Audio Transcript:

One of the world's thirstiest major cities is getting a taste of things to come. Starting this winter, residents of Sydney, Australia are getting some of their drinking water from a brand new desalination plant. The plant was built after years of erratic rainfall. Phil Mercer reports from Sydney.

MARCO WERMAN: I'm Marco Werman and this is The World. Australia is a dry and thirsty land...and Sydney is a dry and thirsty city. But now, Sydney residents are getting some of their drinking water from a new desalination plant. Phil Mercer reports that the plant has opened to mixed reviews

PHIL MERCER: Australia is in the midst of an historic eight-year drought, the worst in a century. Sydney, the country's largest city, has been particularly hard hit. And there are concerns that it might be undergoing a long-term shift in its climate. Meanwhile, 50,000 new residents a year are pouring into the increasingly thirsty city. That's the dilemma that Sydney's new water factory aims to help address.

KRISTINA KENEALLY: It's a great pleasure to be standing here inside Sydney's desalination plant.

MERCER: Kristina Keneally is the American-born Premier of the state of New South Wales.

KENEALLY: This is about preparing for Sydney's expanding population. In the face of climate change, in the face of increasing drought, it is important we are securing Sydney's water supply.

MERCER: The new plant sucks water from a tunnel laid from the shore out into the Tasman Sea. It's then pushed through membranes small enough to capture the salt in a process called reverse osmosis. The plant can pump 66 million gallons of water each day, about 15% of the city's needs. It costs 1.7 billion U.S. dollars, and will push household water bills in Sydney up 40% over the next four years. But Kerry Schott, of the Sydney Water Corporation, says it's well worth the expense.

KERRY SCHOTT: We have historically had cities run out of water and they have been abandoned. That can happen in inland Australia also, and we certainly don't want it happening in a major city like Sydney

MERCER: But conservationists argue that the plant is a mistake. They say Sydney has no water crisis because efficiency measures have helped consumers learn to use far less. And they're concerned about the plant's impact on the marine environment. John Kaye is a Greens M.P. in the New South State Parliament.

JOHN KAYE: The construction of the tunnel under Botany Bay, gouged through the bottom of a very old bay, stirring up all sorts of heavy metals and all sorts of other materials that is having massive impacts on the ecology of the bay. And also dumping high salinity concentrate out into the ocean at the end.

MERCER: Kay is especially worried about the impact on migratory humpback whales, which pass by Sydney twice a year. The Water Corporation insists that the plant won't harm marine life, and says its salty waste will be easily absorbed by fast moving sea currents. Plant backers also point to an important environmental innovation. Desalination plants use huge amounts of electricity. In Australia, that generally means burning a lot of coal. But the Water Corporation's Kerry Schott says this one will be powered by renewable energy.

SCHOTT: A wind farm near Canberra. They provide us power obviously when the wind is blowing and when the wind isn't blowing we just take power out of the grid and they replace it with more wind power the next time the wind does blow. So, that solved our energy issue.

MERCER: Greens M.P John Kaye isn't satisfied with that solution.

KAYE: The government says it is all powered by green energy but that green energy could have been used to offset coal generation elsewhere.

MERCER: For their part, these Sydney's residents at Coogee Beach just up the coast from the desalination plant also have mixed feelings about the new facility.

FEMALE SPEAKER: The water is certainly not going to come from the desert, it has got to come from somewhere. So, yeah, if they can make use of the vast amount of seawater that we've got, then, you know, it's got to be a good thing.

MALE SPEAKER: Well, I think it is a waste of money. It costs over a billion dollars or a couple of billion to make it when you've got massive dams that are half full.

FEMALE SPEAKER: I think it's just a big waste of money. It just provides just what, 17% of Sydney's water, which is nothing. It's too costly.

MERCER: However well the new plant is received here in Sydney, it may be just a taste of things to come in Australia. Across the continent, authorities are forging ahead with plans for a second desalination plant near the Western Australian City of Perth. For the World, I'm Phil Mercer, Sydney.