Transcript GROUNDWATER TRADING IN AUSTRALIA: A Preliminary Analysis

OPTIMISING SUSTAINABLE USE OF
GROUNDWATER:
A Challenge for Science and Water Markets
John Brumley & Tamara Boyd
School of Civil and Chemical Engineering
RMIT University
Introduction
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Sustainable groundwater management rare prior to 1980s
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Aquifer over-development eventually seen as a threat
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Poor understanding of aquifers cannot stop us from action
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Trading can enhance management of groundwater
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Surface water trading has dominated reforms to date
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This must change
Drivers of Australian Water Reform
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Growing water deficit
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Enhanced allocation of current resources needed
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Deregulation of the water industry
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Focus shifted from resource development to management
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Brundtland Report, Agenda 21, National Strategy for ESD
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CoAG’s 1994 Water Reform Framework
CoAG Water Reform
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National policy for reform of rural and urban water
industries
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Explicitly linking fiscal and environmental objectives
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Jurisdictional differences in implementation
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Water pricing based on full cost recovery
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Comprehensive water allocations, separated from land
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Allocations for the environment and water trading
Ensuing Groundwater Program
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ARMCANZ groundwater policy discussion paper
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Objective: sustainable use of the resource
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Better integration of surface and groundwater
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Development of groundwater management plans
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Groundwater arrangements not subject to assessment
payments
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Yet consistent, coordinated action must prevail
Sustainable Yield
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Total allocations should not exceed sustainable yield:
the groundwater extraction regime, measured over a specified
planning time frame, that allows acceptable levels of impact
and protects the higher value uses that have a dependency on
the water
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Conceptually difficult to implement
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Methodology varies greatly between and within countries
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Aquifer characteristics or ‘default’ % of recharge
Issues
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Limiting extraction to recharge doesn’t control
externalitites
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Groundwater mining may be policy
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Las Vegas Valley, SA/Vic Border, Latrobe Valley
Intentional overallocation acceptable only when:
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Interference & environmental degradation
Publicly accepted strategic benefit
Resource is efficiently used and tightly managed
Resource may be overallocated but underused
Consequences of Excessive Withdrawal
Reversible Interference:
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Pumping lifts/costs increase
Well yields decrease
Springflow/baseflow reduction
Effect on phreatophytic vegetation
Irreversible Deterioration:
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Saline water intrusion/upconing
Ingress of polluted waters
Aquifer compaction/yield reduction
Land subsidence
(Foster, 1999)
Australia’s Groundwater Markets
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Impediments include:
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Deficiency in reliable data
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Less portable nature of groundwater
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Potential impacts from groundwater transfers
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Few embargoed areas, consequently ‘thin’ markets
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Activation of dormant licences
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Use of zoning to control transfers
Conclusion
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Trade can optimise economic benefits of groundwater use
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Hydrogeological and environmental checks must be met
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Groundwater must keep pace with surface water reform
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Considerable work to be done, including:
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Community/user education
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Data attainment & interpretation
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Understanding environmental allocations