

Only projects on the ‘core pathway’ identified through system planning are included in the 30-year programme in section 4 ‘Our Plan’. This programme is supported by monitoring key variables such as population forecasts, sea level rise, legislative changes, and asset performance. This monitoring helps determine when and how the programme needs to adapt to meet current and future challenges. Unexpected changes in these variables may lead to adjustments in the timing or selection of projects, which will be reflected in future Annual and Long Term Plans.

1.3.3 Community Outcomes

Investing in Dunedin’s infrastructure supports the city’s community outcomes and the vision of making Dunedin one of the world’s great small cities. The three waters aspects of the infrastructure strategy directly contribute to the city’s following community outcomes:

• A healthy city with reliable and quality water, wastewater and stormwater systems
• A sustainable city with healthy and treasured natural environments
• A successfulcity with a diverse, innovative and productive economy

Table 3 highlights some of the projects that play a role in achieving these community outcomes.

Table 3: Infrastructure Project Links to Communty Outcomes

1.4 Our Infrastructure

We own and manage $3.956B of three waters infrastructure (based on replacement values as at 30 June 2024 adopted in the DCC 2023/24 Annual Report). This includes pipes, pumps, and treatment plants.

Water Supply Our water supply infrastructure collects, conveys and treats raw water, then distributes treated water to ensure the provision of safe and reliable drinking water. This supports the health, safety and well-being of residents, as well as economic activities in our community.

Wastewater Our wastewater infrastructure protects public health and the environment by collecting and conveying wastewater from homes and businesses, treating it to a high standard before discharging it to the environment.

Stormwater Our stormwater infrastructure protects public health and the environment by piping rainwater away from homes, properties and roadways to prevent flooding and minimise waterway pollution.

Water Supply

• $1.61B in assets
• 4 registered drinking water supplies (serving 45,248 properties)
• 21 consented water abstraction points
• 9 water supply dams
• 62 treated water reserves
• 1,742km pipe networks ( including service lines)
• 21 pump stations

Wastewater

• $1.57B in assets
• 7 wastewater schemes (serving 50,093 properties)
• 927KM of pipe network
• 78 pump stations
• 7 treatment plants
• 18 discharge permits (6 coastal, 4 land, 2 water and 6 air)

Stormwater

• $0.78B in assets
• 20 stormwater catchments
• 393km of pipe network
• 11 pump stations
• 11 consented discharge (reminder are permitted activities)

This section outlines the challenges and opportunities the DCC faces in three waters strategic long-term infrastructure management.

Content is organised by a set of key drivers based on what the DCC plans to achieve within an infrastructure strategy and their alignment with the challenges and issues we face in our delivery of services.

Table 4: Key drivers and challenges

2.1 Looking after our people and place

Drinking water, wastewater and stormwater infrastructure services contribute to public health and environmental outcomes. The DCC must ensure it supplies safe drinking water and manages the environmental effects of water abstraction and discharges from its wastewater and stormwater systems appropropriately. Three waters systems also impact the environment through greenhouse gas emissions from wastewater treatment processes and energy use. Urban form, which is influenced by the availability of three waters services, is also a key contributor to Dunedin’s long-term emissions.

Improvements to our three waters assets are required to keep pace with increasing public health and environmental expectations. Investment is required to maintain current and future service levels, including enhanced protection of drinking water sources, improved water management practices, and new standards for drinking water, wastewater and stormwater services.

The three waters system planning programme will guide capital investment and support the continued provision of safe drinking water to serviced communities and improved environmental outcomes. Objectives developed with the ORC and our mana whenua partners during the project include:

• Regeneration – protecting and enhancing the natural environment, aligning with Tikaka and Kawa, contributing to carbon zero targets,
• Resilience – adapting to climate change, robust, recoverable and flexible response to incidents and natural disasters
• Efficiency – minimising wastage, reducing cost impacts to customers, and providing services in the right place at the right time to support growth.

Under section 125 of the Local Government Act 2002, as modified by the Water Services Act 2021, DCC must assess access to drinking water, wastewater and other sanitary services in Dunedin every three years. This assessment evaluates the adequacy of services from a public health and environmental perspective. A DCC servicing assessment is currently in progress.

2.1.1 Public Health and Environmental Outcomes

The DCC needs to continue maintaining and improving its drinking water supply systems to ensure compliance with drinking water legislative and regulatory requirements and to protect public health. The Water Services Act 2021 sets out the duties of drinking water suppliers. These include a duty to supply safe drinking water, to comply with drinking water standards, and to provide a sufficient quantity of drinking water. The DCC must also comply with the Drinking Water Quality Assurance Rules 2022 (DWQAR):

• The drinking water standards set maximum acceptable values for substances, organisms, contaminants or residues that may be present in drinking water.
• The DWQAR includes monitoring and assurance rules:
  • Monitoring rules must be complied with to demonstrate compliance with the drinking water standards.
  • Assurance rules cover activities that water suppliers need to undertake to manage risks to drinking water safety.

The DCC must also have drinking water safety plans for all drinking water supplies to identify risks to drinking water safety and how they will be managed - from the raw water catchment to the treatment plant and within the distribution network and operate in accordance with those plans. These plans need to be regularly updated and submitted to Taumata Arowai.

Accountability for environmental outcomes is managed within a national and regional planning framework supported by resource consents for three waters activities that impact the environment and people. Objectives, policies and rules set in national policy statements, national environmental standards, the Otago Regional Policy Statement and regional plans manage activities such as discharges to water, air and land, and the taking, damming and diversion of freshwater. These objectives, policies and rules are often put into action through conditions of resource consents.

The provisions of these policies, plans and standards will impact future consenting of discharges from the DCC’s wastewater treatment and water treatment plants. Requirements will also impact future consenting of new and existing water takes. Anticipated impacts on DCC water supply activities include tighter controls on the DCC’s ability to take water from the environment for drinking water supply purposes and a related emphasis on implementation of water efficiency and demand management measures in drinking water supply systems. Current water take consents do not expire until 2038-41. These changes will require major decisions regarding where and how raw water is sourced if surface water takes are reduced, how and where it is stored and used most efficiently.

The DCC holds resource consents to discharge treated wastewater to the environment for each of Dunedin’s seven wastewater treatment plants, except for Mosgiel where treated wastewater is transferred to the Green Island wastewater treatment plant for further treatment before discharge to the ocean. Most resource consents the DCC holds to discharge wastewater are due to expire within the next 10 years. Projects are in progress to investigate practicable options to inform applications for new consents and to address anticipated new standards. Substantial changes to current wastewater management arrangements in Waikouaiti/Karitane, Warrington and Middlemarch are planned to better align with national and regional policy direction and Mana Whenua values, and to increase resilience to climate change impacts. This work relates to renewal of ageing infrastructure and improving outcomes in environmentally and culturally significant and sensitive areas. Wastewater infrastructure on the Northern Coast (eg. Waikouaiti/Karitane and Warrington) is also vulnerable to sea level rise. In addition, work is underway to reduce the volume of solid waste produced by the wastewater treatment process requiring disposal to landfill. These projects are described in section 4 ‘Our Plan’.

The DCC currently has five constructed wastewater network overflows authorised by resource consents. These overflows are designed to manage the public health risk in heavy rainfall events by allowing discharge of diluted wastewater to waterways at specific points in the network, rather than in an uncontrolled manner at low points in the network (including into private property). The consented overflows are signposted to alert the public to the potential risk of exposure to diluted wastewater in the event of heavy rainfall. As wastewater assets are renewed and upgraded, these overflows will activate less often with smaller discharges. The current overflow consents expire within 8 -18 years time. It is anticipated the quantity and quality of wastewater discharges will be subject to stricter requirements under future planning rules.

The DCC holds resource consents to discharge stormwater to the coastal marine area that expire in 2048. Key stormwater discharges are subject to environmental monitoring as part of consent requirements. Stormwater system planning has included a review of historical monitoring data, a broader environmental monitoring programme including the monitoring of freshwater bodies and updates and improvements to computer-based hydraulic models. Data from this and ongoing monitoring will be used to prioritise catchments for targeted improvement works to address stormwater quality and quantity issues. Where practicable, green infrastructure approaches will be favoured. Under the current Regional Plan: Water, most of Dunedin’s stormwater discharges to freshwater are permitted, subject to certain provisions. It is anticipated the quantity and quality of stormwater discharges will be subject to stricter requirements under future ORC planning rules, including requirements for discharges that are currently permitted to require resource consents.

A significant amount of the city is serviced for stormwater drainage by privately owned and maintained watercourses, open channels, pipes and streams. Where these private watercourses have been piped, many of the pipes are 100+ years old and in poor condition. As rainfall intensities increase this private infrastructure can sometimes no longer cope resulting in property damage, flooding, sinkholes and landslips. Developing solutions to complex watercourse problems is often beyond the means of most landowners. The Government has indicated that the Local Government Water Services Bill (expected Dec 2024) will provide new tools and clarification of roles and responsibilities to support stormwater management, including the management of overland flow paths and urban watercourses.

2.2 Looking after our assets - replacing and renewing Dunedin’s ageing infrastructure

As one of the country’s earliest metropolitan centres, some of Dunedin’s three waters assets are more than 150 years old and still operate as essential pieces of the network today. As Dunedin has grown, so have three waters networks, resulting in widely distributed networks with a broad range of pipe materials, diameters and construction methods.

Some three waters assets require replacement based on their age and condition and the likelihood they will not be able to maintain service levels in the future. An example is old, earthenware pipes in our wastewater network that become cracked over time letting in groundwater and causing wastewater overflows, failing levels of service and not responding to climate change or weather events. Without continued spending on renewal of these assets they and their performance will deteriorate further.

The DCC is increasing spending on renewals over time. In some circumstances, ‘like-for-like’ renewals may no longer be enough to meet the needs and expectations of the community and regulators. This means it is likely the proportion of new capital against renewalsI funding will increase to allow for upgrades that provide capacity for growth and resilience to climate change impacts.

The DCC will manage the renewal and replacement of ageing infrastructure by planning to renew assets as they reach the end of their useful lives or are shown to be in poor condition; with an aim to increase the level of renewal delivery year on year. Where feasible pipes will be rehabilitated rather than completely renewed, using techniques such as re-lining. These techniques offer faster, less disruptive works and provide an environmentally acceptable and highly durable solution where appropriate and feasible. This extends the useful life of existing assets at a lower overall cost to ratepayers. Wastewater, stormwater, and water supply pipe networks can be rehabilitated using this approach. However, there may be areas where such methods are not feasible or won’t deliver the desired project outcomes, such as increasing pipe capacity to support growth.

Renewals and rehabilitation are targeted in areas with the highest risk of failure and where possible are programmed to enable efficiencies between three waters and projects being undertaken by other areas within the DCC (e.g. road rehabilitation).

Assets reaching the end of their theoretical life don't always require replacement. Performance or condition may indicate that the asset can continue running beyond its theoretical life within acceptable levels of risk, especially for non-critical assets like the water tobies connecting each property to the water supply.

The DCC’s planning focuses on assessments of asset condition, criticality, and risk, as well as planning and delivery opportunities to provide lasting value for residents, businesses and the environment through long-term asset solutions. Asset management planning is most efficient and effective when considering all options holistically, including renewals and upgrades. This approach can identify opportunities for systemic improvements, extending network life while maintaining service levels, and in some cases, achieving improved levels of service that add value to the community and the environment.

The DCC three waters reticulation, plant and civil assets, valued at $3.956 billion and a current depreciated replacement value of $1.577 billion as at the 30 June 2024 Annual Report. This plan’s renewals spending significantly increases from previous 10-Year Plans due to the ageing asset base, which requires more renewals requirements and poses a risk of not meeting stated service levels as assets deteriorate. Higher capital expenditure budgets allow for a greater rate of renewals. To support this increased programme, the DCC has implemented new delivery models and established longer term contracts with contractors and service providers. Section 4 ‘Our Plan’ provides more details on how we will deliver a capital expenditure programme to replace and renew ageing infrastructure.

2.3 Providing for infrastructure resilience

Flooding, drought, catchment fire, landslides, rising groundwater and ground movement and liquefaction in the event of an earthquake are the natural hazards posing the most significant risks to Dunedin’s three waters infrastructure. It is anticipated that many of these risks will increase over time as a result of climate change.

The DCC is working to improve its understanding of natural hazards and for the resilience of its infrastructure into the future. Natural hazards pose a lesser risk when infrastructure is resilient.

We will manage the challenges posed by natural hazards by ensuring investment in renewals and new capital specifically considers reducing the risk arising from natural hazards, increasing resilience and where possible will consider adaptive planning.

2.3.1 Flooding and landslide

Some parts of Dunedin are susceptible to flooding and landslides during heavy rainfall. These events damages homes, businesses and infrastructure. More extreme rainfall events and storm surges may lead to larger and more frequent slips that can damage three waters infrastructure. As weather events become more frequent and severe the ability of infrastructure and the community’s ability to recover will be put under increasing pressure.

Flood risks are due to several factors including :

• Rainfall events exceeding design tolerances
• Limited capacity in parts of the wastewater network as a result of inflow of rainwater and groundwater infiltration from ageing and cracked pipes and direct stormwater connections into the wastewater network
• Low-lying areas where the groundwater is close to the surface so rainwater cannot drain
• Catch pits can become blocked and creating a flooding hazard
• Roading infrastructure at low elevations can cause roads to be flooded or cut off
• Sea level rise, more extreme rainfall events and storm surges increasing the frequency of flood events in the future
• Manhole surcharging can create a safety hazard in flood events when manhole covers become dislodged.

Work to reduce inflow and infiltration into the wastewater system by replacing ageing pipe infrastructure is critical to building network resilience and reducing flood risk and potential threats to public health in flood events. Inflow occurs when stormwater enters the wastewater network through direct connections like manhole covers, while infiltration refers to groundwater seeping in through cracks or joints in the pipes. Excessive inflow and infiltration can overwhelm the wastewater system, especially during heavy rainfall, leading to overflows and increased treatment costs. Sealing manholes, prevents stormwater from entering the wastewater network, reducing the risk of overflow events.

2.3.2 Drought

Prolonged periods of drought pose a risk to Dunedin’s water supply. Water demand increases during these periods while drier water catchments yield less water and are more prone to large-scale fires. Catchment fires can result in highly turbid water that is more expensive to treat or is unable to be treated by existing treatment processes. Higher mean temperatures increase the risk of algal blooms within raw water reservoirs, which may require expensive treatment. In addition, odour issues at wastewater treatment sites and within the wastewater network are more likely at higher temperatures. Lower water yield in periods of drought impacts raw water reservoir levels. Water use restrictions are used to balance supply and demand on the network and were put in place in Port Chalmers, Outram, Waikouaiti and Karitane during the summers of 2023 and 2034.

2.3.3 Earthquake

Seismic activity can cause widespread damage to infrastructure. Destruction of critical built infrastructure such as dams, treated water reservoirs (dams), treatment plants and displacement of piped infrastructure can render three waters systems inoperable and unable to deliver clean drinking water or to transport and treat wastewater safely. Liquefaction can cause more damage to underground pipes than ground movement and is a significant contributor to pipe failure in earthquakes. Dunedin has several areas with moderate to high likelihood of liquefaction in an earthquake.

Seismic activity could also cause isolation across the transport network if certain areas are cut off due to rubble, slips, liquefaction or land displacement. Dunedin is vulnerable to isolation given the limited number of routes in or out of the city. Dunedin is predominately serviced by a motorway inwards from the north and a motorway inwards from the south with the alternative route from the north on Mt Cargill Road. Dunedin’s Akatore fault has potential to disrupt the network to the south of the City. Disruption of transport links would likely slow the rate at which three waters services can be restored, as suppliers and materials will either not be able to reach Dunedin, or will have to follow alternative routes (e.g. shipping).

2.3.4 Climate change

The effects of climate change are more becoming more evident and more frequently experienced. Climate change impacts include more extreme rainfall events, causing increased frequency and severity of flooding, while experiencing less rainfall overall can impact on water supply. Dry periods increase water demand, the risk of drought and catchment fire (which impacts on drinking water quality).Rising sea levels pose risks for infrastructure located at or near sea level. Managing risks and building resilience within our three waters infrastructure to protect both our assets and the assets and wellbeing of the community is a priority,as is ensuring three waters systems play their part in reducing greenhouse gas emissions to support efforts to reduce the severity of climate change (see 2.5 below). As weather events become more frequent and severe, the ability of infrastructure and communities to recover will be put under increasing pressure. The DCC’s Climate-related significant forecasting assumptions for the 2025-34 9 Year Plan have informed the development of three waters asset management plan and the infrastructure strategy.

Dunedin has significant low-lying areas that are within 0.5m of the current spring high tide mark (estimated at 2,684 Dunedin homes, 116 business and 35km of roads -Source: Parliamentary Commissioner for the Environment (2015) Rising Seas).

Older people and vulnerable populations find it more challenging to manage the impacts of natural hazards. South Dunedin has an increasingly ageing population and one of the highest deprivation index demographics in the country.

Rising groundwater as a result of sea level rise in low-lying areas is a significant risk facing Dunedin from climate change. High groundwater can cause problems such as increased frequency of flooding, boggy ground and surface ponding, damage to infrastructure and buildings, and a risk of liquefaction in earthquakes along with associated social wellbeing issues. This is a factor in flooding in South Dunedin. The DCC 3 Waters Group is working with the South Dunedin Future (SDF) programme in assessing and selecting adaptation pathways for South Dunedin.

2.4 Meeting our changing needs - responding to changes in demand for infrastructure

The DCC is preparing for growth through three waters asset capacity assessments and targeted capital works. Factors such as population growth, economic growth, housing development rates and locations will impact infrastructure demand. Effective asset management involves investments that address both service levels and future capacity while simplifying complex networks to reduce future repair and maintenance costs.

The DCC’s 2025-2034 9 year plan significant forecasting assumptions for economic growth, demographic change and housing requirements have informed the development of our 30-year infrastructure strategy.

Dunedin’s population is expected to grow over the next 10-20 years. The DCC adopted a high-medium growth scenario for Dunedin’s 9 year plan 2025-34, assuming high growth from 2025-34 and medium growth from 2035-55.

Dunedin faces several issues within its three waters networks, including:

• Water availability in summer in some parts of the city due to high demand and drought, resulting in use restrictions;
• Ageing infrastructure causing leaks and overflows;
• Network capacity issues, leading to stormwater flooding in heavy rainfall events.

Significant work is needed to address these constraints and support future development. Projects to upgrade infrastructure are included in the 2025-34 plan, such as replacing and upgrading water, wastewater and stormwater pipelines, and improving pumping stations and treatment plants.

2.4.1 Impact of the National Policy Statement on Urban Development and Dunedin Future Development Strategy

The strategic priorities for urban growth and development over the next 30 years are given in the Dunedin Future Development Strategy 2024 – 2054 (FDS). The strategy was adopted in April 2024. The FDS informs Dunedin’s 9 year plan 2025-34 and the ORC Long Term Plan 2024-2034 regarding Dunedin’s future growth.

The FDS guides future changes to RMA planning documents (such as Dunedin’s District Plan – the 2GP) and other planning decisions that affect the urban environment. It also influences infrastructure planning and funding decisions made by the DCC and ORC in their long term plans and infrastructure strategies, and the Regional Land Transport Plan. It includes policy guidance to help prioritise and plan investment in infrastructure. The FDS identifies three waters upgrades required to service existing development capacity, proposed future urban development areas, and outlying townships and settlements, based on these priorities. They include upgrades that reflect the aspirations and intent of iwi and outlying communities (although the timeframes to deliver these may be longer term).It also includes a clear statement of iwi and hapū values and aspiration for urban development.

Upgrades of infrastructure are required to service development that is provided for under existing District Plan rules.

• Consistent with the priority approach outlined in NPS -UD 2020 Policy 1 (Section 5), we are prioritising these upgrades to maintain or restore minimum levels of service and performance and provide for the development capacity that is enabled by current 2GP rules, considering also the pace and timing of growth.
• Dunedin is also required, at all times, to provide at least sufficient development capacity to meet expected demand for housing and for business land over the short, medium and long term under NPS-UD (Policy 2).

The FDS includes details of the current constraints on growth in the three waters network, and the upgrades required to address these constraints and support a well-functioning urban environment are documented as well as guidance on prioritising upgrades.

The costs to address the constraints in our network are significant, and all problems cannot be addressed immediately. We are prioritising upgrades required to service development that is provided for under existing plan rules and to maintain or restore minimum levels of service and performance.

Works to support expected growth are included in Dunedin’s 9 year plan 2025-34 and will be provided in years 1 to 9. This includes significant replacement of and upgrades to water, wastewater and stormwater pipes, new and upgraded pumping stations, and upgrades to the city’s wastewater and water treatment plants.

Further information about three waters upgrades to support the FDS can be found in sections 6.3.1.3 - 6.3.1.7 of the FDS document which is available on the DCC website: Future Development Strategy-2024-54.

2.4.2 Planned increases or decreases in levels of service

Levels of service describe the standards for management and maintenance of the water supply, wastewater and stormwater systems and are a requirement of the Local Government Act 2002. The DCC sets levels of service in consultation with its community as part of the long-term plan process. This provides transparency and confidence for the public and other stakeholders that the system can support lifestyle and business needs and is well managed. They consist of a service statement, measure, and target.

No changes are proposed to the DCC’s three waters levels of service in the 9 year plan 2025-34. The levels of service for three waters are based on the mandatory non-financial performance measures introduced by the Department of Internal Affairs in 2013 (as updated in 2024 to reflect changes in the drinking water regulatory system). New drinking water standards and drinking water quality assurance rules are already in place and administered within existing service levels.

Core service levels for three waters activities are: providing safe drinking water; reliability of supply; the adequate performance of networks; and the impacts of three waters discharges and overflows on the environment. These are measured by customer and technical performance measures.

There is limited funding in Dunedin’s 9 year plan 2025-34 for upgrades arising from any changes to regulatory standards. Future, unanticipated three waters reform could result in enhanced standards for the quality, quantity and management of drinking water, or require improvements in wastewater or stormwater management. We do not anticipate significant regulatory changes that would required enhanced standards at this time.

2.4.3 Building resilience to natural hazards

DCC has improved its understanding of natural hazards to assist in developing options for resilient infrastructure into the future. The DCC is working in partnership with other agencies such as GNS Science and ORC to further enhance our understanding of natural hazards including groundwater and impacts of sea level rise, particularly in South Dunedin.

The South Dunedin Future (SDF) programme began in 2021 as a response to issues in South Dunedin in partnership with the ORC. The programme involves long-term planning to adapt to the effects of climate change. Aligned with this, the DCC, through its system planning programme has been improving monitoring of flows in stormwater and wastewater networks and improving the accuracy of computer hydraulic models of wastewater and stormwater networks, as well as investigating improvements to stormwater pump stations. The DCC 3 Waters Group will integrate with the SDF programme in assessing and selecting adaptation pathways for South Dunedin and will be responsible for implementing those adaptation options involving three waters infrastructure.

System planning is contributing to building resilience to natural hazards. The programme takes an adaptive approach to investment, planning for natural hazards and ensuring resilient solutions are implemented. System planning outputs have been used to inform the 2025-34 9 year plan, and early work is planned to increase resilience to some water supplies and target metropolitan wastewater treatment plant wet weather flow management in the 2025 -2034 capital programme.

The DCC is an active participant in the Alpine fault quake resilience (AF8) programme. This is a scenario-based planning project, managed by the Ministry of Civil Defence and Emergency Management, with the intention of preparing plans to respond to a major earthquake on the Alpine Fault.

2.5 Delivering on our city and DCC emission reduction targets

In June 2019, the Council declared a climate emergency and adopted the ‘Zero Carbon 2030’ target, which seeks, at a city level, to reach net zero greenhouse gas emissions by 2030 (excluding biogenic methane), and reduce biogenic methane emissions in line with Government targets.

Net zero’ means greenhouse gases that we emit into the atmosphere (excluding biogenic methane) are in balance with the amount of carbon dioxide absorbed by forests. Biogenic methane is methane produced and released from living organisms like plants and animals. The city’s biogenic methane reduction targets are the same as the central government targets as follows:

• 10% reduction from 2017 levels by 2030.
• 24-47% reduction from 2017 levels by 2050.

Council also adopted targets for its own organisation’s activities gross emissions, as follows:

• By 2026/27, a 30% reduction in annual emissions from the 2018/19 baseline of 84,216 tCO2e.
• By 2030/31, a 42% reduction in annual emissions from the 2018/19 baseline of 84,216 tCO2e.

Council’s Zero Carbon Policy adopted in 2022 mandates that the DCC’s activities minimise emissions to help achieve both the city and Council emissions reduction targets. Our Zero Carbon Plan 2030, adopted in 2023, set out the pathway to Zero Carbon 2030 and identifies the city-wide outcomes, changes and the DCC’s actions required to bring about those changes. The Plan focuses on reducing gross emissions where possible, rather than relying on sequestration alone. This aligns with the Zero Carbon Policy, best practice for developed countries, and with what scientists suggest is necessary to avoid the worst impacts of climate change.

2.5.1 Why Dunedin’s infrastructure is important for Zero Carbon targets

Reducing emissions associated with infrastructure is necessary to achieve global climate goals. Infrastructure is associated with an estimated 79% of total greenhouse gas emissions worldwide. Most of these emissions are from energy, buildings, and transport, while water, waste management, and digital communications also contribute. Emissions occur at all stages of the infrastructure lifecycle, including from construction materials, transport of materials and workers, operation of the asset, and use of equipment for maintenance and decommissioning. The long life of infrastructure assets and the high costs of replacing or changing them can mean decisions made today result in emissions for years to come, and existing infrastructure and urban form can lock in long term behaviour and emission impacts for generations.

Three waters infrastructure impacts city-wide emissions in several ways. A significant impact is the availability of servicing in various parts of the city. This shapes urban form, which in turn impacts transport sector emissions.

Urban intensification (particularly around the CBD, urban centres and along public transport routes) supports and promotes low emission transport systems. The DCC’s overall urban form objective of a ‘compact city with resilient townships’ is intended to be achieved through consolidation and prioritising use of existing capacity within existing urban areas. Rules in the 2GP currently restrict development in some new medium density areas due to constraints in the three waters network, and the degree to which additional intensification is achievable is similarly limited in some locations by three waters network capacity.

Three waters infrastructure also directly generates emissions. An emissions baseline for existing plant and network operations has been established. Emissions sources are as follows:

• Biological processes from wastewater treatment were assessed as being responsible for approximately 0.8% of the city’s emissions in 2021
• Some sludge generated in wastewater treatment processes is currently sent to landfill, contributing to solid waste emissions
• Diesel, chemicals and energy used in distribution, treatment and disposal processes associated with three waters networks all contribute to stationary energy sector emissions
• Construction and maintenance processes associated with the three waters network also contribute to the city’s emissions profile.

Emissions have not always been a key consideration in the design of three waters plant and network infrastructure, meaning the existing plant and network configuration is not optimised to minimise emissions. The need to prioritise reactive operational expenditure, to address process challenges and compliance risks, hinders the significant investment needed to minimise emissions.

Biosolids management and disposal, as well as increases in treatment standards for water and wastewater, are likely to result in more intensive treatment processes and to drive increases in energy demand. It is currently unknown how much these requirements may hold up emissions reduction efforts, but this may be significant. However, system planning identified a range of opportunities to manage down emissions while also delivering on strategic goals.

2.5.2 The DCC’s work to reduce emissions associated with 3W infrastructure

Since the 2021-31 10 year plan was adopted, significant work has been undertaken to identify and prioritise opportunities for emissions reduction associated with wastewater emissions. The DCC has also developed policy and processes to ensure that emissions reduction is supported and prioritised as part of business-as-usual.

The Zero Carbon Policy 2022 will assist with reduction of emissions associated with three waters infrastructure projects, including renewals. It sets out key principles that guide the DCC’s emissions management and minimisation practices, including considering and minimising the city-wide emissions impact of a proposed asset/activity early in the project lifecycle, escalating the decision if a proposed activity/asset is identified as likely to increase city-wide emissions; preferring options that contribute most to city-wide emissions reduction targets, minimising whole-of-life emissions; minimising exposure to climate change risks: and clearly reporting emissions considerations in decision making. To give effect to the Zero Carbon Policy, the DCC is integrating emissions reduction considerations throughout its procurement and project management processes.

The Zero Carbon Plan 2030 (an emissions reduction plan for Dunedin) focuses on tools and initiatives proven to work in other cities or suggested through community engagement, because achieving the city’s targets means taking action now. Reducing emissions associated with three waters activity is also a key focus of the DCC’s Emissions Management and Reduction Plan 2023/24-2030/31 (EMRP). Many of the actions in both plans will reduce costs in the medium and longer term, but there will be upfront costs.

Both the Zero Carbon Plan 2030 and the EMRPemphasise reducing emissions from energy use associated with three waters infrastructure, and reducing wastewater processing emissions. A key focus over the next decade will be beneficial re-use of biosolids, which are the main component of DCC three waters-related carbon emissions. A planned upgrade of Green Island WWTP will also help reduce emissions from wastewater treatment processes within the decade. On the water supply side, targeted interventions include process optimisation to reduce chemical use, followed by lower emissions intensity energy sources associated with water supply. Planned water efficiency projects will also have flow on benefits for emissions reduction goals.

In the Zero Carbon Plan, there is an additional focus on supporting a compact urban form for Dunedin. Ensuring three waters infrastructure constraints are resolved for zoned medium density areas close to public transport and centres will assist with this objective.

Continuing to improve data quality for three waters is also necessary to support efforts to reduce emissions.

2.6 Living within our means - Financial prudence and affordability

Establishing an infrastructure strategy and funding programmes of works that are financially prudent and affordable to ratepayers is one of the most challenging aspects of our planning work. This requires managing risk around what is and is not prioritised, what can be reasonably expected to be funded and delivered while remaining affordable to the community, and continuing to deliver a sustainable level of asset management over short and long term planning timelines.

2.6.1 Financial Strategy

The Infrastructure Strategy is closely linked to the Financial Strategy. The Financial Strategy considers affordability for ratepayers and the DCC as a whole. The DCC has attempted to balance the competing tensions of affordability, maintaining assets and investing for the future, while addressing the financial challenges of increasing costs, delivering large capital projects and increasing piped network renewals. The Financial Strategy provides strategic financial limits for rates and debt and discusses other funding sources. The budgets increase rates and debt requirements, but do not exceed the limits over the next ten years. This guides decision making on Dunedin’s 9 year plan 2025-34 funding, establishes the funding envelope or ‘means’ that each DCC activity operates within and the funds available for capital expenditure programmes.

2.6.2 Debt

The use of debt allows the financial burden of new capital expenditure to be spread across a number of financial years, recognising that the expenditure is on intergenerational assets, i.e., the assets have a long life and generate benefits both now and to future generations.

Debt is also used to fund the portion of capital renewals that is not covered by funded depreciation. The gross debt limit for this 9 year plan is set as 250% of revenue. This means that our debt level will be responsive to change and will move in line with the level of our activities. This revised debt limit will allow flexibility to deliver the planned capital expenditure programme, while also having capacity to fund potential unplanned events.

This debt limit is considered financially prudent, as it sits within the lending limits set by the Local Government Funding Authority (LGFA). The LGFA equivalent metric is based on net debt, where net debt is defined as gross debt less liquid financial assets and investments.

2.6.3 Managing within our means

There is an acknowledged nationwide three waters infrastructure deficit in renewals expenditure and replacement of ageing infrastructure. For Dunedin, this deficit is currently estimated at $1,003M.[1] The DCC has developed renewals budgets to proactively and progressively reduce and remove the deficit in Dunedin’s three waters networks across the term of the infrastructure strategy.

The planned renewals expenditure over the life of Dunedin’s 9 year plan 2025-34 is $552.8M[1], and approximately $3.6² billion over the life of the 30 year plan.

DCC three waters assets have a gross replacement valueof $3.956 billion and a current depreciated replacement value of $1.58 billion (as at the 30 June 2024 annual report). Depreciation represents the using-up or consumption of our assets over their lifespan, and is offset by the value of our capital renewals work to replace assets as they reach the end of their service lives. Funding of renewals is stepped up in order to reduce the infrastructure deficit over the longer term. The deficit is shared proportionately between Water Supply 32%, Wastewater 44%, and Stormwater 24%.

Renewals as a percentage of cumulative depreciation across Dunedin’s 9 year plan 2025-34 are Water Supply 82%, Wastewater 95%, and Stormwater 52% indicating a high level of renewals expenditure planned for wastewater. This reflects the higher deficit and the direct risk to public health and the environment from failures in wastewater network pipelines and potential impacts on stormwater in extreme rainfall events. Projected three waters renewals expenditure aims to reduce the infrastructure deficit down to zero by the end of the 30-year horizon of the Infrastructure Strategy.

Where funding is not available in Dunedin’s 9 year plan 2025-34, the DCC will aim to manage risks within available budgets. This will be achieved through an increased focus on the monitoring of critical three waters assets and responding proactively to changes in condition and performance to ensure continued service delivery.

Monitoring and maintenance of older and poor-performing assets will be increased to keep them in serviceable condition for longer, and renewal capital will be targeted toward assets at highest risk of failure. While this approach will reduce the amount of capital expenditure required in the short term, it will lead to increasing operational expenses as repairs are undertaken on assets that would otherwise have been replaced. Additionally, if this approach is retained longer term, asset failures will increasingly begin to impact on service levels. Amendments will be made to the capital programme in this plan over its lifetime as new requirements become known and quantifiable, and capital projects are scoped to address any new deficiencies arising.

This strategy addresses the renewals backlog and seeks to balance asset risk in a pragmatic and affordable way. The planned 30 years phased approach means that there will be a modest reduction in the total backlog (approximately 4%), over the life of the 9 year plan 2025-34. However, our focus in the first nine years will be to prioritise renewals at highest risk such as at our treatment plants. Beyond the 9 year period, a reprioritisation in capital expenditure will be required to address the remaining backlog by the end of the 30-year horizon of this strategy.

Whilst the risk that critical assets may fail during the 9 year period may be high, we believe that this risk is mitigated as we have significantly increased our provision for repairs and maintenance over the term of the 9 year plan. We will also increase focus on the monitoring of critical assets and respond proactively to changes in condition and performance to ensure continued service delivery. This allows our focus to remain on planning for the renewal of critical assets before a deterioration in their condition materially impacts on service levels and the environment. Forward planning will also ensure that the capital needed to fund the work (both debt and rates), and the contractors required to do the work, are in place.

Footnote

1. Please note that the renewal capital expenditure amount corresponds to the allocation within the Council's capital expenditure programme, rather than the allocation outlined in the Funding Impact Statement.

Our service provision is generally strong, but there are significant areas needing improvement. Some assets are in poor condition, and in certain cases, we lack sufficient information about their status. Additionally, we face several performance challenges that must be addressed to ensure reliable and efficient services.

For instance, our water supply network, despite delivering high-quality drinking water, struggles with capacity issues due to ageing infrastructure, leading to water supply losses and difficulties in meeting demand during peak summer periods. Our wastewater systems, although functioning well in dry weather, perform poorly during wet weather, resulting in overflows and a large carbon footprint. Similarly, our stormwater systems often fail to meet capacity levels of service, with limited treatment and contaminant removal capabilities. These issues highlight the need for targeted interventions to enhance our infrastructure and service delivery, ensuring we meet both current and future demands effectively.

It is important to note that the funding allocated in Dunedin’s 9 year plan 2025-34 does not aim to renew all assets before they fail. Such an approach would be neither economically feasible nor practical. Instead, renewals are prioritised based on asset criticality, and failure rates. Allowing non-critical assets to fail before replacement is an approach that can improve affordability while adequately managing risk. Funding over the 30-year infrastructure strategy period is calibrated to meet these renewals and address historically deferred renewals, ensuring the DCC can maintain service levels in the future.

3.1 Water supply

The DCC provides high-quality drinking water that complies with Water Services (Drinking Water Standards for New Zealand) Regulations. However, ageing infrastructure in some areas reduces network capacity and fails to meet current requirements, such as minimum flows for firefighting, particularly in cast iron mains where tuberculation reduces flows. Urban growth and development, as planned in the FDS and enabled under District Plan provisions, are constrained by network capacity in some areas. Dunedin’s 9 year plan 2025-34 includes expenditure to address these constraints. Some smaller, rural plants require improvements to ensure resilience and reliable compliance with more rigorous regulatory standards. Most non-compliances with recently strengthened standards have been technical non-conformances, related to missed manual samples or outages in automated data collection systems. The DCC remains confident that the water supplied to consumers is safe to drink but recognises that further work required to consistently meet all compliance requirements.

3.1.1 Condition of Water Plant and Civil (Built) Assets)

Figure 1: Age-based condition of water supply plant and civil assets

Figure 2: Assessed condition of critical water assets, grouped by criticality rating (Minor/Moderate/Major/Extreme) and site

The charts above show the condition of water supply plant and civil (built) assets. The chart on the left (Figure 1) shows the assumed condition of these assets based on how far through their useful lives they are. For example, if an asset is 85% or more through its expected useful life, it is considered to be in poor or very poor condition. Currently 34% of water supply plant and civil assets, by replacement value, fall into this category.

The chart on the right (Figure 2) represents the condition assessed through direct observation, focusing on critical assets at critical sites only (critical assets being those assessed as being ‘moderately critical’ or above). The assessment indicates approximately 90% of these assets across the six water treatment sites are in fair to very good condition. Works are underway to replace the remaining 10% of critical assets in poor condition. Six highly critical raw water pump station assets are in poor or very poor condition, with half located at the Puddle Alley pump station, where works are programmed for 2025/26. Among treated water pump stations, several highly critical assets are in poor or very poor condition. Additionally, 75% of the critical pump station assets identified as being in poor condition have reached or exceeded their lifespan. Replacement works are either underway or planned, with budgets allocated for these projects in the 9 Year Plan 2025-34.

3.1.1 Condition of Water Network Assets

The average age of Dunedin’s water pipelines is 49 years, with an average total expected useful life of around 80 years depending on the pipe material and diameter. Older pipes are more prone to leakage, loss of fire flow capacity, and aesthetic water quality issues, such as discolouration, sedimentation, and odour complaints due to higher chlorination levels needed to address biological build-ups, particularly in cast iron mains.

Water pipe conditions are assessed by removing small sections of pipe for inspection. CCTV filming is not commonly used because it requires taking the assets out of service. Data on material, age, condition, performance, location, capacity, criticality and remaining useful life is collected for three waters assets. DCC staff routinely inspect treatment plant assets to ensure proper maintenance, with specialist engineering advice used as needed. The following map (Figure 3) indicates the current state of water supply reticulation infrastructure.

Figure 3: Water Supply network condition by age

Figure 3 shows water supply network (reticulation) assets by age. Red indicates our oldest water main assets which are beyond 85% of their expected lifespan. These are generally in the older parts of our city that received reticulated services first. 29% of our water mains are classified as being in poor to very poor condition. Much of our work programme focuses on renewing these older pipes to ensure continued reliable service. Work programmes prioritise assets in poorest condition, with renewal priority based on age and break history.

Figure 4 shows the number of water main breaks per month as a 12-month rolling average. The trend indicates an increase in breaks over time (as shown by the dotted line) which is expected where renewals have lagged behind depreciation over time.

Figure 4: Number of water main breaks (12 month rolling average)

3.2 Wastewater

The performance of Dunedin’s wastewater systems varies with age. Our wastewater systems generally operate as designed during dry weather, safely transporting, treating and discharging treated wastewater. However issues arise during wet weather, with severity increasing with rainfall. While most of the city’s wastewater treatment plants are in reasonable condition, many mechanical and electrical components are reaching the end of their useful life, affecting operational performance and staff safety. Some plants face challenges meeting current consent conditions, resulting in non-compliance or abatement notices. Several areas of the wastewater network are in poor condition due to ageing pipes, leading to stormwater and groundwater infiltration. During heavy rainfall, this can cause wastewater overflows and insufficient treatment before discharge as treatment processes are overwhelmed. These issues constrain urban development in some parts of the city, with improvements needed to support development.

Wastewater treatment, including energy-intensive processes, biosolids production and biogenic methane, is the DCC’s largest carbon emitter. Significant work, including developing a dedicated bioresources handling facility is planned (see section 4 ‘Our Plan’).

Currently, CCTV inspections are completed in response to reported issues or when an asset is due for renewal. This approach skews the data toward assets in poor condition, making it an unreliable indicator of overall network condition. Network performance is a more reliable indicator.

With an average age 62 years, ageing wastewater pipes are causing varying issues for residents, particularly in older areas like Kaikorai Valley, North East Valley and South Dunedin. Renewals are underway in North East Valley and Kaikorai Valley. Renewals in South Dunedin have not commenced due to the complex interactions between groundwater, stormwater and wastewater. There is some evidence to suggest that South Dunedin’s ageing wastewater infrastructure acts as a series of field drains, artificially lowering groundwater levels. The South Dunedin Futures project has examined these interactions and will guide renewals in both wastewater and stormwater networks to improve services without adversely impacting properties.

Inflow occurs when stormwater enters the wastewater network through direct connections like manhole covers, while infiltration refers to groundwater seeping in through cracks or joints in the pipes. Excessive inflow and infiltration can overwhelm the system during heavy rainfall, leading to overflows and increased treatment costs. Larger issues arise from inflow and infiltration of ground and surface water into older pipes, leading to surcharges, where network flows exceed capacity, creating pressure at access holes and flooding treatment plants.

Renewal programmes focus on reducing inflow and infiltration to minimise wet weather overflows and treatment plant washouts, which reduce treatment capacity and can lead to consent breaches. At pump stations, the aim is to increase reliability to maintain network performance, while renewals at treatment plant focus on compliance with resource consents and reducing health and safety risks.

3.2.1 Condition of Wastewater Plant and Civil (Built) Assets

Figure 5: Age-based condition of wastewater plant and civil assets

Figure 6: Assessed condition of metropolitan wastewater treatment plant assets, grouped by criticality rating (Minor/Moderate/Major/Extreme) and site

The charts above show the condition of wastewater plant and civil (built) assets. The chart on the left (Figure 5) shows the assumed condition of these assets based on age. Currently, 29% of wastewater plant and civil assets, by replacement value, are considered to be in poor or very poor condition due to their age.

The chart on the right (Figure 6) represents the condition of metropolitan treatment plant assets, as assessed through direct observation. The assessment indicates that approximately 82% of assets across the treatment sites are in fair to very good condition. Treatment assets at rural plants (not shown here) are generally in reasonable operating condition, with the exception of the Middlemarch WWTP which is programmed for upgrade in the short term, and Seacliff which has recently been refurbished. Wastewater pump station assets are routinely inspected as part of normal operations. The condition of pumps is assessed during programmed plant maintenance inspections, however formal condition grades are not assigned during this inspection. Works are underway or planned to replace assets in poor condition.

3.2.2 Condition of Wastewater Network Assets

Figure 7 Wastewater network condition by age

Figure 7 above shows wastewater network (reticulation) assets by age. Assets marked in red are the oldest, having exceeded 85% of their expected lifespan. As with water, these older assets are typically located in the older parts of our city. 30%of our wastewater mains are classified as being in poor to very poor condition. Our work programme primarily targets the renewal of these ageing pipes to maintain reliable service. We prioritize assets in the poorest condition, with renewal decisions based on age and break history.

The figure below shows the number of blockages per month as a rolling 12-month average. The dotted line indicates a decreasing trend in monthly blockages and breaks, reflecting the DCC’s efforts to reduce wastewater overflows by focusing on areas with older infrastructure susceptible to inflow and infiltration.

Figure 8: Number of wastewater blockages (12 month rolling average)

3.3 Stormwater

Stormwater services in the city are provided by the DCC, Otago Regional Council (ORC) and private landowners through open and piped watercourses and infrastructure. During heavy or prolonged rainfall, the drainage network in some areas underperforms, causing surface flooding and property damage. Peak stormwater flows are increasing due to climate change, which makes rainfall more intense and raising ground water levels in some areas.

Many areas experiencing capacity issues have seen significant change in use or density, or upstream development since the networks were first installed. Differing service levels design parameters for neighbouring borough councils prior to 1980s amalgamations also contribute to the issues. As a result, and acknowledging that development increases impervious surfaces and affects flow paths, the DCC now requires properties with significant development impacts on stormwater to undertake an assessment. This may require a stormwater management plan to ensure that post-development flows do not exceed pre-development levels. This approach allows for growth while ensuring it does not negatively affect the existing stormwater service level. Unreported development on private property, such as additional decking, paths, or sheds increases impervious surfaces and can cumulatively reduce the network’s ability to meet service levels.

Issues also arise when private watercourses are not maintained or when private pipes are too small to safely convey flows. The integrated system plan includes an assessment of the quantity and criticality of private stormwater assets (e.g., watercourses) interacting with the DCC’s network.

The average age of stormwater pipes owned by the DCC is 65 years. With little to no information on the nature of privately owned infrastructure it is impossible to determine how old these assets are, but they are likely to be similar, or older than surrounding structures.

The current provision of stormwater services is below target levels in some areas of the city. Climate change is intensifying rainfall, further exacerbating this issue, and in some areas, shallow groundwater limits soil storage capacity. These factors will make it more difficult to meet desired stormwater service levels in the future, requiring additional investment stormwater infrastructure to maintain existing service levels. To support this, DCC is focusing on renewing assets and initiating new projects to address current service level issues. Following previous floods, improvements are planned for the most heavily affected areas such as South Dunedin and Mosgiel. Work programmes to support planning are in place, such as the development of flood hazard assessment models for urban areas of Dunedin, new stormwater models for North East Valley and Kaikorai Valley, and improvement to the accuracy of stormwater hydraulic models in South Dunedin for planning and operational purposes.

Current service provision includes little infrastructure to improve stormwater quality before discharge or prevent contaminants from entering the stormwater system. Future regulatory changes are expected to require increased levels of stormwater treatment to protect receiving environments. Contaminants can enter stormwater from multiple sources including roadways and footpaths, roofs, and cross-connections. Most sources of contamination are outside the control of the DCC and will require treatment, but some sources, such as cross connections, can be identified and addressed either through capital works, or enforcement actions.

3.3.1 Condition of Stormwater Plant and Civil (Built) Assets

Figure 9: Age-based condition of stormwater plant and civil assets

Figure 9 shows the assumed condition of stormwater plant and civil (built) assets based on age. Currently, 78% of our stormwater assets, measured by replacement cost, are in very poor condition. Three-quarters of these assets by value are concentrated at the main Portobello Road pump station. Modifications and upgrades to this pump station will be considered as part of the South Dunedin flood alleviation programme, pending the outcomes of the South Dunedin Futures (SDF) project. A further 12% of the remaining assets in very poor condition are located at the Reid Avenue stormwater pump station, which is programmed for upgrade in the early years of the programme. Stormwater pump station assets are routinely inspected as part of normal operations. The condition of pumps is assessed during programmed plant maintenance inspections, however formal condition grades are not assigned during this inspection.

3.2.2 Condition of Stormwater Network Assets

Figure 10: Stormwater network condition by age

Figure 10 shows stormwater network (reticulation) assets by age. Assets marked in red are the oldest, having exceeded 85% of their expected lifespan. As for water and wastewater, these older assets are typically located in the older parts of our city. 61% of our stormwater mains are classified as being in excellent to average condition (less than 85% through their lifespan). Our work programme primarily targets the renewal of these ageing pipes to maintain reliable service.

4.1 The plan to address Dunedin’s three waters infrastructure challenges over the next 30 years

Significant work is required to enlarge and expand Dunedin’s existing three waters infrastructure to meet the expected changes in population growth and housing demand. Renewals programmes and specific projects are also needed to address risks to health and safety, public health, levels of service and the environment, and to respond to new regulatory requirements.

The DCC will manage the response to changes in demand for infrastructure by planning and investing for a high growth scenario over 2025-34, and a medium growth scenario from 2035 to 2055. The 2025-34 capital programme is funded to investigate, design and construct new infrastructure required to service the housing capacity enabled by the 2GP and some of the desired growth signalled in the FDS. The delivery of new infrastructure to support this housing capacity will be undertaken within the first 10 years of the programme and will be prioritised based on demand in different areas. Areas with a lower demand for infrastructure and those future areas identified by the FDS as being required beyond the next 10 years will be delivered over a longer period.

In the short term, renewals are required at water treatment plants to ensure they continue to meet the Water Services (Drinking Water Standards for New Zealand) Regulations 2022. Work will also commence on improving the efficiency of our water use through initiatives such as demand and pressure management that will aim to reduce water losses. Major renewals within the wastewater network and treatment plants are needed to ensure discharges will remain compliant and to provide a safe working environment for operational and maintenance staff. As resource consents for discharge of wastewater expire, investigations into the capacity of infrastructure, a focus on environmental outcomes and working in partnership with Iwi will allow the best practicable options for new resource consents to be achieved.The DCC will invest in flood alleviation measures in South Dunedin and Mosgiel, increase water supply resilience for Mosgiel and Port Chalmers, carry out resilience focused upgrades at water treatment plants and pump stations and improve wet weather flow management of the wastewater networks.

In the medium term, water treatment plants will be upgraded as budgets allow to meet anticipated ongoing improvements in drinking water standards. Major renewals of water supply pipelines from Deep Stream and Deep Creek will also be undertaken to improve drinking water system resilience. Our system planning work has identified that new water sources will be required within the latter stages of this Infrastructure Strategy, as well as substantial raw water storage, to ensure that minimum flows in existing rivers can be maintained and Dunedin has sufficient water available in dry periods. There will be increased use of green infrastructure for managing stormwater, improving flood resilience and stormwater quality. This will benefit the health of freshwater and coastal waters and provides an opportunity to create more greenspaces for Dunedin residents to enjoy.

Within the timeframe of this Infrastructure Strategy, most DCC three waters-related buildings and structures will require significant upgrades or replacement to ensure service levels are maintained. Further changes to three waters infrastructure may also be required depending on demographic changes within the city to support proposed areas of future housing intensification and new business land identified in the FDS.

To support the Council’s Zero Carbon 2030 target, projects will aim to minimise carbon emissions in the design, construction and operational phases. Integration of land use, infrastructure and transport system planning will be essential to achieving Zero Carbon goals.

The DCC will continue to invest in relationships with professional and local government bodies such as Water New Zealand, Local Government New Zealand, Taituarā (Society of Local Government Managers), Institute of Public Works Engineering Australasia, and central government to avoid duplication of effort and identify approaches used by other groups that can be applied in a local context.

Table 5: Responding to infrastructure challenges - principal options and implications

4.2 Delivering on our Strategy

To address the significant challenges facing Dunedin’s water supply, wastewater and stormwater activities, we have developed a comprehensive 30-year programme totalling $4.729B. This ambitious plan includes a series of projects to enhance the delivery of three waters services, ensuring that Dunedin continues to thrive as one of the world’s great small cities.

Our 30-year programme is strategically aligned with the goals of the Future Development Strategy (FDS), the 3 Waters Strategic Direction Statement and the Financial Strategy. We are committed to upholding the principles of Te Tiriti o Waitangi, ensuring that our initiatives respect and incorporate the values and rights of Māori communities.

Key focus areas of our programme include:

• Looking after our people and places, through projects that support public health and environmental outcomes
• Looking after what we have, by replacing and renewing our ageing infrastructure
• Meeting our changing needs, through projects that address changes in population, regulation and standards, and customer expectations
• Providing for infrastructure resilience, to ensure our assets can withstand and respond to extreme events
• Delivering on our city and DCC emissions reduction targets by reducing our own emissions, and supporting urban intensification to reduce City emissions
• Living within our means, making financially prudent choices that are affordable for our community.

4.3 Three Waters Projects

Table 6 describes key projects in our 30-year programme that support service delivery across all three waters activities. Tables 7, 8 and 9 describe specific projects supporting water supply, wastewater and stormwater activities.

Table 6: Key projects supporting service delivery across all three waters activities

4.3.1 Water Supply Projects

Table 7: Key projects supporting water supply service delivery

4.3.2 Wastewater Projects

Table 8: Key projects supporting wastewater service delivery

4.3.3 Stormwater Projects

Table 9: Key projects supporting stormwater service delivery

4.4 Key decisions

Table 10: Key DCC decisions or opportunities for public engagement affecting three waters activities:

Significant projects and decisions over the next 30 years

Figure 11 shows the estimated timing of significant three waters capital expenditure projects and key decisions.

Figure 11: Estimated timeline of significant three waters capital projects and key decisions (* indicates DCC decision or opportunity for public feedback)

Estimated timeline significant three waters capital projects - enlarge to full image

In developing the Infrastructure Strategy 2025-55, trade-offs have been made due to affordability pressures and market capacity. Renewals investment prioritises the most critical and high-risk areas. Our strategic system planning project has informed the prioritisation of the capital expenditure programme. Over the 30 years to 2055, most three waters-related buildings and structures will require replacement or significant upgrades to maintain service levels. Climate change impacts in South Dunedin and SDF adaptation planning will continue to shape the three waters capital expenditure programme in the medium  to long term.

The first five years of Dunedin’s 9 year plan 2025-34 prioritises areas of highest risk and activities most in need of investment, with a continued focus on pipework renewals and large-scale plant renewals, such as the renewal of the city’s main central interceptor sewer and terminal wastewater pump station. New capital investment in the 10 years to 2039 aims to improve water supply resilience by investigating and developing new groundwater supplies, improving water use efficiency, and upgrading wastewater and stormwater networks. This includes improvements in wet weather flow management and projects to reduce carbon emissions from biosolids and create bioresources. Rationalisation of wastewater treatment plants in the north of the city and Mosgiel will reduce ongoing maintenance costs, enhance plant efficiency, and streamline operational processes.

Further improvements to the resilience of the water supply are programmed from 2034 onwards, including the construction of an additional raw water storage dam, and building new treated water reservoirs. The replacement of the Deep Creek and Deep Stream raw water pipelines (including replacing the Taieri River pipe bridge) is planned for the medium term, with condition assessment underway in early 2025 to inform timing. The replacement of these two pipelines is particularly significant as both carry significant risk in terms of the DCC’s ability to supply water. Failure to address these assets in this timeframe would expose the assets to an increasing risk of failure, denying the city of its two primary water sources. Resilience to natural hazards and climate change will be supported by raising critical wastewater assets, sealing manholes against infiltration, and improving stormwater network resilience and efficiency with green infrastructure and catchment upgrades. Ongoing renewals and minor upgrades to larger treatment plants will continue over the medium term. Significant investment is required to support city growth, mainly within the networks. While most treatment plants can handle forecast population changes, some smaller plants will need upsizing.

Over the longer term, efforts will continue to reduce network water losses, reducing the volume of raw water required from sources and the volume of water requiring treatment. Additional protection for the Tahuna and Green Island WWTPs from sea level rise impacts will be required, as well as protection or relocation of other critical wastewater network assets such as pump stations in coastal hazard zones. These facilities will also need ongoing upgrades to align with changing legislation and standards. Stormwater systems will be upgraded over the longer term using a ‘green infrastructure’ approach, using place-based solutions such as daylighting streams (uncovering buried waterways) and retrofitting of treatment devices such as wetlands and detention ponds. These approaches support resilience in the face of a changing climate, providing more space for water as heavy rainfall events become more common.

We will continue to monitor key variables such as population forecasts, sea level rise, legislative changes, and asset performance to ensure the strategy adapts to meet current and future challenges. Our Dynamic Adaptive Planning Pathway (DAPP) approach will guide our investments, allowing us to adjust plans based on emerging signals and changing conditions, ensuring our infrastructure remains resilient and effective.

5.1 Three waters budget 2025-2034

Figure 12: Three waters capital expenditure by type 2025-34

Three waters capital expenditure by type 2025-34 - enlarge to full image

Table 11: Three waters capital and operating expenditure budget

5.2 Three waters 30 year budget

Figure 13: Projected three waters capital renewal and operating expenditure in 5 year bands for the 11 to 30 year period.

Figure 13: Projected three waters capital renewal and operating expenditure in 5 year bands for the 11 to 30 year period.

Table 12: Three waters capital renewal and operating expenditure budget, five year bands for the 11 to 30 year period