Victorians will pay $613 million for the desalination plant this year, despite not a drop of water ever being ordered from the plant.

Water Minister Peter Walsh said a recent refinancing of the desaliniation plant would save Victorian families $187 million on their water bills.

He announced on Thursday that for the third consecutive year, he would not order any water from the Wonthaggi plant, which was built under the former Brumby Labor government.

“Total contract costs, without ordering water, still stand at $18.3 billion over 27 years but this is a $1.2 billion improvement on the deal Labor signed – a deal they tried to hide from Melbourne households."

He said Melbourne's water supplies were at 74 per cent and there was no need to order any water from the plant.