Public Submission to Water Market Rules Position Paper

by Callandoon Water Supply Board:

Dated 12/8/08.

The Callandoon Water Supply Board (CWSB) has a Distribution Operations Licence (DOL). The CWSB delivers 5406 ML of supplemented water plusNominal Volume 8834ML of unsupplemented water to 7 irrigators and 201ML stock and domestic water to 17 properties. The CWSB has a 2.7m high control structure in the Callandoon Creek to regulate the flow and is licensed to take a maximum of 1000ML/day. The natural bed of the Callandoon Creek is used to carry all the water. Irrigators have installed their own pumps to take water and the CWSB provided meters and the CWSB reads and maintains all meters.

The CWSB will have problems in maintaining its viability over time if water is transferred out. The CWSB delivers water using 72 km of the Callandoon Creek. Due to the nature of the creek, losses can be very high, particularly if there has not been a natural flow in the creek for some months. When water allocations are removed from our system, losses will become a greater proportion of remaining water. This will be a cost the remaining irrigators will have to bear. In the long run this may lead to the scheme becoming unviable and the assets owned by the CWSB and on farm irrigation assets becoming stranded.

The CWSB holds 201ML of water to help stock & domestic supplies. In practice the 201ML offsets a small portion of CWSB’s instream losses. Stock & domestic water is supplied as a ‘by-product’ of irrigation water supply. If the CWSB becomes unviable, stock & domestic water will not be supplied. The 201ML of water would not be enough to reach most properties and maintenance of CWSB delivery structure would not be feasible.

In section 6.6.2 of ACCC position paper, the proposal that “operators must not restrict the transformation and/or trade of a portion of an irrigator’s entitlement for the purposes of covering conveyance losses.” This proposal could place the CWSB on a downward spiral. When water is removed, losses, as a proportion of thewater received, will increase and therefore increase the pressure on irrigators to remove more water.

CWSB also brings to your attention Part 6, para 169 of the Border River Resource Operations Plan. The section is telling the CWSB to socialise its losses in proportion to the allocations held by CWSB members on establishment of the CWSB. How will the CWSB do this if some allocations are no longer part of the CWSB?

Which law will take precedence in this case – Commonwealth or State Law? Will the Border Rivers Resource Operations Plan need to be modified?

We expect the ACCC to consider these questions when making its decision.

______

BW Duddy

Chairman

07 4671 1878