Dunedin City Council says implementing a new system of smart water meters that connect to a Spark IoT ("Internet of Things") network, "will help deliver to the objectives of Three Waters policy in making Dunedin a sustainable and resilient city".
The two parties put the project cost at $7.8 million.
"The forecasted net benefits per annum are approximately $800,000 per year after operating costs," a DCC spokesperson said.
If all keeps going to plan, it will be a win for local on-the-ground monitoring (and Spark says it's in talks with other councils, too).
But it comes at a time when officials are warning that the cost of linking councils' IT systems for Three Waters could run to $500 million (more on which below),
Dunedin City Council's group manager Three Waters, David Ward, says, "While the meters should also save money on the city's ratepayer bill, which can be funnelled into other programmes of work, this rollout is ultimately about achieving the environmental benefits, water savings, and the vision of Dunedin being one of the world's great small cities."
The deployment of the new system has been made possible by Spark's rollout of a new kind of IoT network, called NB-IoT, which has been added to 60 per cent of the telco's cell towers, giving the IoT technology 80 per cent population coverage.
Ward says while the old system had "routine inaccuracies ... With the new smart metering solution, we now have accurate real-time data across all non-residential properties which provides a detailed overview of their water use by the minute. Faults and leaks are more easily identified and fixed, leading to cost and water savings across the board, and property owners are empowered to manage their water consumption via a service portal solution that visually displays their water usage."
The University of Otago and Port Otago are using the new smart meters. The university has 200 water meters, the highest number of meters in Dunedin, and Port Otago is the largest user of water in Dunedin and has six meters. One of the Port meters has been collecting data since April 2021 and has already flagged three leaks.
In May, Dunedin City council said it would boost its Three Waters operational spending by $8.8 million over two years to employ about 15 more people to prepare for stricter water regulations, as well as fostering a smooth transition if the network is taken over by a new entity in 2024, according to an ODT report.
The council's estimated Three Waters debt was $120 million. It anticipated receiving about $46m from the $500m "Wellbeing fund" that forms part of the Government's $2.5 billion in Three Waters funding.
Cost of merging systems could be $500m or more
The larger Three Waters IT picture remains contentious, and with a number of key details yet to be filled in.
The reforms include a new project to merge local bodies' water service IT systems by July 1, 2024, when four new centralised entities will take over drinking, waste and stormwater service management from 67 councils.
Last month, Department of Internal Affairs chief executive Paul James told a select committee his department was in "commercial conversations" aiming for the "high tens of millions" on the low end. But his officials said utility projects of this type and size typically cost in the range of between $300m and $500m.
"You have to tie it to questions of scope," James said. "So what's needed for day one and then once you move past that?"
It was still too early to be clear about where the cost would likely land, he said.
Local Government Minister Nanaia Mahuta said, "It is a lot of money and that's why we're doing the business case ... the business case would give us a sound basis for landing on a number. We're just not there yet."
The business case would be informed by examples like Auckland's Watercare.
"We're taking our time to ensure that the business case and the assessment is being achieved to give us the best information about how to do that - how to consolidate the necessary architecture for the four of the water service entities," Mahuta said.
"There'll be a progressive spend over the period of time that we're designing the feature."
National's local government spokesman Simon Watts said costs could balloon beyond officials' upper-end estimate of $500m.
"There is significant downside risk in regards to these IT costs blowing out further - if the range is what it is at the moment ... it's not inconceivable to think that 12 months down the track that those numbers could be larger and that again is a significant concern."
Watts said the mere fact the project was still at such an early stage was a "significant red flag".
On Tuesday, the Government announced a $44m assistance package for the 67 councils. It came on top of the $2.5 billion already ear-marked to fund Three Waters.
With reporting by RNZ.