Earlier this year it was announced the new $14.8million drinking water supply could end up costing another $5million because of the discovery of the Lindavia intermedia algae.
Central Otago District Council capital projects programme manager Patrick Keenan confirmed to councillors at their meeting on Wednesday the previously proposed cartridge filtration treatment system for the supply was no longer suitable, because of the Lindavia and also ``rock flour'' in the lake - finely ground rock sediment that came from the Shotover River.
The Lindavia algae is non-toxic and poses no risk to human health, but it clogs filters.
A membrane filtration system would now be needed and trials needed to be done, Mr Keenan said.
His report said the additional cost because of the different filtration system was now estimated at between $5million and $7million.
Mr Keenan said the further testing would be done this summer in partnership with the Queenstown Lakes District Council.
Councillors approved spending up to $450,000 for its share of the trials.
Mr Keenan said it was thought the Lindavia algae - which thrived in warm conditions - was coming down the Clutha River from Lake Wanaka.
Council executive manager infrastructure services Julie Muir said earlier this year it was possible the Lindavia algae would also spread to other schemes downstream of Lake Dunstan, such as Roxburgh.
The information gathered from the filtration trials would be used not only for the Alexandra project, but also a proposed Cromwell treatment project scheduled for 2023, Mr Keenan said.
The Alexandra drinking water project involves taking filtered lake water from new bores near Lake Dunstan, at the Clyde drinking water supply source, building a new high-tech water treatment plant at Clyde to treat the water, and constructing a pipeline to take drinking water to Alexandra.
A pipeline to take Clyde wastewater to Alexandra for treatment is being constructed at the same time and will run alongside it.
