SUSTAINABLE WATER MANAGEMENT SUSTAINABLE WATER MANAGEMENT: Securing Australia’s future in a green economy S ECURING AUSTRALIA’S FUTURE © Australian Academy of Technological Sciences and Engineering IN A greeN ecoNOMY The Australian Academy of Technological Sciences and Engineering (ATSE) A REPORT OF A STUDY BY THE AUSTRALIAN ACADEMY OF TECHNOLOGICAL SCIENCES AND ENGINEERING (ATSE) SUSTAINABLE WATER MANAGEMENT Securing Australia’s future in a green economy AUSTRALIAN ACADEMY OF TECHNOLOGICAL SCIENCES AND ENGINEERING (ATSE) Australian Research Council APRIL 2012 SUSTAINABLE WATER MANAGEMENT: Securing Australia’s future in a green economy Report of a study by the Australian Academy of Technological Sciences and Engineering (ATSE) © Australian Academy of Technological Sciences and Engineering (ATSE) ISBN 978 1 921388 20 0 This work is copyright. Apart from any use permitted under the Copyright Act 1968, no part of it may be reproduced by any process without written permission from the publisher. Requests and inquiries concerning reproduction rights should be directed to the publisher. Date of publication: April 2012 Publisher: Australian Academy of Technological Sciences and Engineering Level 1/1 Bowen Crescent Melbourne Victoria 3004 Australia GPO Box 4055 Melbourne Victoria 3001 Australia Telephone +613/03 9864 0900 Facsimile +613/03 9864 0930 Principal Authors: Dr Brian Spies FTSE and Professor Graeme Dandy FTSE This work is also available as a PDF document on the ATSE website at www.atse.org.au This project was funded by the Australian Research Council’s Linkage Learned Academies Special Projects (LASP) scheme. Design and production: Coretext, www.coretext.com.au Printing: Geon Group Australia Pty Ltd Cover: iStockphoto Disclaimer Use of the information contained in this report is at the user’s risk. While every effort has been made to ensure the accuracy of that information, the Australian Academy of Technological Sciences and Engineering does not make any warranty, express or implied, regarding it. SUSTAINABLE WATER MANAGEMENT Executive Summary This report explores a framework for sustainable water management in Australia that is able to adapt to future challenges through fostering the principles of green growth – improving productivity and economic prosperity as well as improved environmental and social outcomes. Water is vital for all aspects of life on Earth. It is a crucial resource underpinning Australia’s economy, society and environment. Many factors influence water security in Australia. These include population growth, environmental degradation, climate change and variability, rainfall, land use, pollution, institutional arrangements and demand for Australia’s exports, notably of natural resources and food. Sustainable water management will require technological innovation driving increased efficiency and productivity and enhanced environmental outcomes in order to balance economic, environmental and social issues. Sustainable Water Management: Securing Australia’s future in a green economy explores the linkages and interdependencies between the many roles, uses and sources of water in Australia, examines the vital role of water in maintaining national prosperity under key challenges, develops a systems model for water supply security and highlights the importance of scientific development and technological innovation in moving to a cleaner, greener economy. Crucially, the report sets out how green growth principles can be fostered to develop sustainable water management strategies able to adapt to future challenges in recognition of the interdependencies between water, the economy, the environment and society. The concept of green growth, as a core strategy for long-term sustainable development, emerged as a key priority at the United Nation’s first international Earth Summit in 1992, in Rio de Janeiro. Green growth implies growing productivity, prosperity and living standards while improving environmental and social outcomes and providing a framework for sustainable economic development that balances environmental, social and technological aspects. The core principle of green growth is that improvements in economic productivity should not come at the cost of natural resources, the environment or social wellbeing. A key challenge will be to achieve community-wide acceptance of green growth principles and shared responsibilities to achieve outcomes. The concept of green growth can be applied to water management strategies and government policy to achieve a balance between economic, social and environmental factors and to support the growth of new industries, bring technological innovations to market and position the country to capture green growth opportunities. Innovation, scientific development and new technologies will create jobs and export opportunities and address the decline in Australia’s productivity. Investment decisions will need to be based on a broader understanding of the externalities of water and energy use and the integration of social, environmental and economic factors. Water and its interdependencies Water plays a critical role in the Australian economy. Water policy is governed by a mix of State and www.atse.org.au Commonwealth legislation, as well as regulatory, legal and institutional frameworks. Water makes a substantial contribution to the economy and related environmental goods and ecosystem services can further boost economic activity. The Australian Academy of Technological Sciences and Engineering (ATSE) i SUSTAINABLE WATER MANAGEMENT Assessing the true value of this contribution is a challenge. Green growth outcomes could be measured through the provision of metrics from the integration of national water, economic and environmental accounts into a uniform accounting framework. Major water utilities are adopting sustainability strategies, based on triple-bottom-line analyses which will provide a useful starting point. Water cannot be considered in isolation. A systems dynamic approach can be applied to encapsulate the complex feedback mechanisms associated with the interactions between water, energy, climate change, population and agriculture. There are strong interdependencies between water and energy, food and the carbon cycle. Water is required for a broad range of energy systems – recent droughts severely impacted electricity production across much of eastern Australia. Electricity security and reliability would be greatly enhanced by conversion of thermal power plants to dry or hybrid cooling. Energy in turn plays a number of key roles in the water sector, as it is needed for construction and operation of water infrastructure, transport, treatment and distribution. Approximately 30 per cent of Australian household energy consumption is used to heat water and irrigation for agriculture consumes a substantial amount of energy. The development of alternative sources of water (such as desalination) often leads to significant increases in energy consumption. Biofuel production has led to competition for water resources, although next-generation biofuels offer opportunities for improvement. Population growth puts pressure on all resources, including land, water and energy. Technological improvements in energy and water efficiency, waste processing and recycling can help ameliorate potential ecological pressures from increasing population. Water demand and supply Water is crucial to human health and wellbeing, agriculture, industry, in the support of ecosystems and the environment, and in underpinning cultural and social values. It is consumed across all sectors of the Australian economy. Agriculture (predominantly irrigated agriculture) accounts for more than 50 per cent of Australia’s water consumption, with the remainder attributable to households, commercial and industrial uses (notably power generation) and the water supply industry. The main driver of urban demand for water and electricity is population – and increasing energy demand drives increases in demand for water. Rural demand is dependent to a large extent on climatic conditions and water availability. The Murray–Darling Basin (MDB) contains one-quarter of Australia’s agricultural land and it accounts for approximately 50 per cent of irrigated land and irrigated water applied nationally. The MDB provides an example of complex and competing demands within the economic-social-environmental nexus and the importance of appropriate basin management plans for equitable allocation of water resources and long-term sustainability. There are three broad categories of water sources – natural, recycled and manufactured. Most water sources are dependent on rainfall, which is highly variable over much of Australia. This variability is likely to become more extreme under climate change, further challenging supply planning and infrastructure. Seawater desalination is rainfall-independent and is being used as a reliable source of water. Australia’s variable rainfall is a key factor that often challenges the equitable allocation of water. Water supply is often insufficient to meet demand, particularly in times of low rainfall, in rural and urban areas. Water sharing plans should incorporate adaptive strategies that reflect the vagaries of climate and competing demands for water resources. During drought periods, demand reduction has been addressed by restrictions on how water is used. Utilities are diversifying sources of supply to include options of desalination and non-potable recycling (for example, recycled stormwater and wastewater).