Through the glass darkly- uncertainty, climate chaos & Water policy reform challenges

1. Through the glass darkly- uncertainty, climate chaos & Water policy reform challenges Presenter: Jason Alexandra MDBA November 2009

2. Overview • Background • Context and Challenges • A Brief History of water resources policy • Water reform in context • Climate change • Conclusions

3. Understanding the variability and ecological limits of Australia… "Charles Darwin …. Visited Sydney in 1836. After an uncomfortable tramp over the Blue Mountains in a heat wave, he concluded that Australia could never become another America - its soil was too poor, its rains too unpredictable. Instead it must depend on becoming "the centre of commerce for the southern hemisphere and perhaps on her future manufactories.“ As quoted in McCalman, The Age, 10 August 2002.

4. Despite these warnings “Successive Governments sponsored closer settlement and intensive irrigation development, with dreams of taming the rivers, greening the desert, and making land productive, running deep in the national psyche (Lines 1994) notwithstanding, punishing droughts and misconceptions about the severity of the natural constraints to settlement and production (Taylor 1940).  Generations of school children have been taught of love for “a land of drought and flooding rain” (McKellar 1987). Reflecting Australia’s climate pulsing through its wetter and drier phases. Our natural ecosystems have evolved superb adaptations to the inherent climatic variation (Cullen 1998).” headline copy

5. Successive Australian governments have attempted to “tame the rivers and made the deserts productive”. The majority of the MDB is flat, semi arid and developed for agriculture and pastoralism. The “wet” parts, like the main rivers, floodplains and wetlands are critical habitats – with their pulse of drought and flood. Major legacy issues headline copy

7. Modified catchments, nutrient and suspended sediment loads and habitat Very high nutrient and suspended sediment loads Largely unmodified in all aspects Catchment Condition

8. Australian water era • 1890’s – 1980’s Development era – “drought, royal commission, new dam” • 1992 Industry Commission – TWE • 1994 COAG reforms – environmental flows, unbundling water and land “titles”; corporatisation and cost recovery • 1995 – MDB “Cap” on development • National Water Initiative 2004 – reaffirms reform agenda and markets’ role in reallocating water

9. Irrigation • The biggest user of diverted fresh water • Produces more than half the profit in Australian Agriculture & Horticulture, from 0.5% of land (NLWRA 2002)

10. 18,000,000 12,000,000 Capacity (ML) 6,000,000 1890 1912 1934 1956 1978 2000 Government funded development of dams Major periods of water diversions (note Murray average inflows approx 9,000,000 ml) Murray Darling

11. Global demand for food Surge in cereal and oil prices Commodity prices (US$/ton) • Source: Data from FAO 2007 and IMF 2007.

12. An engineered system The MDBC has an Engineering Heritage

13. The Murray – an “exotic river” • Less than 10% of it’s catchment yields > 90% flow • Large in scale but less flow in an average year than the Amazon in a day • Highly variable – heavily exploited water resources • Highly developed but thus high vulnerability • Future health influenced by climate change, landuse, bush fires, forestry and water resources policy reform

14. Water - a complex business

15. Maximum reduction in yield: Vic 2003 fires: Reductions of up to 1237 GL/y in 20 years

16. The wetlands – degrading (Kingsford) Narran Lakes Gwydir wetlands Macquarie Marshes Lowbidgee floodplain Coorong Chowilla floodplain Kulkyne Lakes Barmah-Millewa Forest • ~28,000 • 6.3 million ha • 98% floodplains • ~3% protected

17. Macquarie Marshes -Changes 1,500,000 1,200 Flow (ML) to Marshes Rainfall index 20,000 20 1945 2005 500 1983 2007 20 80,000 1983 1991 1999 2007 1995 2008 1986 No. of waterbirds Major dams Average 22,465 4,990 567 Number of species No. of nests No breeding

18. Is this Drought Different? Key River Murray Catchment Area

19. An Irrigation Drought – several dry years June 2008 2,220 GL

20. Trade in water supports Greenfield developments and adjustment New horticulture up to 14 kilometres from the river Estimates of up 32000 hectares since trade started Nearly all outside “historic irrigation districts”

21. Water for the future: All figures in A$ million Costing over ten years TOTAL: approx A$12.9 billion (about US$9 billion) http://www.aha.net.au/

22. Key Elements of the Basin Plan

23. Water Resource Planning BEFORE THE BASIN PLAN IS MADE (some shared strategies) Basin- wide issues SA VIC QLD NSW ACT Water resource Water Resource Plans Water Sharing Plans Bulk Entitlements Water Allocation Plans Water Sharing Plan plan area issues Local generally 2014 2019 up to 2014 2014 TBA issues 10 years 15 years 5 years 10 years TBA Industry and Individual water rights holders

24. Post Basin Plan

25. Information demands New quality assured information required • To support the plan • Risk assignment • Determine how much water is available • How much has been reduced by climate change

26. Water Act 2007 Enable Commonwealth in conjunction with States to manage Basin’s water resources in the national interest Give effect to international agreements, optimise economic, social and environmental outcomes Ensure environmental sustainability and in this context, maximise net economic returns to the Australian community improve water security for all uses of Basin’s water resources (after Water Act 2007)

27. Climate is Hotter and Drier Satellite estimate of soil moisture Global average temperature Australian average temperature

28. Global emissions tracking on the higher IPCC scenarios Warmer drier conditions in the future under all global emission scenario’s Majority of models project reduced runoff for SE Australia, including Murray system headwaters Projected changes in run-off at 2030 under scenario A1B, showing the number of climate models (out of 15) yielding an increase or decease in run-off; from F. Chiew. Future Projections

29. Actual Decreases in Runoff

30. Drier Autumns Monthly mean south eastern Australia rainfall, 1961-1990, 1996-2006 and anomaly

31. 70 units evaporation, transpiration & soil moisture threshold 70 units evaporation, transpiration & soil moisture threshold 100 rainfall units 90 rainfall units 10% less rainfall 30% less streamflow Rainfall & Streamflow(hypothetical catchment) 30 units streamflow 20 units streamflow

32. Lower rainfall = much lower Streamflow CSIRO and Australian Bureau of Meteorology, 2007)

33. Declining inflows for the Murray Source: http://www.dse.vic.gov.au/DSE/wcmn202.nsf/fid/13B5D5D8F4A2D943CA25742C007CF6EA

34. Increased demand for groundwater as surface water availability reduces? Higher evaporation. More farm dams as surface water availability reduces? Increased forest evapo-transpiration due to higher temps? Higher frequency and intensity of bushfires due to higher temps and worse droughts? Greater irrigation efficiency as surface water availability reduces? Other Impacts of Climate Change Climate change ? ? ? ? ?

35. Water market dynamics • Water market dynamics in a climate of change and uncertainty: • Value up due to scarcity – needed to protect high capital permanent plantings • Impacts of government buybacks – $3 billion • Higher prices for outputs due to global food scarcity • Greenfields developments competing for available water

36. Australia is now responding to a multifaceted “water crisis” - symptoms include record low inflows in the Murray-Darling Basin, water restrictions in cities severe stress on many rural communities and aquatic ecosystems – eg Lower lakes. A “water crisis” without precedent, despite “a long and proud history of water planning, the impending crisis was largely unforeseen and its origins are still poorly understood” (Schofield et al 2008).

37. Causes of the “crisis” - climate and land use change, Australia’s inherent climate variability, with long droughts high rates of vulnerability – development based on high rates of water use. Concerns about the reliability of Southern Australia’s water resources Science more emphatic about the impacts of climate change, particularly the drying and intensification of droughts in the mid-latitudes. Fears that the speed and scale at which climate change impacts are intensifying.

38. Conclusions • Pressure for better information on water, but; • Impacts of climate change? Or chaos • Expression of natural variability? • Need to operate under uncertainty and extremes • Intense political and community interest • Drought responses – rural and urban • Trade and irrigation structural adjustment • Can we rebalance extractions and environmental water ?

39. Conclusions Extremely low water availability in the southern MDB Impacts of the drought/climate change are unprecedented Long term reductions in rainfall and runoff likely Policy and climate induced water scarcity Intense competition for water Adaptation and innovation is required and inevitable Water policy, rural industries and irrigated agriculture will evolve Range of policies required to support adjustment and adaptation

40. For more information: http://www.mdbc.gov.au