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Addressing compliance for regional waste water treatment plants


A regional local authority engaged Broadleaf to facilitate a workshop to resolve outstanding operational and compliance concerns raised by state government regulatory agencies about the upgrade of two waste water (sewage) treatment plants (STPs).

Project context

The regional local authority had recently let a performance-based contract for the reconstruction of its two treatment plants to meet revised discharge standards. The contract was let after an exhaustive process that initially saw open expressions of interest short-listed to three preferred tenderers, each of which completed preliminary designs as part of its tender submission.

The Design-Build-Operate (DBO) contract covered a minimum of 10 years operation beyond the completion of the upgrade works and included options for two potential five-year extensions. The provider was required to meet the licence discharge standards set out in the contract (against agreed performance criteria) or face punitive financial measures. The provider operated a number of similar plants in other parts of Australia under similar DBO arrangements.

The local authority was funding the contract from its own resources, with no subsidy from the State Government. However, the authority was still required to obtain formal approvals from the relevant Minister through the water regulator, and it wished to reassure the environmental regulator that the plant would meet its needs.

DBO processes were new to all of the government parties involved and they were all on a learning curve, but the provider had considerable experience of these contracts.

Since the contract was let the provider had been finalising the design. In the meantime, a formal 35% Design Review of the overall process design, and a HAZOP study, had been completed successfully.

There were four main objectives for the project, against which the impacts of risks were rated:

  • Ensure the financial sustainability of the STPs and the ability of the local authority to minimise the rates it needed to levy on the community
  • Maintain good environmental performance of the STPs throughout their operating lives
  • Maintain service delivery standards for waste water processing
  • Minimise adverse impacts on the local community.



The structure of the international standard ISO 31000 Risk management – Principles and guidance (Figure 1) provided a useful framework for the discussions.

Figure 1: Risk management process, ISO 31000

The risk management process

Establishing the context was completed prior to a risk assessment workshop. The workshop focussed on risk identification, analysis and evaluation. Options for eliminating, reducing, controlling or otherwise treating the high-priority risks were examined for a number of the more important risks during the course of the workshop.

Participants were drawn from many of the project’s main stakeholders, including representatives from and advisers to:

  • The local authority that owned the STP assets
  • The private sector company selected to upgrade and operate the assets
  • The state water regulator
  • The state environmental regulator.

Key elements

Key elements are a set of topics used to break the overall subject of a risk assessment into parts. They serve two main purposes:

  • They focus attention on topics that are somewhat smaller and more manageable than the entire scope of the activity under scrutiny
  • Taken one at a time, they set the agenda for the assessment workshop.

The elements selected in this instance are summarised in Table 1.

Table 1: Key elements




Technology design and equipment


Community expectations


Planning and approvals


Contract and contract management


Personnel (human resource management)


Natural and man-made hazards


Construction activities


Regulatory and environmental compliance


Other matters

Workshop outcomes

Much of the early part of the workshop focussed on operational and compliance concerns associated with upgrading the STPs that were raised by the water regulator, and the belief by the regulator that the solution proposed by the selected provider was higher-risk than STP designs in use elsewhere. Broadly, the regulator’s concerns encompassed:

  • The design of the tanks, which were different from other comparable STPs
  • Design assumptions, particularly about sludge loads
  • The performance of the plants during prolonged wet weather
  • The susceptibility of one of the plants to flood events.

The remainder of the workshop addressed other issues. It concluded with a presentation by the provider on the technology proposed for the upgraded plants.

38 risks were identified in the workshop, of which 16 were archived as they were either similar to or duplicates of other risks or of such a minor nature they did not warrant retention.

No extreme or high risks were identified; in other words, there were no fatal flaws. Most of the risks related to technology design and to natural hazards.

There were several reasons for the low rating of the risks. As well as the satisfactory completion of the 35% Design Review, three significant initiatives being undertaken by the local authority were identified as major control measures against many of the risks assessed during the workshop:

  • The development of the authority’s medium-term Strategic Plan
  • The development of a Flood Management Plan
  • The development of a Sewer Flood Study, linked to the Flood Management Plan but undertaken separately.

Although no extreme or high risks were assessed during the workshop, nevertheless it was decided to identify risk treatments where these were self-evident or reviews of the effectiveness of control measures were required to validate the risk analysis outcomes. The provision of additional data to the regulators, as agreed during the earlier discussions, was also incorporated in the risk treatments to ensure the action was recorded.

Overall, the risk assessment indicated there were no fatal flaws in the project and there was no reason, from a risk perspective, for the regulator to withhold approval.


This case study demonstrates several important things.

  • Having good controls, and being able to justify their effectiveness, leads to lower levels of risk. In this case routine processes, like the 35% Design Review, were valuable controls – that is why they are conducted as a standard part of projects like this.
  • A sound risk assessment process can provide assurance to regulators and support decisions to approve development works, even if the regulators have initial misgivings. Here the authority’s Flood Management Plan and Sewer Flood Study showed that many of the regulator’s initial concerns had been addressed already, and the provider’s technical presentation (with further detail to be made available to the regulator in the following days) alleviated the regulator’s apprehension about technology with which it was not familiar.
  • The workshop process itself often provides a forum for the main stakeholders to communicate their concerns and discuss them in a structured way. This contributes to mutual understanding and problem solving, and allows everyone to understand what they need to do to progress towards common goals. In this case the regulator had concerns that needed to be addressed before approvals could be granted; the workshop provided a forum for the issues to be explored in detail, the controls to be explained and discussed, and agreement to be reached about what additional information would be necessary.
Regional local authority
Local government
Public sector and government business
Services included:
Risk assessment and risk treatment