Feedback on the Draft Point Source Water Quality Offsets Policy 2017

Transcription

1 Industry Feedback qldwater consolidated feedback Feedback on the Draft Point Source Water Quality Offsets Policy 2017 September 2017 Contents 1. Summary Background Collated Industry Response General Issues Broaden Scope of the Policy Risk Sharing Conclusion Summary The Queensland Water Directorate (qldwater) collated information and input from across the urban water and sewerage sector in response to the Department of Environment and Heritage Protection s request for submissions on the Draft Point Source Water Quality Offsets Policy. The sector has indicated that this policy is important to the future environmental sustainability of Queensland communities and flexible options are urgently needed to improve environmental protection with more efficient use of limited public funding. The offsets policy could provide an essential foundation for such options if it can be amended to better meet its stated aim of flexibility. The sector acknowledges the first draft of the Policy reflects the Department s willingness to listen and respond to industry feedback and appreciates significant consultation since the

2 release of the document. However, there are still significant barriers and perverse incentives that have been only partially resolved and the sector requests further development of the Policy and offers contribute to and assist in this process. It is recommended that: a. A working group is established, with industry representation, to rewrite elements of the Policy and prepare a supporting guideline. b. The revised draft Policy and guideline is made available for wider consultation across the sector and other stakeholders selected by the Department. c. The working group consider submissions from the wider consultation and finalise the Policy and supporting guideline. d. State Government/DEHP collaborate with the water and sewerage sector and cofund a range of water quality offset projects to showcase working examples of how the Policy can be implemented. 2. Background The Queensland Water Directorate (qldwater) is the central advisory and advocacy body within Queensland s urban water industry representing the majority of the State s Water Service Providers, from small local governments up to major utilities including Queensland Urban Utilities and Unitywater. qldwater works with its members to provide safe, secure and sustainable urban water services to Queensland communities. This collated response was compiled for the Department of Environment and Heritage Protection in response to their request for submissions on the Draft Point Source Water Quality Offsets Policy. A Water Quality Offsets policy is strongly supported by the urban water sector. The current policy has many constraints, meaning the only examples of its use to date have been through large urban service providers. Some of these issues have been addressed in the draft policy and the industry acknowledges the Department s willingness to listen and respond to industry feedback. There has been significant consultation since the release of the document and qldwater would like to thank the Department for working iteratively with the sector on this policy. The indication that DEHP encourages evidence-based pilot project submissions to build further knowledge is also strongly supported. However, there are still significant barriers and perverse incentives which have been only partially solved. This response provides feedback on these issues with respect to the urban water and sewerage sector and proposes solutions to help achieve the policy objectives. 3. Collated Industry Response This response is collated from written submissions, phone interviews and discussion by the qldwater Sewage and Water Environmental Advice Panel (SWEAP) and the Technical Reference Group. Several written responses were also incorporated including feedback from the WIM Water Alliance, Outback Regional Water Alliance and Wide Bay Burnett Regional Organisation of Councils Water Alliance. qldwater also encouraged individual members and QWRAP regions to provide responses to the Department and organised briefings jointly with EHP officers. Page 2 qldwater ph:

3 4. General Issues The offset mechanism aims to provide an alternative investment option for meeting water emission discharge requirements after considering the EPP management hierarchy. It appears to be proposed as a last resort for discharges that cannot be addressed through other stages in the EPP management hierarchy and will otherwise require expensive treatment solutions. The view of qldwater is that this is a missed opportunity for improving environmental outcomes (see Section 4 below) but even at face value the current policy has problems that will work against the desired objectives. Some of these are issues of clarity or statements that could be misinterpreted and are listed below. Requirements (p. 4, first dot point) States that: increased point source discharge must not occur within areas that have been identified as ecosystems of High Ecological Value (HEV) or Slightly Disturbed (SD) under the Environmental Protection (Water) Policy 2009 (EPP). This would appear to exclude the use of the Policy in much of SEQ and some other coastal sites (if the Draft Water EPP is adopted). The intention of this requirement should be clarified. Requirements (p. 4, fourth dot point) states: of course it is expected that water quality offset providers are already meeting current recommended practice before undertaking the water quality offset. This requirement (?) is presumably intended to ensure any offset adds value to average (e.g. agricultural) environmental performers and does not reward those that do not achieve recommended practice. However, it also prevents the poorest performers being assisted to improve their practice and imposes significant practical barriers to the offset funder. In particular it requires identifying recommended and best practice/performance and being able to find an appropriately mediocre performer upstream of the point source. This requirement should be removed in the first instance and revisited or included as where possible, preference should be given to providers currently using recommended practice when the Policy is well-established. Location (p.4) appears to include a requirement for feasibility evaluation of locations for all proposed offsets. Presumably it means that nearer, upstream or more local locations must be assessed if an offset is proposed downstream or in another catchment. If this is the intention it should be clearly stated. Attenuation Factor (p. 5) the term is difficult to reconcile with the ability to explore offsets downstream or in other catchments. In these cases there is no attenuation of any offset with respect to the discharge point. Unless attenuation is intended to mean a nutrient reduction prior to the end of catchment another term would provide greater clarity and better resolve the intended difference between the attenuation factor and offsets ratio. The intention to allow higher attenuation ratios in certain cases (p.5) also needs to be explained. There is no scientific mechanism for determining what such a factor should be so it could be seen as an arbitrary barrier to avoid offsets in other catchments. If this is the intention then it should be clarified, but if the aim is to allow lee-way to manage the Page 3 qldwater ph:

4 uncertain nature of more distant offsets, then the value of each offset would be better assessed based on the risks and benefits it provides. As this would be difficult, costly or impossible to assess an agreed multiplier represents a useful heuristic but this advantage is limited by the arbitrary specification of higher but unknown multipliers. Criteria should be specified outlining how the selection of attenuation factors be based and examples (perhaps from other jurisdictions) would be valuable needed. Several service providers expressed interest in working with the Department to collectively investigate these issues as well as assimilative capacity and optimal monitoring and review processes working with e.g. NRM bodies. In fact, the benefits at more distant sites may well justify a smaller multiplier (e.g. for improvements of HEV waters or where nutrient runoff has been assessed as an urgent issue). There appears to be no mechanism for assessing this form of trade-off and yet a full feasibility assessment is required of every potential site between the point of discharge and the offset location (see p. 4 Location). There is also some confusion between the attenuation ratio and the offsets ratio. These ratios should be simplified with a clearer policy statement and examples about the need for and the ability to increase or reduce a ratio if sufficient evidence is provided, so long as a certain minimum is achieved. Toxicity Risk and no negative impact (p. 5, para. 2). Guidelines on determining toxicity risk are needed if the first statement is to be addressed meaningfully. Similarly, the definitions of toxicity risk and no negative impact must be clarified as any point source discharge will could be included within these terms if the ultimate aim is (the currently entirely unachievable goal) of zero-discharge. Local toxicity (p. 6, first para.) expresses a number of important points but could be clearer. The main aim appears to be to avoid any increase in risk from toxins at the point of discharge which is supported. There are two issues to be considered. The first is the concentration of toxins linked to the loads of nitrogen or phosphorus being offset (e.g. ammonia species). These could be controlled through treatment processes that control e.g. the fraction of ammonia contributing to total N and this would be best managed through concentration limits in the EA for discharge site (and not this Policy document). Second are concentrations or (more commonly) loads of contaminants not related to nutrients (such as BOD and heavy metals) which would again best be managed through concentration and load limits set within the EA for the point source rather than the offsets policy. The policy should clarify when release limits for toxicants in an EA for a point source discharge will be impacted and what monitoring may be necessary as there is potential for very complex and costly analyses. The final, related issue is the possibility for increased release of toxicants at an offset site (presumably as a by-product of the offset action). This issue is best dealt with through this Policy and could be achieved if the Policy stated something like: Offsets will not be considered if they increase discharge of toxicants at the offset site. Offsets that reduce release of toxicants as well as the nutrients being targeted will be looked on favourably. Page 4 qldwater ph:

5 Offsets ratio (bubble licence) (p.6) requires clarification. The second paragraph is clear and deals with upstream bubble licences in the same water type. However, this is an unlikely scenario in Queensland except in very large (fresh water) catchments where any sort of equivalency of the receiving environment is probably meaningless. The third paragraph deals with all other bubble licences and is likely to represent the majority of cases relevant to STPs. It requires an increased attenuation factor based on the distance of the offset from the point source and equivalency demonstration by the proponent. As the bubble licence deals only with like-for-like comparisons of nitrogen and phosphorus between two point sources, concentration and load comparisons will be very precise and equivalency clear. Presumably the Policy is referring to equivalency of the water quality outcome in the receiving environment which is far more difficult to determine. The Policy should provide further information or examples on how water quality outcomes at an offset site can be meaningfully compared to those at the discharge site [noting industry support to review this issue in partnership with the Department]. The Policy should also clarify how a bubble licence should be approached if an entity has spare capacity within its current EA (due to optimisation processes or design for larger population sizes that have not yet eventuated). Offsets ratio (diffuse source) (p.6, para. 3) states: an attenuation factor may increase the ratio to ensure an improved water quality outcome in the receiving environment. The application of the attenuation factor will depend on equivalency demonstration by the proponent (Table 1). For similar reasons as outlined above, this needs clarification. For example, an improved water quality outcome in the receiving environment of the offset is guaranteed (by definition). If receiving environment is defined more broadly (it is not included in the glossary) then it is at best tautological and at worst misleading. The ability to vary the offsets factor based on scientific evidence should be included in the Policy and it would be better to simply say a ratio will be applied to all offsets for policy purposes as a buffer to ensure continuous improvement. More information needs to be provided on how equivalency demonstration might be achieved. Wet vs Dry Weather (p. 7) it is difficult to determine the intention of this section (though the use of examples is helpful) and it is unclear why wet and dry weather loads must be separated for non-toxic species (where concentrations may be more relevant). This section represents a significant restriction and will impact service providers seeking to use the existing policy. The needs of catchments affected should be taken into account, particularly the greatest risks to environmental values rather than introducing a prescriptive like-forlike principle. Furthermore, definitions of wet and dry weather are difficult (and not included in the Draft). The Policy is not clear about the purposes for distinguishing wet and dry weather impacts and appears to confuse discharge concentrations and discharge loads. The inclusion of advice on the need for recycling and beneficial reuse adds confusion. This is part of the management hierarchy in any event and seems out of place in the Policy. In contrast, the Policy s silence on the recognition of recycling and reuse as a form of offset is a limitation. Although irrigation of wastewater for agriculture is already included in the management hierarchy cases where this form of recycling may reduce use of other nitrogen and phosphorus fertilisers should be encouraged. Although this form of recycling could be Page 5 qldwater ph:

6 undertaken without the offsets Policy, it should be recognised as a form of offset to promote and encourage its use at STPs. Timing (p. 8) requires that offsets must be provided in advance or concurrently with impacts that are occurring so that the nutrient reduction action provides the benefit at the time of additional nutrient release. This requirement appears to consider only concentration impacts of nutrients (which are less relevant if offsets are created in a different catchments). It would be sensible to consider total nutrient loads and the potential to immediately implement actions that could contribute to reducing end-of-catchment loads. The Policy should encourage the development of nutrient reduction actions prior to a major change in point source infrastructure occurring and allow offsets against accumulated total loads over time. This would allow the development of numerous small investments in nutrient load reduction which would (i) defray costs and risks, (ii) increase immediate ecological benefits and (iii) have the best chance of contributing to cumulative downstream and end-ofcatchment benefits. This would also provide greater surety to both the regulator and the EA holder that appropriate nutrient reductions were being sustainably achieved and that relationships with landholders, contractors and catchment groups were tested. The power of demonstration sites and proof-of-concept studies should not be underestimated particularly in promoting the innovative or culture-changing processes and activities necessary for this Policy to achieve its objectives. The Policy should be amended to encourage gradual, modest investments in nutrient reduction activities that improve environmental outcomes immediately and create a buffer for future potential point source changes. Duration (p. 8) the policy allows that the duration of the nutrient reduction action will be negotiated on a case-by-case basis to align with the performance specifications and lifespan of the point source infrastructure (maximum of 20 years). Capital planning for sewerage assets has a time horizon of years and represents one of the most significant expenses of public funding for all communities. The 20 year time period reduces the ability for local government planners and funders to justify use of offsets within a standard planning horizon. Moreover, there is no reason that a successful offset should not be continued for as long as it reduces nutrient contributions and abruptly ceasing maintenance and monitoring of offset locations could be detrimental. The Policy should clarify the expectations at the end of an offset duration and whether a continuation can be negotiated so that beneficial offsets might be perpetual. 5. Broaden Scope of the Policy The policy has no regard for nutrient reductions at the end of catchments or broader receiving environment (e.g. a bay or the GBR lagoon) meaning that there can be no consideration of downstream improvements. In cases like the GBR or Moreton Bay, rather than being a last resort in the management hierarchy, offsets should be actively pursued and encouraged. Offsets could contribute to reduced loads of contaminants reaching HEV environments in the immediate term and proved greater environmental benefits than can Page 6 qldwater ph:

7 be achieved at the same cost at the point of an STP discharge. As STPs are public-owned infrastructure the aim should be to achieve the greatest environmental benefit considering communities social, financial and ecological values at both discharge and offset sites. This should include the potential for downstream improvements and end of catchment loads. The Policy should be expanded to encourage reduction of nutrient loads in priority areas while protecting environmental values at the STP discharge point. 6. Risk Sharing The Policy places all risk and costs on the EA holder and threatens that if the water quality offset fails to achieve the agreed outcome, and the proponent is unable to demonstrate that the water quality offset has been appropriately implemented and maintained, then this will be a breach of the environmental authority and the department will consider its enforcement options. The only incentive to allow councils to justify to their communities taking on these risks and costs are the potential savings from deferred infrastructure investment. However, even these savings are limited to the period of the offset agreement with a maximum of 20 years. A partnership is needed whereby the State recognises the risks taken by early adopters (or trial sites) and responds accordingly particularly for publically owned and managed STPs. The Policy should create mechanisms to shift this balance and increase certainty for potential investors and innovators. Appropriate responses could include: agreements of amnesty from prosecution if the offset has been appropriately implemented and maintained and further description of what this means, technical assistance with identifying appropriate sites and site assessments, partnership agreements with third parties to provide confidence in the offset approach, joint marketing and publicity to demonstrate the benefits of offsets to the broader environment and affected communities, jointly exploring insurance mechanisms that could offset some of the risk involved in water quality offsets, and jointly designing and undertaking monitoring programs for early offsets recognising the complexity and costs involved. Only a partnership approach between the State and local governments will provide sufficient resources and allow appropriate risk-sharing to overcome the uncertainties and risks the Policy entails. 7. Conclusion The importance of this policy to the future environmental sustainability of Queensland communities should not be underestimated. Some communities are growing, many have static or falling populations but all have a mechanism to manage sewage. Whether it is Moreton Bay, Lake Eyre, Fraser Coast, the GBR, or the Murray Darling Basin, Queensland STPs discharge to catchments with sensitive receiving environments and the pressure to protect their values is increasing as the economic environment is becoming more Page 7 qldwater ph:

8 constrained. Flexible options are urgently needed to improve environmental protection with more efficient use of limited public funding. The Draft Policy could provide an essential foundation for such options if it can be amended to better meet its stated aim of flexibility. In most cases STP discharges provide a relatively minor component of the total volume of nutrients and sediments reaching these environments and they are relatively expensive to upgrade, particularly at small scales. To direct limited public funding to the highest possible use requires often difficult trade-offs and risk-based decision making. An outcomes-based policy that is able to balance potential risks with broad environmental benefits is an essential requirement for informing such trade-offs and balancing public investment to protect not just local waterways but also the broader catchments and their receiving environments. qldwater believes that the current draft is a good initial step but could do with revision and offers to assist in this process. It is suggested that e. A working group is established, with industry representation, to rewrite the Policy and prepare a supporting guideline. f. The revised draft Policy and guideline is made available for wider consultation. g. The working group consider submissions from the wider consultation and finalise the Policy and supporting guideline. h. State Government/DEHP collaborate with industry and co-fund a range of water quality offset projects to show case working examples of how the Policy can be implemented. Page 8 qldwater ph: