A BEST USE SOLUTION FOR NEW ZEALAND’S WATER PROBLEMS 2008 DEDICATED TO MAKING A DIFFERENCE
Our thanks go to the following Briefi ngs: for their invaluable participation Auckland Water Industry Group and/or funding: Ecologic Auckland Regional Council Environment Canterbury Contact Energy Federation of Maori Authorities ECO MAF Engineers for Social Responsibility NZ Recreational Canoeing Environment Waikato NZ Forestry Owner’s Association Fonterra Otago Regional Council Federated Farmers PPCS Fish and Game Primary Sector Reference Group Royal Forest and Bird Protection Society Sustainable Water Programme of Action GHD Te Runanga o Ngai Tahu Horticulture NZ Tuwharetoa Irrigation NZ Waikato Tainui Meridian Energy Additional funding: Mighty River Power MAF MWH Kensington Swan NIWA NZBCSD Lead Consultant: NZWWA Aqualinc URS Watercare
No participant was required to endorse any part of the recommendation. CONTENTS
Contents
Executive Summary 3
THE PROBLEM 4 THE SOLUTION 6
Introduction 8
THE RESOURCE 8 WHY IS THERE A PROBLEM? 10
The Current Management Framework 13
OVERVIEW OF THE CURRENT FRAMEWORK 13 HOW THE CURRENT FRAMEWORK FALLS SHORT 14
Stakeholder Impacts 16
WHO ARE THE STAKEHOLDERS AND HOW ARE THEY AFFECTED? 16
The Vision 18
THE BEST USE SOLUTION 18 STRUCTURE AND FEATURES OF THE BEST USE SOLUTION 19
The Transition 23
IMPROVEMENTS NEEDED TO EFFECT THE BEST USE SOLUTION 23 COSTS AND RISKS 25
Summary 26
THE BEST USE SOLUTION 26 STRUCTURE AND FEATURES OF THE BEST USE SOLUTION 27 THE BEST USE SOLUTION - MAKING IT HAPPEN 28 TAKING THE NEXT STEP 28 THE BEST USE SOLUTION FOR NEW ZEALAND’S WATER PROBLEMS 29
Your Feedback is Welcome 30
Key Reading and Bibliography 31 We have just ten years to effect change... We need to start now. The solution carries a price. It also carries a multi-billion dollar reward over the next decade, while enhancing the environment.
2 EXECUTIVE SUMMARY
A Best Use Solution to solve New Zealand’s major water problems
New Zealand is fast discovering that with a vital interest in water, including environmental groups, freshwater is not an unlimited resource. Iwi, regional councils, energy generators, water suppliers and primary producers. hile New Zealanders want economic growth, they The outcome of this signifi cant collaboration is the Business Wdo not want it at the expense of our environment Council’s Best Use Solution to New Zealand’s water problems. and quality of life. Each year We believe the project has also 500,000 million cubic meters delivered widespread agreement of water fall onto New Zealand that the proposed solution is a as rain or snow, enough to fi ll good outline of a way which will Lake Taupo from empty eight better address the issues. times over. Despite this, key This solution offers a new areas have major freshwater starting point for practical quality and quantity problems. policy improvement. If we The quest to fi nd the best don’t act, the current system ways to protect our waterways, will see all major catchments allocate what is truly available fully allocated by 2012. and do it more simply, quicker We will see business and at least cost has been opportunities evaporate, subject to extensive desk and the spread of rationing, research and debate within queuing and disputes over policy-making circles for a what remains of the resource. number of years. It might be None of this is necessary. said that the issue of water We have just ten years to allocation, and desired reforms effect change and avert these in particular, have been problems. We need to start acknowledged as being ‘very, very diffi cult’ given the lack of now. The solution carries a price. It also carries a multi-billion consensus for a way forward on the issues. It is against this dollar reward over the next decade, while enhancing the background that the New Zealand Business Council for environment. It is the sort of solution the Business Council Sustainable Development commissioned a collaborative most likes to fi nd – a practical way to make sure we identify research project. the volumes of water needed to protect everything we regard From August 2006, we have been working with 20 (and as precious about our water sources and way of life – while consulting with a further 14) businesses and organisations effi ciently allocating the amount identifi ed as available for use.
Nick Main Chair New Zealand Business Council for Sustainable Development July, 2008
3 EXECUTIVE SUMMARY
The Problem
The cost if we do not act that this water is unavailable for productive An estimated 11% of this water is y 2012 all the available use. This will have serious consequences used in hydroelectricity generation. Bfreshwater resources in our most constraining New Zealand’s economic In many instances this water is used economicaly signifi cant regions will development and resulting in increasing many times for hydrogeneration without be fully allocated to users on what is confl ict between competing demands. abstraction from waterways and is still essentially a fi rst-in, fi rst-served basis. Growth in our urban and main agricultural available to downstream users. Depending upon how individual Regional areas is also going to be constrained. Only a very small percentage (about Councils use the existing tools in the Once full allocation is reached, 5%) of New Zealand’s total rain and 1 Resource Management Act, this could unravelling past mistakes, or putting snow precipitation is abstracted for lead to a situation where people wanting water aside for future requirements, commercial use, mainly for farming. to secure a right to use water after full becomes more challenging as does Greater intensity of use is affecting allocation has been reached, will only allocating water for new uses. water quality. Waterways have a limited be able to practicably obtain that right Demand is being driven by: capacity to assimilate contaminants (nutrients and other discharges such as by buying land that has an existing water more intensive land use and heavy metals). Waste harms fl ora and consent. Additionally, water that has been irrigation, particularly for agriculture allocated to existing users but which is fauna in our waterways. It also means not needed for use could remain largely a growing population, driving demand municipal water plants have to provide unavailable to those who have a need for for electricity and municipal supplies more treatment – at greater cost – to it. This allocated but unused water ranges for human and industrial use. continue producing safe drinking water. between 20-80% of the allocated supply These problems will not correct Growing intensity of use depending on factors such as time of themselves. has wide impacts year and crop type. Currently the RMA has limited provision for the voluntary transfer Most of our water from rain and snowfall fl ows naturally and unimpeded to the sea. of surplus allocated water. This means 1 abstracted: water removed from the source.
Surface water allocations 2007 - 2012 by major catchment boundaries, percentage of surface water allocated
2007 2012
Most regions have at least one populated and main agricultural areas, KEY river (surface water) or aquifer the known available water resource is Fully or over allocated (groundwater) that is either fully or expected to be fully allocated by 2012. over allocated, or likely to become Greater than 75%, less than 100% Major economic and environmental so in the next one to fi ve years. gains are possible from allocation Less than 75% allocated Over a signifi cant proportion of New improvement. Zealand and particularly in our highly Unknown (or groundwater zone)
Note: maps represent the consultant’s interpretation of survey results. 4 EXECUTIVE SUMMARY
Further public concern lakes in the central North Island, at the The system does not always easily New Zealanders are also concerned cost to the taxpayer of $83 million and provide a basis for balancing confl icting about the diminishing quality of our natural $73 million respectively. values for water including: waterways. They perceive intensive environmental needs land use (like that associated with the Allocated water not used growth of agriculture, especially dairying) In New Zealand water is managed by the recreational values is responsible. Some 64% perceive Crown on behalf of all citizens. cultural values agricultural and horticultural run off as the New Zealand has a fi rst-in, fi rst-served municipal supply for households and main cause of freshwater pollution. system of allocating water. Some of this urban businesses, 68% perceive freshwater quality to be water is allocated to those who may not worse or much worse than ten years ago fully use it. But their surplus allocation is other economic needs. and seven out ten believe there is a water not easily made available for others. When there are water shortages, often shortage now or will be within fi ve years. It is diffi cult to transfer rights because the environment pays when the baseline the Resource Management Act (RMA) water flows, needed to preserve the Major local water quality problems states that resource consents grant a right environment, are compromised. While many parts of the country are to use water to the landowner. Regional managing the increasing demands on Councils must also provide for transfer of The consequences of no change water quite well, some areas still face water rights, through their Plans or through If the country does not change the signifi cant water issues relating to quality approval of one off applications. Thus way it allocates both surface and and quantity. those wanting a right to use water may ground water then: In Canterbury, Waikato, Rotorua and need to buy land to access the water right. future water users, who can use Taupo areas, the investment by central, Land with access to water is much more water in more productive ways, could and local government and the private valuable, which is refl ected in farm prices. be required to buy land off a current sector to resolve these water issues This transfer process is easier for consent holder in order to get access is extensive. Central and Regional members of established irrigation to water. Future users would then Government have promoted initiatives schemes, as they can transfer, water have to pay the costs associated with to clean up Lake Taupo and the Rotorua within the scheme. redistributing the water (secured by land purchase) through applications to the Regional Council for new consents specifi c to their commercial use. If approved, excess land could be on- sold without the water access. new water investment will be blocked moratoria will be imposed on granting new consents in some major catchments
the publicly-funded costs of water quality clean-up will continue to rise. This will result in: a needless and signifi cant drop in potential production and economic growth ($180 to $330 million per year)
(Source: Aqualinc, 2008) water quality continuing to be at risk the “gold-rush” of applications for water rights to the remaining available water escalating increased litigation and confl ict as shortages occur.
5 EXECUTIVE SUMMARY
The Solution
ew Zealand needs an agreed way of managing our freshwater Allocating the water available for Nresources so it is used for the greatest benefit in a way that commercial use and managing quality meets and balances the need for: We need to better use and extend the enhancing the Resource Management Act’s sustainable management effects management consent tools of the objectives and preserving the environment and ecology RMA to: separately consent the take and use preserving recreational and cultural use and enjoyment of water preserving current economic uses where feasible enable proportional sharing between maintaining municipal water supplies commercial users of water based on how much water is actually available allowing economic growth, through higher productivity and delivering for commercial use. This way users improved living standards. take on the risk that comes naturally All of this is possible. with the climatic variability impact on water supply. The Best Use Solution Adopting the Best Use Solution will involve a number of improvements allow existing users access to water in the law and the process used within catchment rules and contaminant Mixed statutory planning and market at Central and Regional limits set by the community framework Government levels: The Business Council proposes a Best introduce a mechanism enabling Use Solution – to deliver improvements the re-allocation of surplus water Integrated Catchment for all users, planners and managers, on a voluntary basis to the most Management Planning and the environment. productive use. In this way, unused Regional Government in participatory water already consented but surplus planning processes will set the rules It involves: to requirements can be transferred to for managing the environmental, other consented uses. managing both surface and ground recreational, cultural and economic water resources with a mixed statutory- interests in their catchments, with central introduce a “cap and trade” planning and market-based system. government guidance through National mechanism whereby a limit or cap is Policy Statements (NPS) and National put on contaminant discharges that If these improvements are adopted: Environmental Standards (NES). can be made (which can be voluntarily The community, through its planning transferred), thus maintaining or Measuring community needs systems, will determine the initial allocation improving raw water quality. and values limits and set water quality limits for using If the current contaminant level is too We need to accurately measure and our water resources taking into account high the ‘cap’ can be a sinking amount gather knowledge about our waterways that is reducing over time until the public interest values so we can: desired level of contaminants is reached. the aquatic ecosystems set environmental and instream
fl ows to have enough water in the cultural values waterway for environmental, cultural recreational values and recreational use, for humans to consume and for livestock irrigation and other industry needs decide how much water is needed to power generation requirements maintain or improve quality municipal use. decide how much water will be A voluntary market will be used to available for commercial use re-distribute the water allocated for commercial and municipal use while set the limits for contaminants (nutrients ensuring businesses and municipalities and other discharges) and run-off live within the boundaries set by the entering our waterways and aquifers. community in the planning process.
6 EXECUTIVE SUMMARY
These are New Zealand’s principal water problems, and the solutions which can be delivered by the Best Use Solution arising from Business Council research:
KEY DEFINITION PROBLEM SOLUTION
QUANTITY Freshwater resources in the populated and Tools to measure and manage water takes intensely farmed areas of NZ will soon be and fl ows and enable water use transfer. fully ‘allocated’. Limited ability to transfer surplus allocated but unused water.
QUALITY Declining quality and associated clean-up Cap and trade for contaminant discharges, costs. Many water users have concerns to operate within the limits of capacity of about quality (including nitrogen, microbes, waterways and groundwater to assimilate algal bloom and mercury levels.). them. A benefi t for users that reduce contaminant discharge or runoff
EFFICIENCY Poor incentives to improve effi ciency of use Pricing through tradable entitlements will because users don’t pay for higher reliability and provide incentives for more effi cient use. use-it or lose-it rules encourage ineffi cient use.
PLANNING Politicised process with little Central Complete policy tools urgently e.g. NPS, NES to Government guidance; lack of tools for setting provide greater certainty of what is available to environmental limits. Decision making process take and guidance on various uses. Extend use increasingly litigious. of Integrated Catchment Management Plans.
ALLOCATION Few regional plans have set allocation limits. Allocation of all water to one of four primary Lack of monitoring and metering of pools. Only one of these pools is for consented resource and use. use where transfers are allowed. Metering required for all signifi cant takes.
RISK Every user wants access to maximum Improve knowledge of reliability for greater allocation with the highest reliability. certainty of supply. Require users to take In times of shortages, ecological impacts proportional shares in water available for taking. can dramatically increase. The majority of the risk of changing volumes The current system does not refl ect the is then with the users, as a result of variability natural variability in water fl ows. in availablity.
INVESTMENT Uncertainty around honouring existing take A 35-year + 35-year-term for access entitlements levels and length of consents affects long-term to water should enable access holders to investment because past “promises” may not underwrite long-term investment (irrigation be able to be kept. Regional Councils manage schemes or hydrogeneration). uncertainty by keeping consent durations to the minimum.
LONG-TERM First-in fi rst-served gives no opportunity to take Move to a value-based allocation with long-term STRATEGY a strategic view; current assumption is that clean strategic focus on future demands on a water will always be available in catchments catchment taken by Regional Government even once full allocation has occurred. with Central Government guidance. Water continues to be used but can be earmarked for future use (new town, new industry.).
KNOWLEDGE Limited knowledge about some aspects of Ongoing and strategic investment in water resources (e.g. who uses how much development of knowledge of water resources, and where, what are assimilative capacity which can be shared, particularly in regions limits) makes management, decision and catchments short of water. making and planning diffi cult.
7 INTRODUCTION
The Resource: How Do We Use It?
ater helps defi ne our quality Wof life in New Zealand and supports our economic development and growth.
A key input for manufacturing in Iwi, as do most New Zealanders, many industries including meat, think of healthy freshwater ecosystems dairy, horticulture, seafood, and and a healthy coastal environment as timber processing. part of our cultural identity. For Iwi, Freshwater is also needed to water is Taonga, a treasured asset Freshwater is: assimilate the wastes that go back and crucial to supporting traditional An essential resource for agriculture, into our natural water system. food species and habitats. especially for irrigation and livestock: 17% of New Zealand’s GDP is directly or indirectly derived from “Ask New Zealanders about primary production. (Source: MAF, 2003) the things that make living in New Zealand special and they will include being Photo: Amy&Kimball able to safely take fi sh, swim New Zealanders rely on good quality and go boating in our lakes, freshwater for drinking, washing, cooking, recreational activites and rivers and streams. water is essential for fi refi ghting. Ask A major energy source. In 2001, ” New Zealanders about the things that hydrogeneration produced more make living in New Zealand special than 24,000 gigawatts of electricity, and they will include being able to safely nearly 60% of total generation capacity. take fi sh, swim and go boating in our Hydrostations along a river (like the lakes, rivers and streams. In some Waikato) can use the same water communities, local environment multiple times to generate electricity. protection groups act as guardians Freshwater is also important to other for their region’s freshwater rivers,
generation forms, like gas and coal- Photo: Genesis streams, lakes and aquifers. fi red stations where it is used for cooling. Huntly Power Station uses the Waikato River for cooling water. While our rivers, lakes, streams and As New Zealand has a 90% target for wetlands are deeply valued natural generation from renewable source, A major part of healthy ecosystems assets, we often assume these will there will be increasing reliance on and the New Zealand “100% clean remain a high quality unlimited resource hydropower to generate renewable and green” brand that attracts millions for generations to come. But freshwater electricity. of tourists a year, with an economic is a limited resource that is now value of more than $18 billion. vulnerable to a variety of pressures.
8 INTRODUCTION
The Resource: How Does the World Use It?
No water = No business Water is a critical input for many production processes. For example, according to the World Business Council for Sustainable Development, it takes: 70 LITRES 2,700 LITRES to grow an apple to make a shirt. (Of this 45% is irrigation water; 41% is rainwater that fell on the cotton fi eld during the growing period; and 14% is water required to dilute the 140 LITRES wastewater resulting from fertiliser use in the fi eld and for a cup of coffee chemicals in the textile industry.)
Globally, cotton production uses 210 billion cubic meters 40 LITRES - and pollutes 50 billion cubic meters - of water a year. The to produce a slice of bread cotton crops use 3.5 % of the world’s crop production water.
Source: WBCSD and Waterfootprint.org, NZBCSD recognises that these are estimates of virtual water, based on certain production systems and does not endorse them as offi cial or necessarily NZ fi gures.
Where Does Our Water from empty eight times over. USE OF ABSTRACTED Come From? Most freshwater from rain and WATER IN NEW ZEALAND snow each year eventually fl ows STOCK WATERING ew Zealand’s unique 3% PUBLIC WATER SUPPLY to the sea. 9% freshwater profi le N Only about 5% of the annual New Zealand’s freshwater bodies INDUSTRIAL infl ow is extracted for 11% are mainly made up of relatively small commercial use, mainly catchments including rivers and streams for farming: the so-called with a total length of 425,000 km. ‘abstractive’ uses. Half of this lies in catchments with IRRIGATION 77% natural land cover – bush, alpine rock and tussock. (Source: MfE, 2006) Some 43% of this river length is in catchments that have been modifi ed by 5% ABSTRACTED FOR USE agriculture, 5% by plantation forestry and EQUATES TO 25,000 MILLION CUBIC METRES just 1% by urban settlement. Hydrogeneration’s use of water is equivalent to 11% of the total infl ow Of New Zealand’s 50,000 lakes: or 52,000 million cubic meters. 4,000 are larger than one This water remains in the waterway hectare and is able to be made available more than 200 have an area NEW ZEALAND GETS 500,000 to other users, such as recreation greater than 50 hectares MILLION CUBIC METRES on hydrolakes, before and following about 40% are in catchments OF WATER FROM RAIN AND generation. where agriculture is the SNOWFALLS ANNUALLY Around 95% of the annual major water use. infl ow remains in the natural water There are about 200 groundwater system maintaining ecological health bodies or aquifers. and meeting minor human and stock, Each year 500,000 million cubic firefighting, cultural and meters of water fall onto New Zealand as recreation needs. rain or snow, enough to fi ll Lake Taupo (Source: MfE, 2007)
9 INTRODUCTION
Why is there a problem?
ew Zealanders are deeply Water quality has been declining in Nconcerned about freshwater. catchments where there is intensifi cation New Zealanders see fresh water as a of land use activities such as agriculture key to their ‘quality of life’. and urban sprawl. The decline is A national online survey conducted showing in higher contaminant level by ShapeNZ in August 2007 for this measurements. The Clean Streams research project fi nds: Accord, one of a number of voluntary signifi cant public concern about programmes in place has begun to diminishing quality. 68% perceive address some of these issues. freshwater quality to be worse or Case study 1: much worse than ten years ago. The Waikato’s Growing Burden Recent studies in the Waikato region a belief that a major cause is have indicated increasing levels of intensive agricultural land use. 64% phosphorous and nitrogen at several perceive agricultural and horticultural sites on the Waikato river, caused by run-off as the main cause of fresh wastewater and agricultural run-off. water pollution and, (Nitrogen as a nutrient boosts nuisance This map of the Waikato River records nitrogen levels seven out of ten believe that the aquatic plant growth which chokes along its route to the sea. These levels are considered a proxy for the ecological health of the river. Anything country is suffering a water shortage waterways and out-compete native over 0.5 grams per cubic metre is undesirable thus now, or will be within the next fi ve years. species.) the nutrient levels from the Huntly Bridge to the Port Waikato are currently unsatisfactory. It is predicted that While environmental pressure from proposed dairy farm conversions will increase present nitrogen levels by 70% by 2030. Quality – a question wastewater has not changed much (Source: Environment Waikato) of “management” in the study period, farming has continued to intensify as the region The lake’s overall quality is likely to Historically, water quality management continues to grow and develop, putting worsen as more nutrients come to the in New Zealand has focused on the further pressure on water catchments. surface in future years. sources of discharges into water Fortunately most of New Zealand’s The local community has established (‘point source’ discharges where a rivers are not nutrient enriched. However, a trust to enhance the long-term health farm, factory or town, returns used this does demonstrate an important of the lake, primarily by reducing nitrogen water through a pipe going into a economic effect: as the river fl ows to pollution. The Trustees are aiming to stream or river). We have encouraged the coast rising pollution levels coincide achieve a 20 % reduction in nitrogen technological improvements to our with areas of higher population density. entering the lake from both rural and production processes and greater use More pollution also means higher costs urban sources. of waste treatment plants, as well as to treat raw water. The Trust programme will cost developing better understanding of the If the volume of water in the stream $83 million, being raised jointly over capacity of our waterways to assimilate reduces because of drought or greater 15 years by Environment Waikato, discharges (contaminants). abstraction, the capacity to assimilate Taupo District Council and Central Quality monitoring of ‘point Government. The fund will be used to contaminants decreases. We therefore source’ discharges track whether encourage and assist land use change, have to plan the management of both they are within the limits set within and to buy land in the Lake Taupo water quality and quantity together. a discharger’s consent. However, catchment, as well as other initiatives the effects of discharges from other Case study 2: to help landowners to reduce activities sources (‘non-point’ discharges such Lake Taupo - Nitrate in lower water which discharge nitrogen into the lake. as run-off from land or roads) have also layers up 100% in 30 years A joint committee of these three agencies, been identifi ed as a serious freshwater Well-documented problems with Lake along with the Tuwharetoa Maori Trust Board, oversees the Trust’s activities. management challenge. The largest Taupo’s water quality have been caused impact on water quality in our rivers by nutrients – especially nitrogen from and groundwater (including aquifers) land use around the lake. The amount comes from how we use land. of nitrogen loading in the lake’s lower water layers has increased 100% over the past 30 years.
10 INTRODUCTION
Quantity – NATIONALLY As a result, many large river systems not enough water and groundwater sources, including The amount and rate at which aquifers, are at or are rapidly reaching a Freshwater demand has undergone water is allocated for abstraction is state of full allocation for abstractive use. signifi cant change since the 1980s in 679 cubic metres per second. This means that no more water can particular due to increases in agricultural be taken from them without causing intensity and the subsequent demand to 5% of the total annual fl ow is environmental harm or affecting existing irrigate pastureland. This can be seen in abstracted from our river systems. users’ entitlements to abstract water. the high percentages of irrigation-related 77% of this total volume of water consents both in terms of number and abstracted is for irrigation. Regional government is managing this the volume of water abstracted. The Canterbury region alone situation through a number of ways including: Consented takes issued allocates 55% of this national total in New Zealand volume of water. rationing, whereby consents are About 20,000 individual consented reviewed and adjusted to reduce takes have been issued in New Zealand. The limit is being reached: allocations Irrigation has the highest number for In some areas we are reaching the putting would-be new users on abstractions – 78% of total consented point where pressure to satisfy our waiting lists until water becomes takes. This compares with 11% for different needs and values in the use available at a consent expiry date. industrial uses, 9% for public uses and of freshwater is pushing the resource
2% for stock water use. to its sustainable limits. (Source: MfE, 2006)
Effect of 10 year increase in consented abstractions from groundwater in Climate change: Canterbury: Groundwater levels at monitoring bores 1995-2005. droughts to worsen Climate change is now also expected to compound problems this century by CHRISTCHURCH increasing the risk of drought in all areas CITY that are already drought-prone. Climate change modelling suggests most eastern areas of New Zealand will become increasingly dry. Modelling also suggests New Zealand will experience changes in the frequency of droughts, rainfall patterns, and evaporation rates, which are likely
Cubic to change water fl ows and aggravate metres per day existing problems with water availability. per sqkm More water will need to be available in drought-risk areas (through storage and irrigation) to keep pasture growing CHRISTCHURCH at its daily potential rate, and prevent CITY production losses.
Cubic metres per day per sqkm
(Source: Environment Canterbury)
Groundwater levels in Canterbury are falling due to both drought and irrigation. 11 INTRODUCTION
Trends in allocation and irrigated areas In New Zealand, total water allocated for abstraction increased by 50% between 1999 and 2006. The increase in abstraction can largely be explained by the increased demand for water for irrigation. During this same period, the amount of consented irrigated land in New Zealand increased by 52%. Canterbury has the majority of irrigated land (66%) followed by Otago (14%).
What is happening in different regions? Abbrev Region Distribution of consents by use, source and region ARC Auckland Regional Council There are four categories of consented use: irrigation, stock, industrial and EBOP Environment Bay of Plenty household. Irrigation consents by volume of water account for the largest ECAN Environment Canterbury proportion of consents in most regions, apart from Southland and West Coast. ES Environment Southland In these two regions industrial consents are the largest proportion. EW Environment Waikato GDC Gisborne District Council There are three categories of sources for consented use: storage (lake), surface GWRC Greater Wellington Regional Council water and groundwater. Groundwater consents predominate in all regions except Otago. HBRC Hawkes Bay Regional Council HRC Horizons Regional Council 7,000 MDC Marlborough District Council Use Primary Source 6,000 NCC Nelson City Council Irrigation Storage 5,000 Stock Surface water NRC Northland Regional Council Industrial Ground water ORC Otago Regional Council 4,000 Households TDC Tasman District Council 3,000 TRC Taranaki Regional Council
CONSENTS (no.) 2,000 WCRC West Coast Regional Council
1,000
0 ES EW TRC TDC ARC HRC NRC NCC GDC ORC MDC EBOP ECAN HBRC WCRC GWRC CONSENTS BY USE, SOURCE AND REGION
Consented irrigation area increases This fi gure shows the consented irrigation area in (ha) for 1999 and 2006 for 650 each region. Most regions recorded an increase in consented irrigated area from 600 1999 1999 to 2006. Auckland, Northland and Gisborne regions recorded a decrease 550 in consented irrigated area. 2006 500
45 450 1999 40 400 2006 35 350
30 300
25 250
20 200
15 150
10 AREA (ha) 000 CONSENTED IRRIGATED 100
5 50
CONSENTED IRRIGATED AREA (ha 000) CONSENTED IRRIGATED 0 0 ES EW TRC TDC ARC NRC HRC NCC GDC ORC SEE GRAPH ON RIGHT MDC ORC EBOP ECAN SEE GRAPH ON RIGHT HBRC ECAN WCRC GWRC CONSENTED IRRIGATED AREA BY REGION CONSENTED IRRIGATED AREA ECAN, ORC
(Source: MfE, 2006)
12 CURRENT MANAGEMENT FRAMEWORK
Overview of the current framework
he Resource Management Act When granted, consents are site- covering metering and methods for T1991 (RMA) provides the current specific but can be transferred to allocating water to protect aquatic framework for freshwater management. new owners or occupiers of a site, ecosystems. The principles of these NES Central Government is involved in water and sometimes to other sites within are consistent with the Best Use Solution. management through issuing National the same catchment (if permitted by Policy Statements and Environmental the Councils). Full allocation Standards and by submitting As some water bodies become on Regional Councils’ Plans, fully allocated, there is growing and Water Conservation Orders demand to transfer consents, (orders that protect the but this normally involves a full outstanding ‘amenity or intrinsic consent application which is values’ of a particular water body). costly in both time and money. New Zealand law is silent on Regional Government take who owns water, but vests all different approaches to resolving authority to manage it in the full or over allocation, including: Crown. The Business Council’s defining minimum flows Best Use Solution assumes the and limiting the amount present position that authority of water that can be to manage water rests with the taken from rivers and Crown. groundwater sources
Allocation and consents waiting lists – they do not to take water grant any further consents until water becomes Regional Government available when consents Freshwater is managed by are abandoned or come to Regional Government, who are the end of their term and responsible for the water bodies within Benefi ts of the current system are not renewed their boundaries, through implementing There are several benefi ts of the current rationing schemes, in which existing the RMA. water management framework and it consents are reviewed and adjusted They manage water allocation and works well in situations of abundant to reduce allocations (‘haircuts’). quality issues by means of Regional Policy water supply and low demand pressures. This review process is similarly used Statements and Regional Plans (which The RMA clearly defines roles for during water shortages. can specify the amount of water that enabling regional plans to be developed. can be taken from certain water bodies These plans give the community In the past, people have applied for the and state how the water is allocated to certainty over the goals and methods maximum they are likely to use. As a result: users) and through the resource consent for freshwater management and aim to rights were therefore allocated to process, as defi ned in the RMA. minimise adverse local effects on New those who did not fully use them Applications to take or use water - or to Zealand’s freshwater environment. most of the time, their surplus or discharge to water - are assessed against unused allocation would not be easily the Council’s Regional Plan and Policy Current Reforms made available for others, as it is Statement. The RMA provides for resource The Sustainable Water Programme of currently bundled in a consent to take consents to be processed and granted Action launched in 2003 by Central and use water, when only the use or under a fi rst-in, fi rst-served system, with Government aims to identify priorities part of the use needs to be transferred. individual applications assessed against for government action to improve the Council’s stated objectives and policies freshwater management in New Zealand. The current transfer process is clumsy, for water allocation and use. In 2007, the development of a National diffi cult to use and costly. It also does When the amount of water available Policy Statement (NPS) on freshwater not encourage the effi cient management exceeds likely demand the ‘fi rst-in, fi rst- was approved and is due for release in of water quantity or water quality. served’ model works well as one user’s July, 2008. Two National Environmental needs do not preclude someone else’s Standards (NES) have been drafted being met. 13 CURRENT MANAGEMENT FRAMEWORK
How the current framework falls short
reshwater management in practice of those seeking additional water. catchments by 2012, because of an FNew Zealand does not A signifi cant amount of water is ineffi cient allocation system. Within the consistently provide: now locked up. Between 20-80% of same total allocation, more water could adequate protection of be made available for best environmental and in- use and production, while not stream values risking the environment and other valued in-stream uses. adequate fl exibility for maximising the value derived Regional level planning from water made available needs better tools for commercial use. Current regional plans lack the specifi city of rules and scope As more freshwater is allocated needed to provide certainty to for various uses, management all parties about the quantity will become more expensive to and reliability of water set aside administer. We need to better for taking and to be kept in the use and extend the consent water body. tools of the RMA to manage The decision-making when there are more wanting processes that develop current water than there is water water management plans lack available. robust, water-use-specifi c The resulting uncertainty quantitative information on the makes water related local, regional and national investments, like irrigation or benefi t expected from water hydrogeneration schemes, taken from or retained in the more diffi cult to get off the ground. the water already allocated may be water body. Planning and decision-making processes available for redistribution (transfer) and As a result, it is diffi cult to establish the for water management also become use depending on seasonal fl ows and underlying value of water where there less robust as pressure on the resource demands under the proposed revised are multiple potential uses and users. increases. management framework. (Source: MfE, 2006) There is diffi culty in optimising local, Potential new users are not able to Allocation a battlefi eld regional and national benefi ts from water access this water, making the Some uses of water can demonstrate use permitted by the community in system inefficient. higher economic value than others. balance with ecosystem values. Allocated volumes are maximums and Some have higher or lower Planning lacks strategic long-term views tend to overestimate the amount environmental, aesthetic and cultural and often focuses on short-term pressures. of water actually abstracted. value but these are not easily managed We need to use tools to ensure the The reasons for this include: in the current framework. community, recreation and environment This is partly because in-stream values allocations are based on peak or values are refl ected in water are often aggregated, making it hard to near-peak demand management plans. clearly defi ne management goals and the different users require peak volumes Stronger national direction required rules to meet those goals. These issues at different times Nationally, there is little guidance provided are being addressed at least in part, by for making policy at the catchment the National Environment Standards not all of the allocated volume is level. Regional Councils are oftern for Water Metering and for Ecological required every year attempting to make allocations and Flows and Levels. The latter specifi cally some water is not used but is manage the effects of consents in separates ecosystem requirements from reserved for future use the absence of good planning. While those of other uses such as recreation, natural variations in the weather. statements of intent for national overview aesthetic and cultural values. and direction have been voiced, National As a result, challenging allocation As a result, allocated maximum volumes Policy Statements (NPS) and National limits and environmental minimum are generally not a good proxy for actual Environment Standards (NES) are only fl ows through Council hearings and the water abstraction. Hence, New Zealand now emerging. However the process Environment Court, has become the will face full allocation of water in many of development of these types of 14 CURRENT MANAGEMENT FRAMEWORK
How the current framework falls short instruments includes a high degree of waterway or aquifer. This can depend actually taken varies across the country. uncertainty over the outcome. on a number of factors including rainfall, In order to be able to develop robust There is similarly no guidance from soil type, and the irrigation method water accounts far more monitoring and Central Government for establishing a used. The Best Use Solution includes recording of water is required. hierachy to resolve the water As a result, Regional issues confronting water Government stressed regions. do not have a full understanding At a national level, there is of actual pressures on their also a lack of defi nition around rivers and groundwater what is a public benefi t (and resources. hence what is justifi ably rate This gives rise to uncertainty funded) and what should be about the causes and effects user funded. of changes they observe in their waterways. This is For example, key distinctions also an impediment to water needing better defi nition include: management and establishing the monitoring of a river – is transparent and effi cient water that for the public benefi t? transfer processes. how about metering of We therefore need to better takes – should that be plan and allocate water to user funded (as discharges keep freshwater quality at are now)? acceptable standards and let This inability to measure public all New Zealanders benefi t benefi t results from the lack of from its use. widely agreed on and accepted Specifi cally, we need a framework that: research and monitoring to deal with tools that work across industrial, sets an upper limit to the amount recreational and customary uses. this as a critical issue in the most stressed catchments. of water able to be allocated or A lack of national direction extracted from a waterway also creates risk and uncertainty ‘Bundling’ results in high transaction shares the natural risk of water costs for transfers The current system doesn’t distribute availability risks across stakeholders, nor does it Take and use consents are often issued provide clarity around who carries the risk together, rather than separately. consistently determines the if the volume of water available changes When combined, this can make amount of contaminants or other for uses that are already consented. conditions attached to the consent too substances that a water system can complex and unenforceable. It also assimilate, and A lack of tools affects water quality increases the time and cost involved has a way to transfer water or The cumulative effects of water takes when trying to transfer part or all of the discharge rights available for use and contamination of water are not water associated with the consent. within those limitations. well managed. While land-use controls, Most current approaches to managing such as restrictions on the application transfer of take consents involve a process rate of fertiliser, are being implemented equivalent to a new take consent. This to reduce the loss of nutrients, such is time consuming, costly and often practices do not address directly the becomes politicised. key issue of managing non-point discharges, and living within the Insuffi cient monitoring and metering assimilative capacity limits of waterways The current level of monitoring and and underground water systems. metering of takes at Regional Council Non-point discharges fi lter through level is insuffi cient. Water can be the soil, and run off to water tables and allocated as a fl ow rate or as a volume aquifers. We often know little about that can potentially be taken annually, how long they take to end up back in a but monitoring how much water is
15 STAKEHOLDER IMPACTS
Who are the stakeholders and how are they affected?
Stakeholders Problems Key problems with the current framework as or mix of perceived by each stakeholder problems
Environmental The quality of water is not managed adequately, including discharges from non-point interests sources e.g. run-off. Also the current framework manages water in a way that is often disconnected from community values and priorities. This means that environmental and in-stream values are not always well protected. Defending these values is becoming ever more expensive as the process becomes more litigious. Over allocation at times means river fl ows are depleted and groundwater levels are reduced. This exacerbates quality problems associated with discharges and concentrations of contaminants in the water.
Recreation and There is no long-term strategy or policy framework to maintain and improve freshwater quality. instream interests The current framework fails to appropriately assess the need for community use for recreation and in-stream requirements of water, bundling these together rather than making each of them transparent, resulting in community values sometimes being traded off as environmental needs are compromised. Community in-stream interests are at risk due to the quality and quantity issues arising in some catchments. There is limited guidance on how to address multiple values (e.g. community vs economic) in planning.
Irrigation interests There is an inherent risk of water supply, as part of a natural system affected by weather variability. This is not well handled. including storage Because of the uncertainty surrounding the duration of consents and water reliability, irrigators are unwilling to invest in irrigation schemes without a community or Government underwrite. The current framework does not provide for a strategic assessment of future water opportunities and options. Furthermore, security of existing or future supply is diffi cult to guarantee, which impacts negatively on investment decisions. Consents given under the RMA currently cannot separate access to water from the local effects of ‘take’ and ‘use’. This effectively ‘locks’ up water that could be used through transfer to another user without compromising environmental standards. The time and cost of existing transfer processes are signifi cant, which makes temporary transfers impractical.
There is insuffi cient resource and knowledge to strategically assess future water Central and opportunities and options. The ability to do this could avert future water crises. Regional The current situation promotes a generalised approach to water management, which fails Government to recognise specifi c water issues at catchment level for each stakeholder. Administration is becoming expensive as we approach full allocation, and as management systems are implemented to address situations of over allocation. Legal challenges are common. There is low knowledge of the actual volumes being abstracted, in part because of insuffi cient metering of takes which increases the chances of catchments being over allocated. Consents given under the RMA currently cannot separate access to water from the local effects of ‘take’ and ‘use’, which effectively ‘locks’ up water that could be used through transfer to another user without compromising environmental standards. There is limited guidance on how to address multiple values (environmental, economic, cultural, in-stream, national and regional) in planning. A lack of national guidance, together with different pressures across the regions for water has resulted in regional variance of planning effectiveness. Inadequate funding is another constraint preventing councils doing something more or better.
16 STAKEHOLDER IMPACTS
Stakeholders Problems Key problems with the current framework as or mix of perceived by each stakeholder problems
Municipal supply The costs associated with improving raw water quality, when water quality declines, are being met by the user at the downstream point of take, rather than upstream dischargers who create the problem. It is difficult to properly assess future opportunities and options for use of water e.g. security of supply for growing populations in high-demand catchments. There is a need to be able to ‘future-proof’ water supply for increasing populations.
Iwi The current framework in many cases has proven to be unable to incorporate customary rights under the Treaty of Waitangi into local water allocation and use. There is a desire for mahinga kai species and habitats to be protected which is diffi cult under existing arrangements. Iwi rights under the Treaty of Waitangi in respect of freshwater resources have yet to be resolved for many catchments. Iwi have concerns over future access to water in water-short catchments where this may restrict the ability of Iwi to develop their land currently leased out but to be returned after claim settlements. Iwi have concerns over long-term strategic planning and current use of the resource particularly in respect of maintaining and improving quality of the resource where this may restrict the ability of Iwi to develop their land.
Hydro and other The current framework does not provide a way to properly assess strategic water power generators opportunities and options across New Zealand or within a catchment. The current framework results in a high level of competition between existing users and new users resulting in expensive litigation. It also fails to provide long-term security of supply and therefore impacts investment security and decisions. There is limited national guidance in respect of national benefi ts of hydrogeneration relative to other values for local decision making.
Industrial It is very costly and impractical to transfer water to higher value uses. users Beyond living within resource consent conditions, there are no incentives to improve discharge quality; and no incentives to be more effi cient with water consumption.
New users There is very limited availability for new users who want access to water in water-short and potential catchments. The cost of accessing entitlements from existing land owners is often investors prohibitive. There is concern that some new allocations are being made that will not be able to be supplied due to over allocation of the resource.
All stakeholders The current framework allocates water on the basis of existing traditional uses rather than the best current/future use. There are major concerns about the deterioration of the quality of our water resources despite regional planning and other government interventions. A lack of knowledge about some aspects of our freshwater resource means the assessment of future opportunities and options cannot be carried out. The current framework has no way to assess value, so water doesn’t go to the highest value use. Water allocation is based on effects management of the resource (with limited knowledge of aspects of the resource, particularly regarding quality and limited national guidance) which impedes longer term strategic planning. Many regional plans do not specify allocation limits, so how much resource is available for use is not clear.
17 THE VISION
The Best Use Solution
The Business Council proposes a Best Use Solution using a mixed statutory-planning and market-based approach to manage surface and groundwater resources in each catchment.
This combined solution will provide a sustainable approach to both the quantity and quality of water management. It takes into consideration: public interest values, stock and fi refi ghting needs, the aquatic ecosystem, municipal supply, Iwi, recreation, irrigation and other industrial uses, and power generation. It achieves highest value actual use of the water available for commercial use through transferability.
THE KEY ELEMENTS: Measuring and monitoring (consistent and timely record keeping and transparent reporting on entitlements, Statutory planning allocations, quality, quantity, transferring, water and Management of allocations and effects (unbundling contaminant accounting) take and use consents, access entitlements) Improved quality management tools Consumptive use shares (not absolute amounts) Voluntary transfer of entitlements.
Best Use Solution: Managing Water Quantity and Quality
Managing Water Enabling Policy and Planning Access and Monitoring/Metering Transfer Environmental Effects
Central Government Water Access Register Water Water Use Regional Council Entitlement of Water Access Accounts Monitoring Entitlements
Register Regional Council Resource Consents of Consents Monitors Compliance Integrated Catchment Management Plan Register of Contaminant Contaminant Contaminant Contaminant Discharge Discharge Discharge Accounts Entitlement Monitoring Entitlement
Note: see page 26 for a more detailed presentation of The Best Use Solution.
18 THE VISION
Structure and features of the Best Use Solution
Policy and ALL WATER ALLOCATED TO FOUR PRIMARY POOLS have been developed Planning PRIMARY POOLS for Lake Taupo. The Best Use Solution Permitted New Integrated Aquatic In-stream, Activity Pool Public Use Consented integrates both Ecosystem e.g. stock Catchment Sustainability Pool Pool Use Pool quality and quantity drinking water e.g. recreation Management Plans management. At a regional level, Separation into four the catchment is the CONSENTED USE POOL primary pools fundamental management In-stream and abstractive All water in a catchment unit. Under the Best Energy Production will be separated into Use Solution system, Municipal e.g. run of river Other Uses 1 Other Uses 2 Water Supply hydro, storage e.g. irrigation e.g. fi sh farming four primary pools: Regional Government will diversions be required to prepare Aquatic Ecosystem Integrated Catchment CASE STUDY: ALLOCATION OF CATCHMENT WATER Sustainability Pool CURRENT WATER ALLOCATION Management Plans (ICMP) Permitted Activity following the National Pool (stock and Policy Statement. individual drinking Management through water needs) ICMPs would involve: In-stream Public Use national compliance: Flow River Pool (recreational complying with national use), and policy statements and/or Consented Use Pool national environmental Jul Aug Sep Oct Nov Dec Jan Feb Mar Apr May Jun (community, energy standards setting Date or commercial use). minimum fl ows, process Unallocated - Availability for any purpose is Uncertain Individual Domestic & Stockwater takes Unused Consents to take: Difficult to Transfer Aquatic Ecosystem for setting assimilative Used Consents to take The key features are: capacities, cultural in- The volume able to stream fl ows, drinking BEST USE SOLUTION WATER ALLOCATION be taken from the water quality standards consented use pool and other factors is capped to an periodic, whole- agreed limit. This of-catchment will better protect
assessments to ensure Flow River in-stream and compliance, monitor ecosystem pools. and provide information The consented on the resource use pool can be Jul Aug Sep Oct Nov Dec Jan Feb Mar Apr May Jun balancing community Date subdivided into Unused Consents to take: Available for Transfer Instream - recreation, cultural, public uses sub-pools including interests: how cultural, Used Consents to take Aquatic Ecosystem economic, social and Individual Domestic & Stockwater takes one for domestic and municipal environmental interests • Allocation of entire fl ow regime. in the resource will be supply, one for • Identifi cation of water available for transfer. appropriately balanced energy production, to achieve the most • Improved protection for in-stream interests and ecological needs. and other generic sustainable method of pools for other uses allocation such as irrigation or farming. The water supply reliability allocating all the water in the catchment integrating sustainable management of in each pool and sub-pool will vary to to four ‘pools’ to refl ect this balance quality and quantity in a catchment. appropriately refl ect national, regional defi ning the catchment assimilative An ICMP has been developed for the and local priorities. This will provide capacity Motueka Catchment in Tasman covering reasonable certainty for commercial quantity. Quality cap and trade tools investment. 19 THE VISION
Structure and features of the Best Use Solution
Managing Water Access weather patterns and resulting Proposed Variation 6, addressing water and Environmental Effects riverfl ows. management in the Waikato River. The granting of water access The key features are: entitlements would consider reliability Defi ning water access entitlements The water take consent grants of supply. The proposed solution treats access permission to build and operate a to freshwater separately from its take Rules would clearly outline voluntary structure to physically take water. and use. transfers which are permitted The water take consent manages This is achieved by ‘unbundling’ the activities and those transfers which site-specifi c local effects of the take. entitlement to access water from the are restricted discretionary activities. These effects are currently managed current ‘take and use’ consent. The An entitlement that is not being through conditions contained within cumulative quality effects of taking used will still be considered ‘used’ if consents to take water; and this water are managed independently of it is required to meet a future need, would continue. the localised effects of its abstraction, or another purpose. However, the The water use consent manages use and return. Best Use Solution allows for the site-specifi c effects of water use. Key features: immediate, temporary and voluntary The consent conditions are focussed transfer of that entitlement for a The actual physical amount of water on managing the downstream effects defi ned period. to be taken under the current consent of water use and encouraging structure is ‘unbundled’ from current effi cient use. ‘bundled’ take and use consent Defi ning water consents Neither the take nor use components framework. The ICMP would specify how site- of the resource consent would specify specifi c effects will be managed through A right to access water for taking, the actual amount of water which will the appropriate consents (to take, dam, termed a ‘Water Access Entitlement’, be taken. This information is now to be discharge, and use water). is a secure property right available for held in the water access entitlement a 35-year-term, with rights to renew The components of the resource Dam and discharge consents are for 35 years. consent that deal with take and use are separated, and simplifi ed by narrowing unchanged. Water access entitlements are their scope (see fi gure below). All signifi cant freshwater extractions transferable. The ICMP would This is a further extension of the and point discharge returns shall defi ne the terms and conditions by separation specifi ed by Environment be measured. which voluntary transfer of access Waikato in its Waikato Regional Plan entitlements could occur.
The entitlements Key Changes to Resource Consent in Best Use Solution represent a proportional share of the freshwater resource in a catchment Water Take and Use Consent Dam Discharge made available for taking Covers the amount you can take, plus the location Consent Consent you can take it from and how you can use it in the ICMP, rather than as a ‘guaranteed’ Current system Current volume or fl ow rate. The entitlements for the Grants permission to access a share of a water body
amount of water (either Water Access Entitlement Grants permission Grants Grants permission to volume or fl ow rate) to to operate a water permission physically dam or discharge be altered in accordance take structure to use water with changes in scientifi c Consumptive Flow Rate Water Take Water Use Dam Discharge Use Share Share Consent Consent Consent Consent knowledge, the application of technology, or available water Readily transferable within Proposed system Proposed These consents are location-specifi c rules defi ned in the Integrated quantities e.g. to take Regulatory process required to make changes Catchment Management Plan into account different
20 THE VISION
Transferring
Transfers and water accounting The voluntary transfer system for water access entitlements and assimilative capacity entitlements must be transparent for all users and stakeholders. All voluntary transfers need to be easily verifi ed by an independent third party, as demonstrated by the Opuha dam and registry scheme, in Canterbury. Voluntary transfer of water operates successfully within irrigation schemes at the current time. Establishing a registry will provide the mechanisms for matching up potential transferrers and transferees, and a transparent method for determining how much water is transferred and to whom, and for how long while ensuring abstraction does not exceed allocation.
Key elements of water record keeping would include: water accounts set up for each registered water access entitlement and assimilative capacity entitlement all allocation credits and debits recorded real time update and online access double entry recording system water accounts consolidated to catchment level and balanced annually recording systems for managing transfers of water access entitlements and assimilative capacity entitlements to manage quality.
21 THE VISION
Structure and features of the Best Use Solution
Managing water quality Key Extension of existing tool The mixed-planning and market solution adopts the quality management tools of our Existing tool current freshwater management system and introduces tools to manage the adverse New tool cumulative effects.
Tools for management of effects relating to quality
TOOL MANAGEMENT FOCUS RELATIONSHIP TO QUALITY
CONSUMPTIVE USE SHARE Manages cumulative effects of Placing a limit on this share i.e. the cap on consumptive use from groundwater allowable volume of water removed per year sources. from a catchment – protects groundwater and surface water. A catchment’s assimilative capacity is dependent on the size of this cap so total volume of water has to be defi ned alongside setting the assimilative capacity limit.
FLOW RATE SHARE Manages cumulative effects of takes and This share is based on the limit on the total damming on the fl ow regime of rivers flow rate able to be taken from a river and streams. This is required in order to protect the environmental and in-stream flows.
WATER USE CONSENT Manages effects of use on the water Specifi c conditions on use can be developed resource that receives drainage water. to suit particular circumstances such as: • land use changes • resultant downstream effects on water bodies receiving discharges or drainage.
WATER TAKE CONSENT Manages site-specifi c local effects This tool specifi es conditions relating to effects (excluding effects on fl ow regime). on adjacent water takers, maximum rates of take, or structure-specifi c conditions, like fi sh screen details.
DISCHARGE CONSENT Manages effects of discharge on water Specifying the water quality of point discharges is bodies that receive the point discharge. an incentive for higher standards. (Total discharge limits from point and non point sources in a catchment will be based on assimilative capacity limits.)
CAP AND TRADE Manages the cumulative effects of land This mechanism specifi es: MECHANISM FOR POINT AND use on water bodies receiving point and • the target quantity (or limits) of contaminants NON-POINT SOURCE non-point source discharges. in the water source DISCHARGES • the constraints on discharge or run-off levels as determined by the community. This tool can be used to reduce the overall cap over time to reach a specifi c goal.
LAND USE CONSENTS Manages how land is used to minimise Currently the major tool available to manage adverse effects (restrictions on specifi c quality, voluntarily tradeable assimilative land uses or intensifi cation). capacity limits should enable Regional Government to manage quality with fewer direct restrictions or controls on land use.
22 THE TRANSITION
Improvements needed to effect the Best Use Solution
Respon- Currently in Framework sibility development adopted 2010 2011 2012 2013 2014 2015 2016 RMA changes Amendments drafted & passed National Policy NPS for freshwater Further NES developed e.g. assimilative capacity Statements and NES ecological National fl ows and levels Environment NES metering Standards Priority list of Priority catchments catchments gazetted Governance for example, Crown and Waikato Tainui Approval in Principle regarding claim over Waikato River ICMP Guided by NPS
Pilot ICMP Funding of pilot ICMPs and guidelines Delivery of pilot ICMPs
Shared services Establishment including registry Ongoing use User Pays portion of registry Metering Guided by NES
RESPONSIBILITY KEY Central Government Regional Government Water Users
The Best Use Solution National Policy Statement point source discharge standards requires key improvements Councils will be required to develop methods, processes or technologies at Central and Regional Integrated Catchment Management Plans to implement the water allocation Government level. consistent with NPS and NES provisions solution (e.g. allocation zones, as a matter of national signifi cance within metering and monitoring standards, Changes to the Resource a set time for critical catchments. defi ning transferability as permitted Management Act National Environment Standards activity within allocation zones) Resource Management Act changes National Environmental Standards required exemptions from standards where would include an amendment enabling by the proposed solution include: appropriate unbundling the water access entitlement, default (or “interim”) fl ow rate(s) comprising fl ow rate shares and the nature of rights afforded by each set aside for aquatic ecosystem consumptive use shares, and addressing entitlement as to duration sustainability and in-stream public the following: the circumstances in which the rights uses, together with default limits on the may be exercised (with respect to the rights of consent holders to transfer amount of water available for taking other shareholders) all or part of interests in water (fl ow rate and consumptive use) protection of the rights of existing the circumstances in which the water methods for determining how much of a resource consent holders, by way right can be exercised (with respect to water resource is to be assigned to the of a grandparenting system with other consent holders and duration) aquatic ecosystem, in-stream public use provision for a ‘proportional haircut’ (including recreational and cultural uses), protection of the rights of existing where necessary to live within minor individual use and consented use resource consent holders (and land established water constraints where a pools and sub-pools owners), by way of a grandparenting catchment may be over allocated. default (interim) limits on catchment system where access entitlements would Public Participation assimilative capacity for contaminants normally be allocated to the landowner Ongoing access to funding for default point source discharge a process to assist Regional environmental and other community standards - minimum or maximum Councils to effect Integrated groups should be available enabling as appropriate (e.g. contaminants) Catchment Management Plans these groups to fully participate in the which have not been developed methods for determining a catchment’s development of NPS, NES, regional plans, within the nominated timeframe. assimilative capacity for contaminants, ICMPs and resource consent processes. and for determining point and non 23 THE TRANSITION
Improvements needed to effect the Best Use Solution
Governance periodic assessments to monitor and development of an expert facility to monitor, We strongly recommend that Government determine ecosystem health and water report and run a water and contaminant and Iwi develop an agreement on quality, verify catchment management discharge entitlements accounting system, ‘governance’ of New Zealand’s freshwater outcomes, and measure/monitor as a shared service with running costs resources with respect to customary issues consented extractions and returns. met by the Regional Councils. with priority for water stressed catchments. ICMPs fall into the regional plan Metering Integrated Catchment category of the RMA, and as part of this Regional Government require improved and Management Plans institutional framework, ICMP should increased metering and monitoring of all Initially a few pilot ICMP’s would undergo a review process initially after ten signifi cant takes and discharges consistent be developed to provide tools and years and then every 20 years after that. with the NES standard metering. guidelines for Regional Councils in Establishment of Shared Services: stressed catchments. The plans Central Government would fund and would ensure all water resources had establish a national registry and facilitate the
Prioritisation of development of ICMPs Key The prioritisation of catchments requiring development of Integrated Catchment High Priority Management Plans would follow the process outlined below: Medium Priority Low Priority No Change
Initial Catchment Transition Steps after RMA changes, once National Policy Statement and Consented Use National Environment Standards are in place. Pool (CUP) allocation
Areas where CUP is • Establish or review existing ICMP setting minimum fl ows, risk bands, over 100% allocated: zones and assimilative capacity/limits. • Proportional “haircut” for all existing CUP users based on new limits if lower Allocation limits have not than existing allocations for quantity and a ‘sinking lid’ for contaminants for quality. been set, high demand for water • Unbundle consents (consents to take and use from the physical water entitlement). likely over next fi ve years. • Transfer of water access and contaminant discharge entitlements then allowed on volutary basis. Likely to include Canterbury, Waikato, Otago and the Nelson/ Marlborough area.
Areas where CUP is over • Transition from fi rst-in, fi rst-served approach to substantive evaluation of 70-100% allocated: competing values of applications. Allocation limits are not yet set, • Establish or review existing ICMP, setting minimum fl ows, risk bands, zones and there is high demand for water and assimilative capacity limits etc. likely over the next fi ve years. • Make decisions on strategic allocation of unallocated water:- • option to hold, tender or transfer remaining 30% of water (e.g. ‘earmarked’ water for a future new town or planned industry), and • decisions made in accordance with rules specifi ed in ICMP. • Unbundle consents (consent to take and use from the water access entitlement). • Transfer of entitlements allowed on voluntary basis (may include allowing temporary transfer of water held for future strategic uses and assimilative capacity for contaminants).
Areas where CUP is under 70% • No immediate change: fi rst-in, fi rst-served system. ICMP to be in place prior to allocated and may reach 70% the allocation of water available for use approaching 70%. allocated over next 10 years.
Existing Water • No change is proposed. Conservation Orders. • Improved and increased metering and monitoring of all takes, discharges and quality consistent with the NES.
24 THE TRANSITION
Costs and Risks - Who Pays the Cost? Who Holds the Risk?
of cost distribution as detailed in the table following.
Risk Entitlement holders bear the risk from the natural variability in supply as a result of climate and/or changing science. Risk will be managed through a reduction in the amount of water available for abstraction through daily setting of fl ow-rate allocations and annual setting of consumptive use allocation. Risk may be mitigated for users by holding access entitlement classes with high supply reliability. Less reliable water can be combined with storage to manage the risk.
Compensation for water users from major policy and planning changes unforeseen at the time of consent The Best Use Solution needs an The Best Use Solution costs are applied, approval would become effective after up-front investment. The alternative and are appropriate, to those whose the fi rst ICMPs have been reviewed is an even higher price in lost responsibility it is to deliver their part of probably 10-30 years away. economic, social and environmental the solution – at national, regional and Compensation would not be paid if a opportunities. user level - following the existing pattern change in allocation pools is the result of a change in scientifi c knowledge, or RESPONSIBILITY WHO IS RESPONSIBLE AND WHO PAYS? discovery of a new contaminant.
Compensation would be paid (by Regional Council) if a change in allocation Development of National Policy Statements and National pools is the result of change in community Environment Standards values (e.g. desire for greater in-stream Costs associated with developing shared service national water public use benefi ts where this change accounts and establishment of registry exceeds a threshold). Development of regional policy statements and mandatory Integrated Catchment Management Plans Compensation would be paid (by Central Government) if a reduction in Submissions on proposed policies and plans the quantum of water available for Applications for water access entitlements and consents taking, or of its reliability, is due to a new NPS or NES or other Central Ongoing compliance metering and monitoring costs Government policy change becoming Costs associated with operating water accounts operative.
Costs associated with transfer of water access entitlements Compensation could include direct payment, remedial measures, an offi cial The main additional operating cost of the Best Use Solution is the national apology, or help with developing water accounts. infrastructure to mitigate a reduction The costs associated with the development of Integrated Catchment Management Plans in the Consumption Use Pool. have been indicated to be high for some regions, hence the development of shared services and pilot ICMPs and guidelines will help to offset some of these costs.
25 SUMMARY
The Best Use Solution
Managing Water Enabling Transfer Monitoring Policy and Planning Access and (National Registry) and Metering Environmental Effects
Central Government: • Iwi/Government water governance agreement covering customary use and Water Access development opportunities by catchment • National Policy Statement Entitlement • National Environmental Standards Consents to legally access water − flow-rate • RMA amendments for unbundling of water and volume. access entitlement and risk sharing mechanism. Two separate tranferrable entities: Consumptive use share (per CUP sub-pool) Regional Council: • actual volume allocated to sub-pool determined on annual basis • Regional Policy Statement • addresses cumulative effects of water use • Regional Plans • particularly important for groundwater takes.
Flow-rate share (per CUP sub-pool) • actual flow-rate allocated to sub-pool determined on a daily basis Integrated Catchment • reliability of supply managed through this Register Water Management Plan mechanism of Water Access Water Use • particularly important for surface water takes. Accounts Monitoring Defines one or more allocation zones for the Entitlements catchment.
Sets up the Primary Pools – divides up all of the flow regime between the full pools defining water allocation limits. • Aquatic Ecosystem Sustainability Resource Consents • Minor Individual Uses • Public Use In-stream Consents to operate a water take structure and (including customary use) to use water. • Consented Use Pool (CUP) Register Local non-specific aspects of taking and using Regional Council Sets up the Consented Use Pool – creates water are controlled through these mechanisms: of Consents Monitors Compliance sub-pools based on supply reliability and may reserve a sub-pool for a specific water • Take consent use (e.g. municipal) • Discharge consent • Dam consent Key components relating to CUP • Water use consent. sub-pools include: • consumptive use shares defined and number • flow-rate shares defined and number
Key components relating to contaminant Register of Contaminant discharge include: Contaminant Discharge Contaminant Contaminant Discharge • catchment assimilative capacity (CAC) defined Entitlement Discharge Accounts • define and allocate shares in CAC Monitoring • all sources of contaminant (point and non Entitlements point discharge) accounted for. Entitlement to legally discharge contaminants into water. Defines Rules for: • voluntary share transfer Transferable entity. (water and contaminant) • daily setting of flow-rate available for Proportional share in total catchment allocations contaminant discharge as established by the • annual setting of consumptive use available catchment assimilative capacity. for allocations • allocation decisions relating to remaining Catchment limits can be set as a reducing cap water - who makes them, and process for over set time and reflected in actual limits and value-based decision making the proportion allocated to shares on an annual • ‘holder’ of access entitlements for final 30% basis. of CUP where this is not yet allocated • specific water and contaminant accounting procedures
26 SUMMARY
Structure and features of the Best Use Solution
The major improvements proposed in introducing a new tool to put It is important to note that “ the new model include: a cap on point and non-point while the Best Use Solution is contaminant discharges into the adopting integrated catchment receiving water body. With other a fresh approach to water management plans for water new features, this will allow a “cap planning at a regional level and trade” system to manage these management, many of the non-point or point discharges to live components are a wider separating the water access within the assimilative capacity of entitlement from resource take and use our waterways application of current consents so that surplus allocations can be transferred to other users establishing a registry to facilitate water practice and tools used accounting and quality management proportional shares of the water available and voluntary transfer of water. in New Zealand and for taking in order to manage for different moving to a value-based natural variability in water availability internationally.” allocation from the fi rst-in, fi rst- served approach once a specifi ed improving monitoring and metering of proportion of the available water takes and assimilative capacity limits has been allocated.
27 SUMMARY
The Best Use Solution
What is Needed to Make it Happen
National Regional Water users These actions are needed at Central These actions are needed at Regional These actions are needed by water users: Government level: Government level for all catchments Accept greater assignment of risk Setting a requirement for measuring deemed to be in need of the arising from future changes in the and monitoring (consistent and timely Best Use Solution: amount of water actually available for record keeping and transparent Undertake Integrated Catchment existing consented use or changes reporting on entitlements, allocations, Management of surface and in our knowledge of the science of quality, quantity, transferring, water groundwater resources – to manage water use. and contaminant accounting). the cumulative effects of water takes Use unbundled consents to take and Clear timetable for addressing priority and nutrient inputs. use no more than the amount of water catchments and suspending further Set environmental baselines and they are granted access to via the fi rst-in, fi rst-served applications for allocate the remaining water to proportional water access entitlement. these catchments. recreational, stock water, customary, Use the enhanced transfer mechanism Clear view from government on generation and commercial uses. to access water and assimilative value of water for all uses; strategic Assess the relative value of in- capacity requirements for a commercial long-term view, and resource stream use to facilitate allocation activity. This will be the most effective management (National Policy decision-making. approach as the resource reaches its sustainability limits. The Business Statements – including transparent, Agree policy settings which encourage Council proposal applies a market- statutory-based catchment water use effi ciency and innovation based mechanism to the pool of water management planning, as the basis in urban and rural areas. of water allocation and contaminant made available for taking. The intention Move to a value-based allocation from management at the operational level). is to achieve better sharing of a limited the fi rst-in, fi rst-served approach, resource among commercial uses, once a specifi ed proportion of the helping ensure water and contaminant available water has been allocated discharge entitlements go to the (say 70%). highest value uses. Establish rules which minimise the transactions costs of transferring water permits and enable an effi cient, Taking The Next Step open transfer system to operate, This project report details the major while protecting the statutory problems, the concerns of all parties, provisions made for environmental and a proposed solution which will and other public benefi t outcomes. work best for New Zealand. Provision of knowledge, systems The Business Council has enjoyed and tools (National Environment Provide water accounting to track widespread participation in, and Statements) for effective planning and who has entitlements and who has support for, the project and its broad management (cumulative effects, taken, used, returned or treated recommendations. assimilative capacity standards, water. This information is needed We will now consult with politicians, environmental base lines, metering by the Council and stakeholders councillors and their advisors on and monitoring). for planning, monitoring, trading, environmental management and the Best Use Solution and establish Clear defi nition of a secure water commercial water-use management. support for the development of a access entitlement and its duration. pan-sector agreement on the Best Undertake metering and monitoring Funding all aspects of establishing Use Solution for New Zealand’s water of takes and discharges to water the shared services required including problems, including draft legislation and common reporting of takes and the national registry. and required changes to policy tools. discharges to water.
28 SUMMARY
The Best Use Solution for New Zealand’s Water Problems
These are New Zealand’s principal water problems, the solutions and benefi ts which can be delivered by the Best Use Solution arising from Business Council research:
KEY DEFINITION PROBLEM SOLUTION BENEFITS QUANTITY Freshwater water resources in the Tools to measure and manage Economic incentives to conserve water, or populated and intensely farmed areas water takes and fl ows and maximise output per unit of water taken from of NZ will soon be fully ‘allocated’. enable water use transfer. increased transferability. Limited ability to transfer surplus Improved metering and monitoring will allocated but unused water. enhance quantity management.
QUALITY Public concerns over declining Cap and trade for contaminant Control of the cumulative effects of water quality and clean-up costs. discharges, to operate within the takes and contaminant discharges on Many water users have concerns limits of capacity of waterways lowland streams and lakes. about quality (including nitrogen, and groundwater to assimilate them. Capping and transferability for better management microbes, algal bloom and mercury A benefi t for users that reduce of contaminant impacts. levels). contaminant discharge or run-off. Improved metering and monitoring to provide better information for users and planners.
EFFICIENCY Poor incentives to improve use or Pricing through tradable entitlements Effi cient transfer of water takes and contaminant effi ciency because users don’t pay will provide incentives for more limits to the highest value uses. Increased for higher reliability and use-it or effi cient use. economic benefi ts from consented but unused lose-it rules encourages ineffi cient use. water being made available for taking.
PLANNING Politicised process with little Urgently complete policy tools e.g. Explicit provision for water allocation for pubic Central Government guidance; NPS, NES to provides greater uses, such as Iwi, customary and recreational lack of tools for setting certainty of what is available to take uses. Value-based water allocation planning environmental parameters. Decision- and guidance on various uses. that takes account of national objectives in addition making process increasingly litigious. Extend use of Integrated Catchment to regional and local objectives. Public access to Management Plans. current, comprehensive water accounts. In particular, information on under-utilised water access and contaminant discharge entitlements readily accessible.
ALLOCATION Few regional plans have set allocation Allocation of all water to one of four Improved protection of the aquatic ecosystem, limits. Lack of monitoring and metering primary pools. Only one of these pools through clearly defi ned allocations to each pool, of resource and use. is for consented use where transfers improved transferability of entitlements which are allowed. Metering required for all means reduced costs for reallocations. signifi cant takes.
RISK Every user wants access to Improve knowledge of reliability Improved management of risks to the maximum allocation with the highest for greater certainty of supply. environment and to water users through the use reliability. In times of shortages, Require users to take proportional of zones, reliability bands and proportional ecological impacts can dramatically shares in water available for taking. shares. Appropriate compensation for takings increase. The current system does The majority of the risk of changing after transition to the new framework. not refl ect the natural variability in volumes is then with the users, as water fl ows. a result of variability in availability.
INVESTMENT Uncertainty around honouring A 35-year+35-year-term for access Greater certainty about the quantum and reliability existing take levels and length entitlements to water should of water made available for taking and the duration of consents affects long-term enable access holders to underwrite of entitlements. investment because past long-term investment (irrigation “promises” may not be able to schemes or hydrogeneration). be kept. Regional Councils manage uncertainty by keeping consent durations to the minimum.
LONG-TERM First-in fi rst-served gives no Move to a value based allocation Ability to ‘earmark’ water set aside for future STRATEGY opportunity to take a strategic with long-term strategic focus on requirements without preventing current use of view; current assumption is that clean future demands on a catchment the water. Temporary other uses of this water water will be always available in taken by Regional Government with are possible in the intervening period. catchments even once full allocation Central Government guidance. has occurred. Water continues to be used but can be earmarked for future use (new town, new industry).
KNOWLEDGE Limited knowledge about some Ongoing and strategic investment Improved knowledge of resource for better aspects of water resources (e.g. who in development of knowledge of sustainable management particularly knowledge uses how much and where, what are water resources which can be of the value of alternative uses and the use and the assimilative capacity limits) shared, particularly in regions and quality of the water in our rivers, streams makes management, decision making catchments short of water. and aquifi ers. and planning diffi cult. 29 Your Feedback is Welcome
This project report details the major problems, the concerns of all parties, and a proposed solution which will work best for New Zealand.
We welcome your input and feedback.
To contact the Business Council regarding the Best Use Solution project:
Telephone: 64 9 525 9727 E-mail: offi [email protected] Facsimile: 64 9 580 1071 www.nzbcsd.org.nz www.waterfuture.org.nz Project Leader: Heather Stonyer NZBCSD Chief Executive: Peter Neilson PO Box 1665, Shortland St, Auckland 1140, New Zealand
30 KEY READING
Key Reading and Bibliography
Government sources on the issues
Current water allocation issues. MAF www.maf.govt.nz/mafnet/rural-nz/sustainable-resource-use/water-effi ciency/future-water-allocation-issues/ future-issues-in-water-allocation-01.htm#P19_441
Freshwater for the future.MfE www.mfe.govt.nz/publications/water/freshwater-future-supporting-doc-april06/html/index.html
Water allocation a strategic overview.MfE www.mfe.govt.nz/publications/water/water-allocation-a-strategic-overview-may01.html
Property Rights & Environmental Policy. Treasury www.treasury.govt.nz/publications/research-policy/wp/2003/03-02/13.htm
Improving water allocation framework. MED www.med.govt.nz/templates/MultipageDocumentPage_24843.aspx
Bibliography
Snapshot of water allocation. MfE, 2006. www.mfe.govt.nz/publications/ser/snapshot-water-allocation-nov06/html/page3.html
ShapeNZ national online panel, Water Issues Survey 26 August 2007. Sample size 1,150. Weighted to provide a representative sample of the New Zealand population compared with the 2006 census and 2005 general election party vote. Maximum margin of error at 95% confi dence level +/- 2.9%. www.shapenz.org.nz
Environment Waikato. www.ew.govt.nz/Environmental-information/Rivers-lakes-and-wetlands/How-healthy-are-our-rivers/Waikato-River/Downstream- change-to-water-quality/Changes-in-nitrogen/
ECAN data sourced from Environment Canterbury.
World Business Council for Sustainable Development. www.wbcsd.com Source for all statistics and defi nitions for water footprint. www.waterfootprint.com
Environment New Zealand 2007, MfE, 2007. www.mfe.govt.nz/publications/ser/enz07-dec07/chapter-10.pdf.
Contribution of land based industries to New Zealand's economic growth. MAF, 2003 www.maf.govt.nz/mafnet/rural-nz/profitability-and-economics/contribution-of-land-based-industries-nz-economic-growth/
Sustainable Fresh Water Management - Towards an Improved New Zealand Approach. Report prepared for NZBCSD by Aqualinc, 2008 www.nzbcsd.org.nz
31 FEEDBACK
Your Feedback on the Best Use Solution
From your perspective what are the best features of the existing freshwater management framework?
From your perspective what are the worst features of the existing freshwater management framework?
Does the Best Use Solution address most of the defi ciencies, from your perspective, in the existing freshwater management framework?
If not, what other suggestions would you make to improve the management of freshwater for yourself and all stakeholders in New Zealand?
Please return to: Best Use Solution New Zealand Business Council for Sustainable Development PO Box 1665, Shortland Street, Auckland 1140, New Zealand 32 DEDICATED TO MAKING A DIFFERENCE DEDICATED TO MAKING A DIFFERENCE
Level 3, Building 10 Tel: +64 9 525 9727 Corporate Offi ce Park Fax: +64 9 580 1071 666 Gt. South Road Email: offi [email protected] Penrose, Auckland 1140 Web: www.nzbcsd.org.nz