Friday, June 02, 2006

Which tank and how much will it cost?

The optimum tank for your situation depends on your average use, your roof area, your rainfall, your catchment efficiency, your storage capacity, your overflows and your shortfalls. We compiled a series of spreadsheets to make sense of it all and discovered that investing in the right storage capacity is one of the lowest risk, highest return investments you can make.

The average household uses 700 litres a day or 255 kilolitres a year at a cost of 94 cents/kL or $240 a year. If that money was used to pay off a mortgage at 7% interest over the 25 year tank life then a bank would give you 11.65 times the annual payment. But in this case you are not investing for an additional benefit but simply replacing an existing outlay. Capturing your own expense is one of the lowest risk investments you can make. So it is more appropriate to use the official cash rate of 5% which also matches the average yield of a rental house. And this would set the capital value of your $240 water bill at 14.09 times, or $3,380. Spend more and your tank water will cost more than council water.

That is, until the next price increase. Projected to be 6% a year, they will double in 12 years from $0.94/kL to $1.90/kL and this differential will improve the rate of return on your investment accordingly. But even without these savings, the largest 27,000L polytank will give you $300 change from your $3380 break even point. But this is serious overkill for a house connected to mains water.

The average roof is 250m2 and each millimeter of rain makes a litre of water on each square metre of roof. And all of it can go into the tank. Your existing supplier, on the other hand, has trees and pasture in their catchment so only 5% of their rain will flow into their dam. And their storage has no roof so half of that will evaporate to give a net efficiency of 2.5% compared to your 100%.

Without recycling, the average Brisbane household needs only 1020mm of rain (89% of average) to supply all of their water needs. The spread of both rainfall and water use enables smaller tanks to be refilled many times whereas the public water system relies on one big storage that is only filled every five years. And this is a major contributor to public water inefficiency. The annual cost of your tank is covered by many times it’s own storage capacity.

All other factors being equal, the smaller the storage, the more times it will be filled and the lower the apparent cost of a captured tank full. But don’t go out and buy the littlest tank available. The smaller the tank, the sooner it will over flow. A 1000 litre tank costing $430, connected to 250m2 of roof will overflow after only 4mm of rain so most of those valuable summer storms would be wasted. The tank may fill up 264 times but the projected cost of only 12 cents/kL would be illusory because only a small portion of it would actually come out of the tap.

A 22,000 litre tank costing $2,700 would need 88mm to fill and it would lose much less to overflow. It would only fill 12 times a year to produce a projected cost of 72 cents/kL. But even this size will still lose 1.5 tanks to overflow in an average year and will need a 1.12 tank top up from the mains in a dry season. And obviously, the supply of your own water will drop in a bad year and the cost of the tank will be spread over fewer full tanks. In a year with only 81% of average rain (857mm) the average cost of water, including the additional purchases from the mains, will rise to 89 cents/kL.

In an above average year like the past 12 months with 1245mm of rain, the overflow will be greater but the amount drawn from the mains will be lower and the average cost will fall to only 82 cent/kL.

The optimum mix of limited mains extraction in dry times and limited overflow in wet seasons was a 13,500 litre tank costing $2,050. This would need additional outlay on foundations and plumbing but this would be covered by the $850 worth of council rebates. It would deliver an average water cost of 69 cents/kL in a normal year and 74cents/kL in a dry year. And only 13% of total household use would be drawn from the Dams, enabling them to perform their proper role as a supply of last resort to an urban community that has taken all reasonable steps to help itself before putting it's hand out for a public service.

Spreadsheets for modelling water needs and costs are available on request from;

Ian Mott. talbank@bigpond.com.au

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