WA s water reforms and the 4 C s: climate change, competition, capital investment, co-ordination

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1 Water its role in supporting WA s economic growth WA s water reforms and the 4 C s: climate change, competition, capital investment, co-ordination Ed Hauck Manager Strategic Projects Department of Water 23 October 2008

2 Water Reform & the 4C s Presentation Outline Water reform Climate change / variability Competition Capital investment Co-ordination

3 Water reforms Western Australia WA National Water Initiative (NWI) Implementation Plan Government response to a Blueprint for Water Reform State Water Plan 2007 State Legislative Reform Water Services Bill Water Resources Management Bill Commonwealth COAG Climate Change and Water NWI Water Act 2007

4 Population/economic growth Projected Population Change by Region, (Haub, C World Population Data Sheet (2005))

5 Climate change Professor Ross Garnaut diabolical policy problem If we fail, on a balance of probabilities, the failure of our generation will haunt humanity until the end of time Water is not a renewable resource. People have been mining it without restraints because it has not been priced properly. Lord Stern of Brentford

6 Climate change Anthropogenic induced change The Monster within?

7 Global fossil fuel emissions CO 2 Emissions (GtC y -1 ) Actual emissions: CDIAC Actual emissions: EIA 450ppm stabilisation 650ppm stabilisation A1FI A1B A1T A2 B1 B SRES (2000) growth rates in % y -1 for : A1B: 2.42 A1FI: 2.71 A1T: 1.63 A2: 2.13 B1: 1.79 B2: 1.61 Observed % Global Carbon Budget update; Raupach et al. 2007, PNAS (Bates, B. CSIRO)

8 Temperature observations vs IPCC projections By 2070, temperatures are projected to be 2-3 deg warmer Rahmstorf et al 2007 (Bates, B. CSIRO)

9 Sea level observations vs IPCC projections 88 cm by 2100 Rahmstorf et al, 2007 (Bates, B. CSIRO)

10 Climate change Australian rainfall and population Rainfall Australian rainfall 2006 Below average Average Above average % Population (Hugo, G. 2008)

11 Climate change Evidence of rapid rate of change Another 0.6 C already locked in Melting ice sheets & caps Melting glaciers Melting permafrost Freshening of North Atlantic Ocean & Australian - Antarctic Basin Ocean acidification Atmospheric circulation changes Ecosystem changes UK soils & vegetation carbon sources Greenland moulin (Bates, B. CSIRO)

12 Climate change Southerly shift in climate zones Sub-Tropical Ridge pushed South (Sadler, B. Water Policy Services)

13 R Declining rainfall Perth Annual Rainfall Annual rainfall (m m ) 1,400 1,300 1,200 1,100 1, Perth Airport Annual Rainfall: year Central M oving Average Long term average: (819mm) M edium Term Avg: (726mm) Recent Average: (684mm) Major change in loss of flood years

14 Declining groundwater storage Gnangara Mound storage depletion (GL) Year G ro u n d w a t e r S t o ra g e D e p le t io n ( G L ) GL/yr fall in storage 45 GL/yr fall in storage (GL) 700

15 Wet mid-1900 s The sequence of wet and dry years is important for groundwater levels Cahit Yesertener, DoW

16 Competition Water for the environment Water trading Water supply and wastewater industry

17 Competition Water for the environment Environment explicitly included in management goals Provide water regimes to support environmental water requirements (EWR/EWP) Water accounting accurately monitor, assess and forecast the availability, condition and use (metering) of water resources Dave Paton - The drying Coorong - I don t think the warnings were ignored, but that our responses were far too slow and far too modest. In the sphere of water resources, the capacity of our institutions to respond quickly to changing circumstances is very limited

18 Competition Water trading A B Water trading Water entitlement share of available resource Consumptive pool - periodic announced allocation Statutory management plans Legislative reform

19 Competition Water industry Water procurement Water treatment Water network Water and wastewater retailing Wastewater network Wastewater treatment Wastewater disposal ERA Inquiry on Competition in the Water and Wastewater Services Sector Clarifying roles and responsibilities Promoting innovation Independent Procurement Entity Receive a supply security requirement from Government Identify future supply shortfalls and seek ways to meet these shortfalls via supply arrangements and demand management options developed by service providers

20 Capital investment Australian Sea Water Desalination Plants Perth 1 Gold Coast Plant Kwinana Tungun Location Capacity (ML/d) Completion Sydney Kurnell Perth 2 Binninup CITIC PS Iron Karratha Melbourne Wonthaggi Adelaide Pt Stanvac Whyalla Pt Bonython Total 1633 Source: Palmer, N, OSMOFLOW, AWA Desalting 08 Conference

21 Capital investment State investment examples SEQ Water Grid and Regional Strategy ~ $9.0 b Victoria s Our Water Future plan ~ $4.9 b Sydney Water ~ $4.6 b Adelaide desalination plant ~$ 1.2 b Binningup desalination plant ~$ 1.0 b Commonwealth investment - examples Water for the Future plan - $12.9 billion including over $1 b for environmental outcomes - Snowy and Murray Rivers Infrastructure Australia fund ($40 billion)

22 Co-operation Linking science to application (water & cliamte change) (Sadler B, Water Policy Services)

23 Co-operation Establishing a shared understanding, and Generating a shared vision of a desirable future Is critical for effective water management

24 Principles of good water governance Participatory Consensus oriented Accountable Transparent Responsive Effective and efficient Equitable and inclusive Follow the rule of law UN Economic and Social Commission for Asia and the Pacific, 2003

25 Summary Water Reform & the 4C s Climate change and unprecedented growth will continue to increase pressure on fresh water resources Actions to mitigate and adapt to climate change are critical Competition for water has intensified but market mechanisms and institutional reforms will take time to mature Successful implementation of reforms requires continued investment in science, management, planning and regulation The water industry is growing and evolving rapidly Water for future economic growth will increasingly rely on innovation, co-operation, and solid governance

26 Thank you Acknowledge: Bryson Bates, CSIRO Brian Sadler, Water Policy Services Ed Hauck

27 Australia is warming Temperature change ( o C) Australia s mean temperature since 1910 Eight climate models with additional GHGs in the atmosphere Climate models without additional GHGs in the atmosphere Karoly & Braganza (2004) (Bates, B. CSIRO)

28 Declining inflow to dams Yearly streamflows into Water Corporation dams Annual inflow to WC Dams (GL) WC Dam Inflow mean (338GL) mean (177GL) mean (108GL)