Victoria’s Department of Treasury and Finance amended the Port of Melbourne Pricing Order in June 2026 to allow the Port of Melbourne to seek upfront regulatory approval for major infrastructure projects, particularly the Port Capacity Enhancement Program (PCEP) associated with the proposed Webb Dock North container terminal.
Unwelcome
Shipping Australia members did not welcome the decision.
For shipping lines, this amendment is a trade-off. There is the potential for higher future port charges in the short-to-medium term, in exchange for investment in additional port capacity and infrastructure intended to support future freight growth and reduce long-term congestion constraints.
Implications
- The port will be able to recover approved Port Capacity Enhancement Program costs associated with the proposed Webb Dock North container terminal; such costs will likely be recovered via tariffs. These costs these costs are exempt from some existing CPI-based (i.e. inflation) tariff increase limits, which increases the likelihood of tariff rises above normal inflation-linked increases.
- Greater investment certainty for capacity expansion – The Port gains regulatory certainty that approved project costs can be recovered, which is intended to support delivery of major capacity-enhancing infrastructure.
- Formal consultation opportunities: the Port must consult port users before submitting Strategic Project Applications, providing shipping lines with opportunities to comment on major investment proposals and associated costs.
- Independent oversight by the ESC: major projects and associated capital and operating costs are subject to review and approval by the Essential Services Commission before receiving special cost-recovery treatment.
Advice to the ordinary, everyday, families and consumers in Victoria
Shipping Australia members instructed the Shipping Australia Secretariat to advise consumers that it is ultimately they who will likely be paying up-front for infrastructure 20 years ahead of time and that the authorities are collecting money in advance for infrastructure that has not yet been built… or even defined. Members advised that they do not understand exactly what the port will be like in the future or where / how the investment will occur.
Members of Shipping Australia have expressed there high levels of concern about the situation, especially given that it is supposed to be a regulated, price-controlled, situation. Disbelief has been expressed at the possibility that the investors in the port at the time of privatisation could have possibly thought that they wouldn’t have to spend and funds during the regulated period. They are of the view that this is an attempt to acquire money in advance of provision of assets or benefits, which is morally wrong.
Members are of strong view that the Port of Melbourne ought to go to the capital markets to acquire funds for expansion.
The Policy Council of Shipping Australia instructed the Secretariat of Shipping Australia to place a note in the Shipping Australia Signal Newsletter explaining the situation; this note satisfies that instruction.
