Update on Goulburn IVT Account

The Goulburn system’s inter-valley trade (IVT) account currently account owes about 274 GL to the Murray system.

Goulburn, Campaspe and Loddon systems cannot trade to the Victorian Murray system, New South Wales and South Australia if the volume traded out but not yet delivered to the Murray exceeds 200GL. The Murray Darling Basin Authority (MDBA) is the authority in charge of calling on the Goulburn system to deliver water to Murray customers.   When the MDBA starts to call on delivering the water from the IVT account, the 74,000 megalitres must be repaid first to take  the IVT limit under 200GL before trades can be permitted.

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Bulk Entitlements

A bulk entitlement is a right to use and supply water which may be granted to water corporations, the Victorian Environmental Water Holder and other specified bodies (eg electricity companies). Bulk entitlements allow for the delivery of all required water within the system including high and low reliability shares as well as variable and fixed loss allowances and supplies by agreements. Bulk entitlements are announced every year prior to the start of the Irrigation Season.

Farming Ownership Structures

Every farm business operates within an ownership structure that can be complex given your circumstances. Water being a separate asset to land is also affected by this structure and as such is an important part of business planning. We can help align your water share and delivery shares with your business and land structure for easy succession with your business.

Spillable Water Accounts, Subdivision of Water Shares & Carryover

Spillable Water Accounts

If you carry water over from one irrigation season to another, you risk the Dam ‘spilling’ and losing your water entitilements. There is no guarantee as to access of water over your 100% allocation but the water is recorded in your ABA as ‘spillable water’. You cannot use or trade your spillable water until the Resource Manager makes a low risk of spill declaration.

Subdivision of Water Shares

Water delivery shares are associated with property titles, in the subdivision of land the allocation of the delivery share needs to be considered. This can involve subdividing the delivery share into unit shares. Conditions on your water use licences are different for specific areas of land and this can effect your water use and irrigation processes.

Carryover

As a water share owner, you hold space within the Dam which allows you to hold water from the unused allocation from one irrigation season to another. This will carryover in your ABA from one season to the next. There are rules associated with carryover to ensure that you do not use space within the Dam locking up space for other incoming water for allocation in the new season.

Modernisation

There is a great deal of investment into the modernisation of irrigation districts in the past years to save water and transform the system form a manual to an automatic system. Modernising irrigation systems may involve automating and upgrading channels, rationalising and decommissioning redundant channels, constructing pipelines, upgrading the accuracy of metered outlets to farms and lining and remodelling channels.

The modernisation project originally commenced under the name of NVIRP (Northern Victoria Irrigation Renewal Project). In recent years the project has been handed over to Goulburn Murray Water to manage. The project is currently known as theGMW Connections Project.

Allocation Bank Account – ABA

Allocation is held in what we call an ABA – which stands for Allocation Bank Account. ABA account keeps track of allocations available and any water that you use or trade. ABA’s are created with specific Delivery Source and Delivery Use attributes. As there are trading rules between the various systems and states, the Water Register looks at the ABA attributes prior to approving the trade.

Traditionally only water share owners could have an ABA account. As of 1st July 2014, as part of the Murray Darling Basin Plan, the rules changed and now anyone can apply for an ABA account. For example, a farmer operating in the Goulburn system can apply for an ABA in the Murray (Victorian) system without having to own Murray Water Shares on a permanent basis (and vice versa).

ABA account holders can order an ABA statement from the Water Authority. An ABA statement summarizes the transactions on the account, including an water carried over from previous season.

The Integra Difference

Integra prides itself on being a fully owned and operated business that cares for the success and ventures of every client. We prefer the personal approach and work quickly to assure you get the best value for your water and dollar. With our in house computer system we work to have the paperwork turned around in the day and our convenient location across the road from GWM allows for prompt lodgement of trades.

High Reliability vs Low Reliability

The storage dam holds a defined volume of water that is classed according to reliability. This means that a high reliability water share has a high chance of receiving full seasonal allocation, whilst a low reliability water share has a low chance of receiving full seasonal allocation.

In simpler terms, the first water that is captured in the new irrigation season is allocated back to the entitlement holder that owns high reliability water shares and when the high reliability water shares have reached 100% allocation and existing commitments satisfied, then the Resource Manager will look at seasonal allocation for low reliability water shares.

Trading Rules, Forward Markets & Ordering Water

Trading Rules

Trading rules exist and are amended by the Minister for Water to ensure that trade is encouraged with no negative impacts to other users within the system or the environment. The basis of the trading rules are whether a water entitlement in one catchment or system can be delivered to another system, and act to assist the Water Authorities in ensuring this occurs.

Forward Markets

Forward water is the ability to purchase water allocation water (temporary) in future irrigation seasons at an agreed price and an agreed time frame. This allows for planning of budgets and cropping with assurance as to water price and delivery. The buyer risks paying a premium price for water but considering the volatility of the market, can be a comforting plan for your business.

Ordering Water

Each Water Authority has a Watering System that allows you to either log in or call up to order Water. Modernised systems require 48 hours for water delivery whilst modern systems only require 24 hours. These systems allow for you to monitor your ABA Account and better manage your water requirements with the Water Authority.

Delivery Shares

A delivery share is an entitlement to have water delivered to land in an irrigation area. It gives you access to a share of the available capacity in the channel or piped network that supplies water to your property. A Delivery Share is defined by a rate of megalitres per day (ML/day).

A delivery share is tied to the land and stays with the property if it is bought or sold. Delivery shares do not transfer off the land when the water shares are sold.

In July 2006, 12 months prior to the unbundling of land and water, Goulburn Murray Water introduced the rule that when water shares (previously called permanent water) were sold off the farm, the infrastructure costs stayed with the farm. Infrastructure costs referred to the cost of the channels/piping of the water. Once land and water unbundled in July 2007, infrastructure costs were renamed to Delivery Shares.

The benefit of a Delivery Share is that in periods of high demand on a channel system, the delivery share rate is used by the Water Authority to determine how deliveries are rationed.