The Australian Experience

by Curt Burnett on July 28, 2009

Yesterday I promised a post on the luncheon speaker at the IA Water Conference. Mike Young is Professor of Water Economics and Management at the University of Adelaide. He kept our attention by describing Australia’s experience with extended drought (they now call it “climate change”) and the changes it has brought about in water policy.

Mike opened with a number of slides showing how dire Australia’s water situation is, particularly in the River Murray basin in the southeast. He gave the long-term average annual inflows to the river as about 7,200 gigaliters (GL) and the example year 2006-2007 inflows as 611 GL, obviously a very dramatic drop.

During the first few years of the drought, the collective response was similar to what it has been in the US when irrigation water supplies are stressed, using Mike’s word, “strife”. Battles raged over which of the water users would have to give something up. As he described it though, over time the realization sank in that all parties would have to cooperate, since in reality there was so little water left to fight over.

The model that eventually emerged through extended trial and error was what Mike described as “a robust sharing system.”
Its key points, from one of his slides, are:

  • Share rather than seniority system
  • Formal volumetric allocation systems
  • Minimal role for courts and lawyers

Key aspects include two classes of shares (high security and low security), universal metering of all water used, and individual rights to trade water shares, not tied to acreage but purely volumetric.

One interesting result of this new system was that some of the owners of water shares made a lot of money by trading them. Theoretically, this is a good thing because it puts the actual water in the hands of those who place the highest value on it. (This reminds me of an old saying in the American West, “Water always flows uphill to money.”)

Mike ended with the following pieces of advice for US water professionals:

  1. Encourage discussion of and planning for very long drys.
  2. Encourage transfer of ownership to individuals
  3. Encourage replacement of a seniority system with a share system
  4. Encourage integrated management of ground and surface water
  5. Encourage preparedness for a different water future and need to trade water on a daily basis.

I’m currently reading up on water law, so in a future post I’ll talk about the contrast between Australia’s current approach to water and typical US water law. It’s not surprising that many of the ideas that came to the surface there are also being discussed here in the US as some areas experience similar levels of water shortage.

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