Water Issues (In: Independent Review of the Environment Protection and Biodiversity Conservation

Independent review of the Environment Protection and Biodiversity Conservation Act 1999: interim report

Chapter 9: Water Issues

9.1Issues discussed in this Chapter relate to the management and protection of Australia’s inland waters. Marine issues are dealt with in Chapter 15 of this report.

Key points

The Commonwealth’s current involvement in inland water issues under the EPBC Act is mainly in relation to Ramsar wetlands, migratory birds and some aquatic threatened species.
Several submissions suggested that water extraction, use or interception be added as a new matter of national environmental significance (NES).
Other submissions suggested that wetlands of national importance or wild rivers be listed as new matters of NES.
The Commonwealth also plays a significant role in water management outside of the EPBC Act, particularly through the Water Act 2007 and the National Water Initiative.
Improvements may be required to the development and implementation of management plans for Ramsar areas.

Water extraction as a matter of NES

Current provisions of the Act relating to water use

9.2The current provisions of the Act that relate to water are limited to the protection of Wetlands of International Importance inscribed on the list of wetlands under The Ramsar Convention on Wetlands[1] (Ramsar wetlands). Ramsar wetlands are listed as a matter of NES, and are discussed in further detail later in this chapter.

9.3Any regulation of a proposed action that will use a significant amount of water under the Act will therefore only occur if that proposed action will also impact on a matter of NES, for example, the water extracted will have a significant impact on a listed threatened species or the ecological character of a Ramsar wetland.

Key points raised in public submissions

9.4Several submissions argued that existing water management frameworks are not adequately protecting Australia’s inland water ecosystems.[2] The Environment Tasmania submission noted in particular that ‘[j]urisdictional issues have been a key impediment to the creation of effective environmental outcomes regarding water management.’[3] Some submissions cited the deteriorating state of the Coorong and Lower Lakes wetland and the Murray–Darling Basin (MDB) in general, as evidence of the need for the Australian Government to regulate water under the Act.4\[4] The Australian Network of Environment Defenders’ Offices (ANEDO) noted its support for the Commonwealth taking an enhanced role in water management, arguing that water management, especially in the Murray-Darling Basin, is a ‘vital cross-jurisdictional issue’:

The Commonwealth has signalled a clear intent to become more involved in water management, especially in the Murray Darling Basin. ANEDO supports an enhanced Commonwealth role for such a vital cross-jurisdictional issue.[5]

9.5The South Australian Government submission was the only State or Territory Government submission to deal with inland water issues in detail. This submission noted that:

Water resources that are confined within State boundaries are best managed at the State level and under existing regulatory processes. However, further consideration should be given to improve current EPBC Act arrangements to cover water resources that cross State boundaries, such as the Murray Darling Basin [and] Great Artesian Basin.[6]

9.6Submissions suggested that the Act does not sufficiently address water management issues associated with actions such as pipeline construction, large-scale irrigation projects and plantation forestry and should require Commonwealth regulation and approval.[7] It was also suggested that impacts of development should be considered ‘in terms of the plausible changes in water availability up to the year 2100.’[8]

Water use or extraction as a matter of NES

9.7A significant number of submissions suggested that water extraction or a similar wording should be added as a matter of NES. This new matter of NES was worded in various forms, including:

water extraction (discussed in more detail below);[9]
impact of development on hydrology;[10]
water interception or storage;[11]
prevention of land and water degradation;[12] and
unsustainable water use.[13]
Of the water-related matters of NES proposed, ‘water extraction’ was the most commonly discussed proposal. Some submitters, such as Woodside Energy, argued that including further matters of NES such as water extraction as a matter of NES would cause unnecessary ‘actual and potential duplication and inconsistency with existing State-based regulation’ and that existing issues associated with the implementation of the Act should be addressed before further matters of NES are introduced.[14] However, most submissions received on this topic were in favour of adding some kind of water extraction trigger to the Act.
These submissions tended to argue for the insertion of a matter of NES that would capture actions that involved the extraction of surface and/or ground water resources over a certain limit (for example 10,000 megalitres (ML))[15] or involved the construction and operation of dams with a certain height and/or capacity.[16] It was also suggested that the matter of NES be worded to capture actions that extracted a certain percentage of a water resource over a period of time.[17]
Some submissions also suggested that, in addition to actions that would use a large amount of water, the matter of NES should be worded to capture actions that are likely to have a significant impact on groundwater or aquatic ecosystems.[18] The Conservation Council of Western Australia suggested that a water extraction trigger be worded to particularly focus on actions ‘where catchments and resources straddle State boundaries’.[19]
The ANEDO’s recommended formulation for water extraction as a matter of NES received support in a number of submissions, such as The Wilderness Society.[20] This matter would capture the ‘abstraction of surface and ground water resources over 10,000 ML which is likely to have a significant impact on aquatic or groundwater-dependent ecosystems.’[21] In their justification for their suggested water extraction trigger, the ANEDO noted that:

The focus of the trigger should be on major development projects in the Murray Darling Basin. Criteria for assessing impact should be based on interference with rivers caused by major works (such as dams over a certain size); the extraction or diversion of volumes of water over a certain amount of that are likely to impact upon compliance with the Murray Darling Basin Commission cap. This is consistent with the National Water Initiative (NWI) objective to have better environmental impact assessment (EIA) for large water infrastructure.

The trigger should also focus on the use of water which significantly impacts the Great Artesian Basin such as operations by mining companies so as to ensure that the resources in the Basin remain for future generations.[22]

9.12The ANEDO’s submission also recommended that provisions be created to enable the Minister to release environmental flows to areas in need.[23]

9.13During public consultations, one mining industry stakeholder suggested that, if groundwater use or groundwater extraction was included as a new matter of NES, care should be taken that this matter of NES does not capture mining operations that involve groundwater formation.

Interaction between the EPBC Act and the Water Act 2007 (cth)

9.14Several submissions noted the existence of the Water Act 2007, including the ANEDO submission, which noted that:

it is essential that there are clear links between the Water Act and the EPBC Act to ensure environmental considerations are fully considered and do not disappear down the gap between the two Acts.[24]

9.15The Australian Human Rights Commission (AHRC) also suggested that the EPBC Act be amended to include the relationship between the EPBC Act and the Water Act 2007.[25]

Senate inquiry into the operation of the EPBC Act

9.16In the Senate Committee’s report on their inquiry into the operation of the EPBC Act, Additional Comments from the Australian Greens included a concern that ‘water extraction and use’ is not a matter of NES and recommended that ‘activities involving ground water and surface water interception and/or extraction’ be listed as a matter of NES.[26]

Discussion of key points

Relationship between the EPBC Act and the Water Act 2007 (Cth)

9.17The creation of the Water Act 2007 significantly changed the role of the Commonwealth in water management. This Act gives the Commonwealth (through the Murray-Darling Basin Authority) a central role in the management of water resources in the MDB. However, the Water Act 2007 mainly applies to the catchments of the MDB. This means that the Commonwealth only plays a limited role in water management in the 11 other water drainage divisions in Australia.[27]

9.18It was noted in several submissions that many parts of northern Australia remain undeveloped, but that, with the continuing drought and predicted impacts of climate change on southern Australia, there would be increasing pressure to develop northern Australian water resources.[28] The Victorian Office of the Environmental Sustainability Commissioner argued that there should be a:

comprehensive, national system for identifying and protecting these environmental assets [in northern Australia], which is in place before development pressure builds and ensuring a cooperative approach through complementary, rather than conflicting, strategic policy design is crucial to protecting their biodiversity.[29]

9.19In this regard it is relevant to note that the Australian Government has created the Northern Australia Land and Water Taskforce (NALWT). The terms of reference for the NALWT include gaining a

better understanding of opportunities for new sustainable economic development in the north that are based on water resource availability, and the potential impact of such development on the underlying water balance and water quality, and on the natural environment, existing water users and the broader community.[30]

9.20The NALWT is required to identify the sustainable capacity of the river systems or drainage basins, opportunities for sustainable economic development, the impact of development on the environment and other water users, instruments to manage this development and recommend governance arrangement for these water resources.[31] The NALWT is due to report in December 2009. In addition to this work, the Northern Australia Water Futures Assessment (the Assessment) is a multidisciplinary program with the overarching objective of providing an enduring knowledge base to inform protection and development of northern Australia’s water resources, so that any development proceeds in an ecologically, culturally and economically sustainable manner. The Ecological Program within the Assessment aims to understand the key water-dependent ecological assets across northern Australia and to gain an understanding of the risks to the values of those assets arising from changes in the hydrological regime. The Ecological Program will pay particular attention to key catchments identified by jurisdictions as planned development areas (including for increased development of floodplain structures, farm dams, plantations, groundwater extraction, irrigation and for ‘water storage options’).

9.21It is hoped that the NALWT’s report and the Assessment will help inform future decisions about northern water resources, so that the problems being faced today associated with what was termed by the Minerals Council of Australia as the ‘misalignment of land use planning and resource availability’[32] are not repeated in the north.

9.22Finally, the Basin Plan for the MDB is due to come into operation in 2011; however State/Territory water management plans will only need to be fully compliant with the Basin Plan once current plans expire (between 2012 and 2019). A water extraction trigger under the EPBC Act may be able to ‘fill the regulatory gap’ between approval of the Basin Plan and establishment of new water resource plans that must be compliant with the Basin Plan; however the introduction of a new matter of NES would be unlikely to affect current water entitlements, as these entitlements are likely to fall under the s.43A prior authorisation exemption in the EPBC Act[33].

Water extraction trigger

9.23The sustainable use of water resources has gained an increasing amount of attention over the last 15 years, particularly with the ongoing drought in the southern MDB. The cross-jurisdictional nature of many of the significant water resources such as the MDB, Great Artesian Basin and the Lake Artesian Basin suggests that a coordinated national approach to managing these basins is desirable. The approach taken in the arrangements set out in the Water Act 2007, where the Commonwealth creates a plan with which State/ Territory authorities must comply in creating local water allocation plans, may be a useful approach to follow for other major drainage basins in Australia.

9.24However, there may still be some proposed actions whose impacts on the environment are considerable to the point that they warrant Commonwealth regulation or management. If this is the case, one option would be through declaring ‘water extraction’ as a matter of NES under the EPBC Act. From a practical standpoint, proposed actions that will have or are likely to have a significant impact could include the construction of on-farm water storages or other dams, extraction of water for mining activities, the issuing of new water entitlements or water use for new plantation forests.

9.25A key issue in introducing water extraction as a matter of NES would be defining what constitutes nationally environmentally significant levels of extraction. Creating a trigger that relies on an action taking a specific amount of water from a water resource may not be the most effective way of determining the significance of an action. There is a significant variation in the size of water resource areas in Australia. What constitutes a ‘significant impact’ on a water resource will therefore vary according to the size and condition of the particular water resource in the particular circumstances of the proposed action and in light of existing demands and other possible pressures on the resources.

9.26It is also important to determine what it is the Commonwealth wants to protect if it is to increase its role in water management. Australia’s international obligations are not directly concerned with amounts of water extracted from a particular water resource – the Commonwealth is instead concerned with potential impacts on environmental assets and aquatic ecosystems that are deemed to be of national significance. It may therefore be more appropriate for the Commonwealth to act to protect nationally significant environmental assets or the ecological character of nationally significant aquatic ecosystems or water resource.

9.27Providing protection of the ecological character of a water resource under the Act could be undertaken in a manner similar to that which is currently taken for Ramsar wetlands (a current matter of NES discussed below), which regulates actions that are likely to have a significant impact on the ecological character of a Ramsar wetland.

9.28Arguably the current Ramsar wetland matter of NES may be broad enough to trigger the operation of the EPBC Act for a substantial number of actions that are likely to have a significant impact on aquatic ecosystems (particularly due to a consideration of an action’s downstream impacts). However, this approach to regulating likely impacts on significant environmental assets or the ecological character of significant aquatic ecosystems through the Ramsar wetlands ‘trigger’ is probably not the best approach and is likely to be confusing in practice. It may therefore be more appropriate to create a new matter of NES that relates to water extraction and use.

9.29This new matter of NES could act to require the Minister to approve actions likely to have a significant impact on the ‘environmental assets of a water resource’ or on the ecological character of a nationally significant water resource. The term ‘environmental assets’ is used in the Water Act 2007 and includes ‘water-dependent ecosystems, ecosystem services and sites with ecological significance’.[34] The concept of ‘ecological character’ is currently used in relation to the protection of Ramsar wetlands under the Act. This concept could be used to identify the attributes to be protected under the EPBC Act for other nationally significant water resources.

9.30While the inclusion of a new trigger in the EPBC Act for the ecological character of a nationally significant water resource would require significant investment in determining what sites have ecological significance, what constitutes ecosystem services and what services are critical to maintaining or enhancing the ecological character of each particular water resource, this knowledge is important and necessary to enable informed decisions to be made about the sustainable use of Australia’s water resources into the future. As it is part of the objects of the Act to promote the principles of ecologically sustainable development, including the principles of intergenerational equity, it may be useful to examine the impacts of actions on the environmental assets of a water resource.[35]

Considerations of water use in the EIA process

9.31When determining whether a proposed action is likely to have a significant impact on a matter of NES, and therefore requires consideration under the EPBC Act, the potential impacts likely to be generated by the action, including indirect consequences of the action, must be considered. The downstream impacts of a proposed action are a type of indirect impact under the EPBC Act.[36] As has been noted in several submissions, determining the extent to which downstream impacts must be considered is a challenge for proponents.[37] In a water context, it is difficult to determine what is considered downstream for the purposes of the EPBC Act, particularly when the action impacts part of a large water resource. For example, does a proposed extraction of water in the Paroo River (in the northern MDB) need to consider the potential impacts of this action on the Coorong and Lower Lakes (a Ramsar site) at the southern end of the MDB? It may be helpful for further guidance to be provided on how downstream impacts (as well as any upstream or facilitated impacts)[38] should be considered by proponents of proposed actions.

9.32Further, in considering the long-term impacts of a proposed action, it is important to consider the likely changes to the availability of resources such as water. For example, water availability in the MDB is predicted to decline in future decades due to the predicted impacts of climate change.[39] Decision-makers should consider these impacts in the decision-making process.

Wetlands or wild rivers as a matter of NES

Current provisions of the Act relating to water use

9.33These provisions are outlined earlier in this chapter.