EVALUATION COMPLETE
Paradise Dam does not currently meet Queensland legislative safety requirements and technical investigations found the existing wall could not be repaired to meet dam safety requirements, based on both the probability and consequence of dam failure.
Strategic Fit
The proposal’s water supply service need is aligned to strategies covering the supply of water in the region and for agriculture, including the Bundaberg Regional Water Supply Security Assessment, the Bundaberg and Burnett Regional Water Assessment, Agricultural Competitiveness White Paper and Ag2030.
However, the proposal does not closely align with the:
- National Water Grid Fund Investment Framework, which requires that eligible projects must deliver demonstrable public benefits, and the investment should provide the highest net benefit of all options available.
- National Water Initiative Pricing Principles, in which all Australian governments committed to economically efficient and sustainable use of water resources and water infrastructure.
The base case probability of dam failure during extreme flood events is 1 in 5,000 AEP. The preferred option is expected to reduce the probability to below the limit of tolerability, indicating a significant reduction in risk. Despite this, the present economic value of increased dam safety benefits is estimated at only $11 million. This outcome is significantly lower than the benefits that would be expected given the scale of costs, and is only partially explained by the impact of discount rates over the 50 year appraisal period.
Deliverability
This is a very large and complex capital project, and few major dam projects have occurred in Australia over recent history. The issues with Paradise Dam from which this project has emerged also indicates complexity.
Infrastructure Australia recognises the upgrade at Paradise Dam is needed to ensure compliance with Queensland Government dam safety regulations. The project would also restore water capacity to the level of the original dam.
To minimise costs and improve certainty that benefits will be realised, we recommend:
- considering the value engineering opportunities identified in the Concept Design Cost & Risk Peer Review to realise cost savings
- undertaking additional analysis of market drivers to improve demand certainty and benefits realisation
- further analysis of securing capital cost funding from beneficiaries, such as user contributions, to ensure sufficient revenue for delivery and promote sustainable water use.
