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Regulations Applicable To Vdp Project

Discuss about the Victorian Desalination Plant Project.

In the South Gippsland beside Wonthaggi, The Victorian Desalination Plant (VDP) was built up by Aquasure consortium. It is a public-private partnership between Aquasure and Victorian Government. The main scope behind this desalination plant was to provide with water pipeline for transferring water to the Melbourne regions and create a water network along with subversive power supply near Cardinia. Thiess Degremont Joint Venture made a contract with Aquasure for constructing and designing the venture while TDJV is supposed to maintain and operate VDP.  Initially the project was referred as Environmental Effect Statement in environmental management framework but gradually it was developed and included with contractual requirements for both Maintenance and Operation (O&M) and Construction and Design (D&C) teams of the project (VICTORIAN DESALINATION PROJECT , 2010).

According to the  environment management agenda, the project needs to be planned and constructed according to the requirements laid in Environmental Performance document which is included in Project deed (Appendix S3) (SUEZ Australia and New Zealand, n.d.). Also the Victorian environmental legal needs and commonwealth requires to be fulfilled in order to support environmental performance requirements. One of the major objectives for both constructing and operating teams was to manage the venture without hampering environmental conditions of the regions. In order to meet water requirements in future, the Australian Government announced to initiate Reverse Osmosis (RO) desalination plant in the year 2007 to provide drinking water from seawater. According to the plan, Melbourne would get sufficient water supply along with providing a set up of rainfall independent water supply system (Aquasure, 2017).

Environment Effects Act 1978 (Ees Act)

In the year 2007, the planning Minister decided that VDP’s environmental effects shall be documented under EE Act which was prepared in response to the Scoping Requirements issued by the Ministers in 2008 (Madden, 2009). The EES estimated that 15000 workers in construction site along with 26000 workers in manufacturing unit were working for the site. It was found that many workers working there did not belonged to the local areas and thus the economic development in Gippsland area was decreasing. Under the EES Act, the facilitation of neighbouring industries was the main factor to determine the economic benefits in the local region along with providing them with employment and regional income. The economic growth is also possible if VDP is able to supply high voltage power to Gippsland and Bass Coast areas. Uncertain impact of marine structures in VDP region would be minor as compared to the social and economic benefits of project. Regional tourism is also supported as under EES Act, environmental violation is prohibited which states that impact on regional tourism becomes minor.

The Environment Protection Act 1970 (Ep Act)

Contract Used For Vdp Project

This act established various principles that are directly or indirectly related to the  management of waste from desalination plants and its generation. PIW is the stream in which wastes from VDP flows and under EPA, it needs to be disposed to landfills under state license. According to the waste, it will be categorised and sent to landfills those are capable and possesses capacity to hold it.  According to a survey, the VDP had concluded that they cannot minimise more wastage as it would then hamper the quality of water (Langdon, 2010). With the imposition of EPS, the waste minimisation and its management have effectively become dynamic and reusing possible resources is initiated. Disposing of pre treated wastes to landfills rather than oceans shall be adopted to make RO desalination process more consistent (David, 2013).


The Renewable Energy Act 2006

According to Victorian Renewable Energy Target system, it requires electricity buyers to obtain a specified percentage of electricity from its renewable sources. The basic purpose of this act is to encourage investment for generating renewable energy. Protecting environment under EP Act requires commercial users of water and energy to implement and prepare Resource Efficiency plans to improve and utilise the available resources efficiently. Carbon Pollution Reduction Scheme introduced by Australian government would replace MRET and other carbon polluting markets by permitting them an estimated level of emissions. Although it had not been confirmed that the same will apply to VDP also, but the effects of it can be seen in the project. Therefore under this act VDP will be entailed to minimise GHG emissions and would not only provide safe drinking water but also environment friendly atmosphere (Willingham, 2017).

Catchment And Land Protection Act 1994 (Cmas)

Beneficial uses and protection of ground water is provided by SEPP (WoV) under the statuary framework of policies whereas to manage water health, special law was introduced namely Catchment and Land Protection Act which was responsible for maintaining water hygiene under their authority. According to this act the regions in Westernport, Port Philip along with West Gippsland are regulated under a framework in which strategies related to river health is monitored. Under the Water Act 1989, CMAs have the authority whether to permit or not in the designated water supply regions. Thus with the help of CMAs, the Powlett river’s water will not get violated or have bad impact on flood system (WEST GIPPSLAND CATCHMENT MANAGEMENT AUTHORITY, 2015). The pipeline system of water supply will become predictable and thus avoid hampering vegetation and reduction in marine ecological assets.

Flora And Fauna Guarantee Act 1988 (Ffg Act)

The basic reason behind introducing FFG Act is to promote conservation of flora and fauna in natives of Victorian region. It helps to manage processing those which prove to be threatening to the genetic diversity of environment. The chief goals of FFG Act state that it is mandatory to maintain the ecological communities by commercial centres (LGPro, 2017). Nearby range of species in bioregion along with prevention of declination in ratio of rare species or rare ecological community is also looked after under this act. All the native vegetation is protected under Victorian NVMF stated under the chief document in government policy. Preservation of Flora and Fauna  under EPBC Act in which VDP focuses on implication under section 18 and 18A to prevent threatened community and species. If any loss of inhabitant takes place in the local provenance of plant, it will be compensated by local EVCs. Therefore, it can be said that due to FFG Act and EPBC Act, any significant effect is avoided at least to those which are listed under Flora and Fauna Act.

The Victorian Government gave the contract to Aquasure consortium in the year 2009 which consisted of Degremont Macquairie capital and Thiess. They were responsible for designing, financing and build the project along with operating and maintaining the desalination project for the next thirty years. A contract of $43 million was given to OLEX for supplying alternative high voltage current. Later in the year 2012 the plant was able to achieve full capacity after passing RTF tests (Kable Inteligence Report, 2018). Another subcontract of $6 million was given to Ausform for building water retaining systems. Along with these many other contracts were made by this public private partnership firm in order to complete the project within the given deadline along with meeting the legislations made by the government. Both construction and the operational teams are managed by the Environmental Management Plans that requires the project to be fulfilled after compiling all the rules and regulations (e Victorian Government Department of Environment, Land, Water and Planning, 2015). Aquasure deed with Victorian Government is been approved for construction and maintenance phase for a limited time period.

PPP can be defined as a contract in which government and private sector combines to provide public service or infrastructure.  Although this is most appropriate for huge projects, the risks involved with such contracts cannot remain unseen. As an organisational structure it is very important to abide by contract rules and regulations in order to minimise risks and difficulties. Any issue in politics or home country or corruption creates disinterest among pubic and thus such firms are always vulnerable to nation’s political control. During the development stage, such projects can face difficulties due to geological condition or the government control over sites due to community infringement laws (Bing Li, n.d.). The duration of completion in projects can also determine the risks involved as longer the construction phase is, lesser the profits earned during the earning stage will be reduced by private sectors. As VDP was contracted for period of 30 years, the private firm partner may lose its profit sharing years if the construction phase is extended which shows monetary risk involved. Balancing commercial realities and governmental policy is again tough as regulation and excessive governmental control may hamper the quality of finished product. Most important risks involved in infrastructure projects are faced if any geotechnical surveyor or contractor claims increase in contract price or provide with bad quality of work. Since VDP is protected under various environmental laws, it can sometime become difficult to maintain a balance between environment and required condition. ‘Permitting risks’ is another important risk involved in which the contracting teams require getting permission from the government regarding every change in management system and construction process. As government requires taking time for passing bills through different stage or area, many times the process becomes slow and lengthy. Finally the appropriation risks are involved when the public agency fails to meet financial requirement for the project. This risk can affect the project where public agency is bound to make payments for assessing public private partnerships. Risk involved by political issue or change in country GDP can also affect the portion of public sector revenues. Thus by making contracts under PPP, the risk is been divided proportionally between the government and private sector thereby securing both client and contractor from getting violated (Innovative, 2012).

References

Aquasure (2017) Aquasure: The Victorian Desalination Project, 29 Jun, [Online], Available: https://www.aquasure.com.au/ [24 Mar 2018].

Bing Li, A.A.a.C.H. Risk involved in Public Private Partnership projects, [Online], Available: https://www.arcom.ac.uk/-docs/proceedings/ar2001-895-904_Li_Akintoye_and_Hardcastle.pdf [24 Mar 2018].

David, B. (2013) Paying for the Victorian desalination plant:A case study in regulatory ambiguity, 29 Jul, [Online], Available: https://www.esc.vic.gov.au/wp-content/uploads/esc/44/443ccc28-1966-421d-bfc2-7d6a920e080c.pdf [2018 Mar 2018].

e Victorian Government Department of Environment, Land, Water and Planning (2015) Victorian Desalination Project, Mar, [Online], Available: https://www.water.vic.gov.au/__data/assets/pdf_file/0013/54202/Fact-sheet-project-costs-March-2015.pdf [24 Mar 2018].

Innovative (2012) Risk Assessment for Public-Private Partnerships: A Primer, Dec, [Online], Available: https://www.fhwa.dot.gov/ipd/pdfs/p3/p3_risk_assessment_primer_122612.pdf [24 Mar 2018].

Kable Inteligence Report (2018) Wonthaggi Desalination Plant, Victoria, [Online], Available: https://www.water-technology.net/projects/wonthaggidesalinatio/ [24 Mar 2018].

Langdon, D. (2010) Compliance With Environmental Performance Requirements Quarter 1 2010 Quarterly Report To The Minister For Environment And Climate Change,Apr, [Online], Available: https://www.water.vic.gov.au/__data/assets/pdf_file/0019/54262/IREA-Quarterly-Report-Q1-2010-JanuaryMarch.pdf [24 Mar 2018].

LGPro (2017) Review of the Flora and Fauna Guarantee Act 1988 Consultation , Mar, [Online], Available: https://lgpro.com/downloads/Representation/LGPro_Submission_response_to_the_Review_Flora_and_Fauna_Guarantee_Act_1988_-_28_March_2017.pdf [24 Mar 2018].

Madden, J. (2009) VICTORIAN DESALINATION PROJECT ASSESSMENT under ENVIRONMENT EFFECTS ACT 1978 , Jan, [Online], Available: https://www.planning.vic.gov.au/__data/assets/pdf_file/0016/13516/Final_Assessment_-_Victorian_Desalination_Project.pdf [24 Mar 2018].

SUEZ Australia and New Zealand Victorian Dasalination Project, [Online], Available: https://www.degremont.com.au/media/general/VDP_8pp_FINAL.pdf [24 Mar 2018].

VICTORIAN DESALINATION PROJECT (2010), Jun, [Online], Available: https://www.aquasure.com.au/uploads/files/ProjectOverview.pdf [24 Mar 2018].

WEST GIPPSLAND CATCHMENT MANAGEMENT AUTHORITY (2015) Powlett River: Estuary Management Plan, Aug, [Online], Available: https://www.wgcma.vic.gov.au/wp-content/uploads/2015/10/Powlett-River-Estuary-Management-Plan-2015-Final.pdf [24 Mar 2018].

Willingham, R. (2017) Renewable energy target of 40pc by 2025 to be enshrined in law by Victorian Government, 23 Aug, [Online], Available: https://www.abc.net.au/news/2017-08-23/victoria-energy-target-of-40pc-by-2025-to-be-enshrined-in-law/8833276 [24 Mar 2018].

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