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Emu Swamp Dam Business Case Stage 1 Final Report 20170602

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Emu Swamp Dam Business Case Stage 1 Final Report 20170602 Southern Downs Regional Council Emu Swamp Dam Business Case Stage 1 Final Report June 2017 Executive Summary Introduction This report delivers a strategic assessment of the current and future need for an additional water supply in the Stanthorpe Region for urban, irrigation and regional development purposes. Previous historical work has identified the Emu Swamp Dam as the preferred option. Despite formal environmental approvals, it has not attracted the funding required for it to proceed past the preliminary stages of assessment in the past decade, however, it is the only option considered to date which has an existing environmental impact statement and associated environmental approval. Funding has recently been provided under the National Water Infrastructure Development Fund to investigate the current feasibility of the Emu Swamp Dam and to consider whether it remains the preferred option to meet the regional demand for urban and irrigation water. Previous reports have indicated that the Dam will require significant public investment if it is to proceed. The Southern Downs Regional Council has therefore determined that stage one of the feasibility study should be to undertake a strategic assessment of the present and future (out to 2050) urban and irrigation water supply needs and options to supply those needs including the Emu Swamp Dam project. In doing so, the approach aligns with, but goes slightly beyond, the Building Queensland Framework for major infrastructure development that identifies a Strategic Business Case including Investment Logic Mapping (Stage 1) as an initial requirement. Service need and context The Southern Downs region, in which the project is proposed to occur, is an important agricultural area that is actively seeking economic growth opportunities in the agribusiness, manufacturing and tourism sectors. It has land available for agricultural and industrial development and has good transport connections to the major population centres. These links may be further enhanced through the proposed Melbourne-Brisbane rail link. A range of stakeholders and previous reports identified water security in Stanthorpe and the wider Granite Belt region as a major constraint to future investment, regional development and economic growth. Stanthorpe has been subjected to water restrictions ranging from Permanent (230 Litres per person per day (L/p/d) target) to Extreme (140 L/p/d target) and currently operates with permanent restrictions in place, although SDRC has advised GHD that these restrictions are often not enforced. Horticultural and agricultural producers face periodic water shortages negatively affecting crop yields and influencing the potential to expand production. Slow population growth (0.4% per annum) has moderated urban demands for water. Income analysis shows that many urban residents would find it difficult to absorb a significant increase in water service costs. Recent projections show the current water supply for the Stanthorpe region is not sufficient to meet forecast urban water needs beyond 2036. Agriculture is the major source of employment in the region and is historically vulnerable to water insecurity. Any downturn in agricultural yields due to an extended drought is likely to have flow on effects for regional incomes and employment. Identifying appropriate options to meet future urban and irrigation needs is therefore critical to regional economic sustainability and liveability. Document review and gap analysis As part of this strategic assessment (Stage 1 of the feasibility study), GHD has reviewed more than 100 previous reports evaluating urban water security, irrigation and industrial water GHD | Report for Southern Downs Regional Council - Emu Swamp Dam Business Case Stage 1, 91/10289 | i demand and water supply options. This process indicated that there is a significant strategic reserve of water available (nominated for urban and industrial use) together with a historically accepted need for an additional urban water supply and demand for additional irrigation water. GHD has also reviewed the several alternative dam site options identified and analysed at a very high level in these earlier reports together with options to raise the existing Storm King Dam and construct additional weirs. Most reports were developed with an emphasis on Emu Swamp Dam and only this option was analysed in detail with other options being considered at a superficial level. Other than Emu Swamp Dam, there is limited information that enables an understanding of hydrological and engineering issues, risk and limitations or an analysis of cost comparativeness across alternative dam sites and dam heights. For most of the alternative dam sites, geological information in previous reports is at too high level to allow assessment or comparison of sites. As such, risks associated with potential excavation depths, failure planes, water tightness, erosion potential, and construction materials, all of which can significantly affect the cost of a dam, are a significant information gap. Distribution systems have only been designed for the proposed Emu Swamp Dam at pre-concept design configuration. None of the rest of potential dam options have information of pipelines routes, pump stations and storage tanks and associated costs required for the proposed system. Evidence ruling out the Ballandean dam site in earlier reports lacks clarity, even though it is arguably a more cost-effective dam site due to its superior terrain, shorter dam wall and potentially greater yield having lower surface area for a given volume and being lower down the catchment than Emu Swamp Dam. For example, issues arising from inundation of other major infrastructure are cited in these earlier reports as reasons not to proceed with the Ballandean Dam site without detailed description or analysis of the impact of such. Previous reports have also not adequately considered lower cost options such as raising Storm King Dam, pipelines from other dams such as Connolly or Leslie Dam coupled with integrated water supply management. Many of the assumptions used in previous reports underlying the extent of the need for additional supply are also questionable. Population growth has been significantly lower than predicted in original business cases as is current and forecast per capita water consumption and predictions regarding additional industrial demand for water have failed to eventuate. Significant assumptions have been made on the social benefits of an increase in the volume of urban water supply. While irrigator-expressed willingness to pay has been studied extensively, no commitment has yet been sought from irrigators to underpin an investment in irrigation supply infrastructure. Equally, the willingness of urban users to pay for additional water security has not been considered in previous reports. No analysis has been undertaken to date on the real and perceived impacts of permanent water restrictions on population growth and industrial development in Stanthorpe. Assessments of regional development have not considered the impact of water restrictions on tourism and the tourist experience. The option of greater surface water harvesting through increased on-farm storages to address demand for irrigation water has not been adequately considered in previous studies. Whilst previous studies have found that agricultural producers in the region have an appetite for additional irrigation water, the studies have not been sufficiently robust to enable a decision to be made on whether to proceed with the construction of the dam and associated distribution infrastructure for irrigation supplies, nor for an alternative option. This is largely due to the absence of any detailed assessment of the on-farm financial return from the use of additional irrigation water and hence economic viability of such infrastructure. ii | GHD | Report for Southern Downs Regional Council - Emu Swamp Dam Business Case Stage 1, 91/10289 Stakeholder consultation This Stage 1 strategic assessment has been informed by a structured process of consultation aimed at ensuring that stakeholders and the broader community were informed about project activities and given opportunities to be actively involved and contribute to understanding of needs. A project website was established and social media used to encourage participation in engagement activities: 2,551 people were reached through Facebook information sessions with 86 engaging in the update posts. Community announcements were broadcast over local radio and ads placed in local newspapers to encourage attendance at events. – Information sessions were held in key regional centres and email updates provided; 40 people attended the information session in Stanthorpe and 10 in Warwick. 137 irrigators and other water intensive industry and representatives in stakeholder lists provided by SDRC and the Stanthorpe and Granite Belt Chamber of Commerce were approached directly either by email or via telephone calls and invited to take part in an online survey, attend focus group discussions or engage in one-on-one interviews. An online water irrigation survey was used generating 12 responses Focus group discussions were held with eight irrigators and a further eight one-on-one interviews were undertaken with irrigators and other water intensive industry representatives. 150 local businesses completed the telephone survey. Government stakeholders across various local, state and national departments were contacted where necessary. GHD considers
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