Water access entitlements, allocations and trading

Water access entitlements, allocations and trading have been key elements of recent water reforms in Australia. Achieving nationally-compatible water access entitlements, returning over-allocated systems to environmentally-sustainable levels of extraction, and removing barriers to trade in water to facilitate the broadening and deepening of the water market are all objectives of the 2004 Intergovernmental Agreement on a National Water Initiative (NWI).

In many areas of Australia, self-extracted water use is managed through the granting of water access entitlements and water allocations. A water access entitlement, such as a water licence, refers to an ongoing entitlement to exclusively access a share of water. A water allocation refers to the specific volume of water that is allocated to water access entitlements in a given season. Water trading is the process of buying, selling, leasing or otherwise exchanging water access entitlements (permanent trade) or water allocations (temporary trade).

Irrigation water being pumped from the Murray River, near Mildura
Irrigation water being pumped from the Murray River, near Mildura
Sourced from National Water Commission

The ABS publication Water Access Entitlements, Allocations and Trading (cat. No. 4610.0.55.003) presents data on the number of water access entitlements, the volume of water allocated to water access entitlements, and water trading in Australia in 2004-05. All data was provided by the relevant Government agencies in each State and Territory, or obtained from publicly available sources. This is the first publication to collate and present this information for the whole of Australia.

Key findings

  • There were 223,556 water access entitlements in Australia with a total entitlement volume of 29,831 GL in 2004–05.
  • Surface water access entitlements accounted for 76,625 (or 34%) of all water access entitlements and 22,814 GL (or 76%) of the total entitlement volume in Australia.
  • Groundwater access entitlements accounted for 146,185 (or 65%) of all water access entitlements and 6,998 GL (or 23%) of the total water allocated in Australia.
  • There were 1,802 permanent water trades in Australia with 248 GL of water traded permanently
  • There were 13,456 temporary water trades in Australia with 1,053 GL of water traded temporarily

Water access, entitlements and allocations in Australia, by water source for 2004-05

ACT NSW 2 NT QLD 3 SA TAS VIC 4 WA Australia
Surface Water

Number of entitlements

27 25 64 27 3 3  17 878 77

Entitlement volume (GL)

64 10,644 60 3,488 789 1,038 5,828 903 22,814

Allocated volume (GL)

64 7,136 60 na 789 1,038 4,370 903

na

Groundwater

Number of entitlements

114 93 102 21 6 0 8 17 146

Entitlement volume (GL)

660 2,658 80 909 854 0 852 1,644 6,998

Allocated volume (GL)

660 2,663 80 na  854 0 364 1,644

na

Surface and Groundwater 1

Number of entitlements

12 0 0 0 734 0 0 0 746

Entitlement volume (GL)

1 0 0 0 17 0 0 0 19

Allocated volume (GL)

1 0 0 0 17 0 0 0 19

Source: Water Account, Australia, 2004–05
1. Water access entitlements that allow the holder to access both surface and groundwater sources
2. Maximum available water has been used for allocated volume in New South Wales
3. Excludes 1,931 water licences without a volumetric entitlement volume in Queensland
4. Volume taken has been used as a proxy for allocated volume in Victoria

For the ABS project, water trading was defined as the "transaction (between a buyer and seller) involving water access entitlements (permanent trading) or water allocations assigned to water access entitlements (temporary trading)". However, there may be differences in terminology, legislative arrangements and administrative systems to do with water trading and as such current data needs be interpreted with caution.

For example, in irrigation schemes (where the majority of trades take place), some irrigators may not have a specific water access entitlement. Instead, the irrigation water provider has a bulk entitlement and irrigators receive and can trade shares of that bulk entitlement. In the case where irrigators have a share of a bulk entitlement, any trades of these shares were not recorded on the state and territory water register because the water access entitlement (the bulk entitlement) has not changed. This is why trades in some regional water supply systems were not recorded by the jurisdictional agency responsible. Most irrigation water providers keep records of water trades and make this information publicly available.

The ABS suggests that future compilation of water trading data will require further clarification and possibly tightening of the definition. If water trading is considered to be only those transaction involving a water access entitlements, then data should only be sourced from state departments. If water trading is considered to include any transactions of water, including trading that occurs within a bulk entitlement, then trading data needs to be sourced from irrigation water providers as well as from state departments.

In terms of presenting the complete picture of water trading in Australia it would be useful to present both, and identify separately trades of entitlements and trades within irrigation schemes, where possible.

The ABS publication 4610.0.55.003 - Water Access Entitlements, Allocations and Trading is available on the Publications page or via the Australian Bureau of Statistics website.

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This website was last updated in 2007. It is no longer being maintained but remains here as an archive for information.29/06/2007