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The Environment Institute
Life Impact The University of Adelaide
Fixing the River MurrayWhat still needs to be done?
IRR Regional Water Conference, Adelaide 28 July 2009
Prof Mike Young Executive Director The Environment Institute Research Chair Water Economics and Management The University of Adelaide
The Environment Institute
Life Impact The University of Adelaide
Beyond the Plan
• What do we need to think about?
The Environment Institute
Life Impact The University of Adelaide
National Water Initiative
• Water that is provided by the States and Territories to meet agreed environmental and other public benefit outcomes ... is to:
– i) be given statutory recognition and have at least the same degree of security as water access entitlements for consumptive use and be fully accounted for;
A fully -specified sharing system for a regulated riverV
olu
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yste
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The Environment Institute
Life Impact The University of Adelaide
With half as much water
Users
Environment
River Flow
Environment
River Flow
Users
The Environment Institute
Life Impact The University of Adelaide
Climate Change Proofed System
• Critical Human Needs then
• Two pools
– High security
– General/Low security
• Moving size High Security Pool
– 10(?) year moving average of allocations
The Environment Institute
Life Impact The University of Adelaide
A nested MDA entitlement system
Murray below Choke
CE
WH
NS
W
AC
T
VIC
SA
High Security
CE
WH
NS
W
AC
T
VIC
SA
Low Security
CIT
Life Impact The University of Adelaide
Volu
me o
f W
ate
r in
th
e
Syste
mEnvironmental Water Trusts?
The Environment Institute
Life Impact The University of Adelaide
Environmental carry forward
• The CEWH will need less entitlement if 100% of all allocations can be carried forward
• Why not go to continuous accounting?
– Any allocation less evaporative losses can be carried forward
The Environment Institute
Life Impact The University of Adelaide
Investment in new or refurbished infrastructure
• 69. The Parties agree to ensure that proposals for investment in new or refurbished water infrastructure continue to be assessed as economically viable and ecologically sustainable prior to the investment occurring (noting paragraph 66 (v)).
• 66 v) full cost recovery for all rural surface and groundwater based systems, recognising that there will be some small community services that will never be economically viable but need to be maintained to meet social and public health obligations:
The Environment Institute
Life Impact The University of Adelaide
Infrastructure + buyback $$$$
• $8.9b was worth just over $5b
• When SCRM entitlements worth $9.9b
– $4b = 40% of value of entitlements
• Entitlements now worth around $14.5b
– $4b = 27% of value
– Could buy 13% at double market value
• Complete the buy-back this winter?
The Environment Institute
Life Impact The University of Adelaide
Stock recovery, if it remains dry?
• What is the plan to
– Refill the wetlands?
– Refill groundwater?
– Refill lower lakes?
– Refill the dams?
• Is the plan to wait for a flood?
• Should reconfiguration be contemplated
The Environment Institute
Life Impact The University of Adelaide
Groundwater-Surface interaction
• Risk assignment among systems
• Tagged trading among systems
– Boundaries
– Zoning
The Environment Institute
Life Impact The University of Adelaide
Concluding comment
• Australia is very lucky
– Our system allows markets to work
– We have embraced reform
– We are trying to get water management right
Life Impact The University of Adelaide
Prof. Mike YoungThe Environment InstituteThe University of AdelaideEmail: [email protected]
Subscribe to Droplets at www.myoung.net.au
