New Zealand’s urban development is increasingly constrained by aging and overburdened infrastructure. Developers often face high costs, shared investment obligations, or outright restrictions due to capacity limitations. Expanding infrastructure requires careful planning, significant funding, and political stability at both local and national levels.
Water reform remains a pressing issue. Councils and utilities are developing Water Services Delivery Plans under the Local Water Done Well framework. These plans aim to provide sustainable, compliant water services despite financial and regulatory challenges. However, immediate solutions are needed to relieve infrastructure stress and enable responsible growth.
A Smarter Approach: Localized On-Lot Infrastructure (LOLI)
Localised On-Lot Infrastructure (LOLI) offers a decentralised approach to water management, integrating rainwater harvesting, greywater recycling, and on-lot wastewater treatment. By reducing demand on centralised networks, LOLI solutions provide much-needed flexibility for infrastructure planning and expansion.
For instance, a Waikato development initially limited to five homes due to wastewater constraints would require seven homes to be financially viable. By implementing Hydraloop greywater recycling, each home reduces water consumption by at least 30%, keeping total wastewater discharge within existing network capacity—allowing sustainable development without straining infrastructure.
Funding Sustainable Solutions
A key question is: Who pays for these on-lot innovations? Rising development costs could further inflate housing prices, but potential offsets exist. Development Contributions (DC) or Infrastructure Growth Charges (IGC) could be adjusted to incentivise sustainable solutions.
Watercare’s guidelines suggest that commercial customers who reduce water demand can lower their IGC. If the development contribution rules were to change to allow a similar reduction for residential developments, a reduction of the expected water use and wastewater discharge could be translated into a reduction in DC fees. While this may temporarily reduce revenue for councils and utilities, it allows time for necessary network upgrades and could decrease long-term infrastructure costs.
Ensuring Long-Term Viability
LOLI’s success depends on consistent maintenance. Without proper upkeep, expected reductions in network demand will not be realised, increasing strain on existing infrastructure. To mitigate this risk, regulatory mechanisms such as mandatory service agreements, resource consent conditions, or title-linked maintenance contracts must be established.
Many regions already require maintenance for on-lot wastewater systems where no central supply exists. A similar approach could ensure the long-term effectiveness of LOLI solutions, potentially through centralised maintenance contracts managed by residents’ societies or local governance bodies.
The Future of Water Resilience in New Zealand
New Zealand’s infrastructure challenges call for a balanced mix of centralised and localised solutions. LOLI can play a crucial role in easing pressure on existing networks, but pilot programmes and data collection are essential to refine these strategies and ensure their economic viability.
By integrating decentralised water management into broader infrastructure planning, we can build a resilient, sustainable, and inclusive future—one that safeguards our water resources for generations to come.
