Outcome 3 - Managing the Increasing Demands for Water and Encouraging Efficient Water Management
41. Increasing demand and competition for surface and ground water in some regions is resulting in less certainty for water users and the wider community. There is demand for water for extraction, as well as for water in its natural state (in-stream values and uses). In some over-allocated catchments, a lack of available water is putting the environment, industry and/or community development at risk.
42. The following package of actions aims to provide a more strategic, regionally consistent and effective approach to managing demand - especially on the most highly valued and allocated water bodies. Central government involvement will place a strong emphasis on avoiding further over-allocation, and will investigate how existing over-allocation could be addressed.
43. Government proposes to work with regional councils to enhance approaches to water allocation planning which will improve the available mechanisms for assessing protection and use. This builds on the public participatory processes of regional resource management planning.
44. Possible actions include investigating opportunities for increased national direction, working with local government to identify ways of supporting local decision making, and investigating longer-term projects with local government and stakeholders. These investigations are likely to identify some areas where practices could be improved through guidance and support, and other areas where legislative amendments to the Resource Management Act might be required.
Action 3.1: Scope and draft a national policy statement on managing increasing demands for water
45. Government wants to determine the scope of a national policy statement for managing the increasing demands for water. The intent is to explore how a national policy statement could offer water users greater certainty about how their values are provided for. Certainty is important for all economic, environmental, social and cultural uses and values. A national policy statement would include setting environmental flows, and could focus on catchments with a high level of allocation, and/or those with particularly important values.
46. The Government sees this as an opportunity to provide national policy direction on a growing and crucial issue - the allocation of water among competing activities - which regional councils are already grappling with. Amendments to the Resource Management Act in 2005 clarified that regional councils can allocate natural resources, including water. This strengthens their ability to address issues of water supply and demand through the development of regional plans and, more specifically, within allocation plans. Most regions have allocation plans. However, in many cases they do not allocate water to specific activities and values.
47. Ideally, allocation to activities allows broad community preferences to be addressed before, rather than after, any major increases in demand. A more robust, nationally-directed approach could provide certainty and clarity to all interested stakeholders, and reduce the possibility of decisions creating unintended consequences (for example, a lack of water for public supply).
48. The approach taken in the Waitaki Catchment Water Allocation Regional Plan is a good illustration of specific allocations of water to particular activities. [The Plan also sets environmental flow regimes for all water bodies in the catchment.] For example, the Plan directs water to be allocated to public water supply, to agricultural and horticultural activities, and to hydro-electricity generation. However, these groupings are unlikely to apply in all catchments, so it is not a case of one size fits all.
49. The need for a national policy statement, and its potential scope, would be determined through a collaborative process with local government and other stakeholders. There would also be opportunity for stakeholders to be part of a reference group [The process is likely to follow that used for the preparation of a national policy statement on electricity transmission. A reference group report on the possible nature and scope of a national policy statement would be released for public comment. The conclusions of the report and nature of public submissions would be reported to Cabinet prior to formal drafting and formal public consultation. If at any stage the reference group believes there would be a more effective alternative to a national policy statement, then that could be highlighted within the process outlined.] charged withscoping the statement. If Cabinet agrees to that a national policy statement should be prepared, formal public consultation would be required under the Resource Management Act (refer Appendix 2).
Action 3.2: Scope a national environmental standard on methods for setting environmental flows [See Action 3.6 for a discussion of the term 'environmental flows'.]
50. Setting environmental flows is well recognised both in New Zealand and internationally as a means of securing the amount of water needed in a water body to sustain environmental values. However, the methods to set environmental flows can be contentious and are often challenged in the Environment Court. Court processes can be costly and time consuming for councils and communities.
51. The Government proposes to establish the scope of a national environmental standard that could provide consistency and reduce conflict over appropriate methods for regional councils to set environmental flows. It would cover rivers, lakes, wetlands and groundwater resources. The development and implementation of any standard would require supporting science and guidance material and would possibly involve some re-direction of science funding.
52. The Government proposes to establish the scope of a national environmental standard that could provide consistency and reduce conflict over appropriate methods for regional councils to set environmental flows. It would cover rivers, lakes, wetlands and groundwater resources. The development and implementation of any standard would require supporting science and guidance material and would possibly involve some re-direction of science funding.
53. If the expected demand for water is low, a national environmental standard could endorse the use of simpler, quicker approaches to setting environmental flows. Conversely, where demand is high, a standard could emphasise the need to prevent over-allocation, thereby avoiding the need to review consented allocations due to retrospective increases in environmental flows. The standard could set default limits on how much water could be allocated in the absence of an adequate process to establish environmental flows. The standard could also be structured to concentrate effort on those water bodies with important values and large demands for water.
54. The Government proposes to assess the scope of a standard and whether it should apply only in areas where there is a high demand for water. This assessment will be undertaken through a collaborative process with local government, science agencies and other stakeholders. If it is recommended that a standard should be prepared and Cabinet agrees, formal public consultation will be required according to Resource Management Act provisions (see Appendix 2).
Action 3.3: Scope a national environmental standard on methods and devices for measuring water take and use
55. Inconsistent and variable information within and across regions about the volumes of water actually used (as opposed to allocated) presents a challenge for policy and decision making. Yet accurate information is a necessary precursor to more efficient water use and catchment management, and better understanding of water resources. It would also support Statistics New Zealand's work on valuing natural capital, as well as New Zealand's international obligations to report on the state of its natural resources.
56. While the benefits of measuring water use are known, introducing methods and devices to measure water use in a catchment can be contentious. Controversy could be minimised by introducing a national environmental standard that sets the methods, criteria and rationale by which councils could require water measuring devices for consented water takes. The standard would not deal with water use and take at a household level; it would concentrate on measuring water take and use at the point of intake from a river, stream, lake or groundwater resource.
57. Any national environmental standard would need to be accompanied by best practice guidance, developed in partnership with regional councils. Supporting material would make use of existing expertise on measuring devices, methods and guidance for use. It would also address issues of data collection, collation, use and provision of information to consent holders. Appropriate and cost-effective use of data is as important as requiring monitoring of water use.
58. The Government proposes to assess the scope of a standard, and whether it should focus on all larger water takes or apply only in areas where there is a high demand for water. This assessment will be undertaken through a collaborative process with local government, science agencies and other stakeholders. If it is recommended that a standard be prepared and Cabinet agrees, then formal public consultation will be required according to Resource Management Act provisions (see Appendix 2).
Action 3.4: Investigate current practice for transferring water consents
59. The Resource Management Act has always allowed the transfer of resource consents to take and use water (water permits) from one location to another within the same catchment. Amendments to the Act in 2005 provided for the temporary transfer of water permits within a catchment. A number of regional councils also enable transfer of water permits to another user through regional water plans. Recent Government submissions on the draft Waitaki Catchment Water Allocation Regional Plan, and on the Lake Taupo variation to Environment Waikato's regional plan for water, have expressed support for transferability.
60. Transfer of consent aims to make the best use of available water beyond that needed for environmental values. In the case of discharge permits, transfer provides a flexible way to keep cumulative discharge within defined limits. Transferability encourages efficient use, allows water to be shifted to where demand is higher, and can reduce tensions between water users and councils over the availability of the water resource. It is not a solution everywhere or at all times, but has the potential to yield significant environmental and economic benefits, especially in areas where water is fully allocated or nearly so, or where a water body has reached water quality limits . Making it easier to transfer a resource consent could allow available water to be more efficiently shared and used, and also reduce pressure on existing water permit holders and on the environment.
61. The transfer of consents should complement the existing practice of allocating water by the 'first-in, first-served' process. The Government sees the use of transfers as a complementary tool needing further investigation as part of wider efforts to strengthen the water management framework.
62. Some water managers and water users consider that splitting the 'take' and 'use' parts of a resource consent might lead to greater use of the existing transfer mechanism. Splitting out the 'take' component would emphasise the different effects of taking the water from the water body (e.g. river, lake or aquifer) and encourage transfer of that part of the consent. At the same time, the site-specific effects of the use of the water would be considered in a separate consent. This approach could be more readily applied to catchments if there was consistent use of more standard conditions. [Refer also Action 3.10.]
63. The Government proposes to investigate current and emerging practices relating to the transfer of resource consents, and make recommendations for enhanced and sophisticated use of transfers. Experience in other jurisdictions and with other resources demonstrates that transfer can result in both environmental and economic gains, but there are many important details that need to be resolved. For instance reconciling consented water takes, actual use and ‘real’ available resource, and the need for good information systems. As the use of transfer increases, the Government wants to avoid any duplication of effort by councils, and ensure transparent and equitable practice.
Action 3.5: Explore the role of water user groups in managing water under cooperative management regimes
64. Following on from Action 3.4, the merits of giving water user groups increased authority to manage allocated water will also be considered. This may be a more viable option where demand for water is lower, or where there are fewer resource users involved. The Government will consider how a group of permit holders could be given the flexibility to manage their collective water take in a manner best suited to the local situation. At the same time, elected representatives and regional councils would need to ensure that environmental limits including community values were not compromised.
65. It is proposed to investigate both how water user groups could operate, and how the 'joint management agreement' provisions of the Resource Management Act could apply. These agreements are currently limited to agreements between iwi authorities, local authorities, statutory bodies or the Crown. Specific responsibilities could be transferred, such as monitoring of water takes, management of water sharing during low-flow times, or transfer of excess volumes within particular water bodies.
Action 3.6: Improve methodologies for applying environmental flows to water bodies
66. Currently councils secure environmental values using a range of mechanisms including, but not limited to, minimum flows and levels. Other mechanisms, such as allocation caps or seasonal volumes, are used for groundwater management and for ensuring flow variability. Similarly, maintaining flood flows is used as a means to preserve river character.
67. As the level of allocation increases, some stakeholder groups have become dissatisfied with the use of minimum flows as the sole protection method on rivers. [For example, the application for a Water Conservation Order on the Rangitata River did not seek to change the minimum flow set for the river but sought that the amount of water allocated from the river was capped (an allocation limit).] Consequently, even if a regional plan sets minimum flows, resource consent processes devote considerable time and expense to dealing with the other aspects of environmental flows, such as flow variability. This proposal aims to assess options for recognising the validity of all aspects of environmental flows within regional plans. It should encourage consideration of all flow aspects through planning processes.
68. The existing approach to setting environmental flows, with its concentration on minimum river flows, has sometimes failed to adequately specify how much water is available for allocation - an important foundation for allocating water to activities. It is proposed to investigate the use of the term ‘minimum flow’ within the Resource Management Act. Shifting the wording away from minimum flows to a broader concept of environmental flows could encourage thinking beyond low flows, and take into account the changing availability of the resource under all hydrological conditions - for example, variations in flows over a season.
Action 3.7: Develop criteria for determining nationally outstanding natural water bodies
69. Some water bodies have nationally important values that are under threat. These values are currently addressed as they arise by means of Government funding, special legislation or water conservation orders. There is no nationwide strategic or prioritised approach to determining such values, or to protecting nationally outstanding natural water bodies. This creates uncertainty for councils, industry and communities about whether nationally important natural values will be safeguarded into the future.
70. The aim is to achieve better protection and public awareness of these water bodies. Outstanding natural water bodies could be identified through a single strategic and consultative process, undertaken in partnership with local government, environmental, recreational and industry sectoral groups, Māori and other water users in the community. The first step would be to develop a set of criteria for consultation, followed by identification of water bodies worthy of high levels of protection. Once a list of nationally outstanding natural water bodies has been developed, the range of options for their protection would be considered.
Action 3.8: Develop improved methods for identifying and protecting natural character and biodiversity values
71. The Sustainable Water Programme of Action has already identified a set of water bodies that are nationally important because of particular values. This work exposed the methodological difficulties inherent in systematically identifying and describing freshwater biodiversity values, and in translating these values into a finite list of water bodies.
72. Government now intends to follow up options that have been proposed to improve these methodologies, in conjunction with local government, the Department of Conservation and science providers. The aim is to ensure that Resource Management Act processes allow representative biodiversity values to be considered.
Action 3.9: Develop methods for managing over-allocated catchments
73. Over-allocation occurs if there is insufficient protection for the environmental values of water bodies, and too much water is allocated to existing resource consent holders. This, in turn, creates a need to allocate water back to the environment. Similarly, a water body that does not meet its required water quality can be described as over-allocated because the level of contaminant inputs or discharges is higher than the river, stream, lake or groundwater system can deal with effectively. The Resource Management Act allows minimum flows/levels and water quality standards set through plans to be imposed on existing consent holders.
74. Government intends to explore whether existing mechanisms for addressing over-allocation of water resources need to be extended. Ways to adjust existing consents and how consent replacement is addressed in an over-allocated catchment will be examined. This includes considering possible alternatives to ‘first-in, first-serve’ allocation mechanisms, and other mechanisms for reallocation of consents - such as percentage reductions, and ‘grandparenting’ arrangements. Such measures, including the equity issues they raise, will be further investigated.
75. The investigations will include considering whether approaches like the 'cap and trade' approach used in Lake Taupo should be promoted as one means to reduce water take or contaminant inflows. The 'cap and trade' approach was established to ensure a percentage reduction over time of nutrients entering Lake Taupo. A maximum amount of discharge that could enter the lake was set, and the transfer of discharge consents between land users allowed for. The percentage reduction in nutrients will be set and transfer of discharge consents between land-users allowed for, but only within the bounds set by the cap on nutrient inputs.
76. The transfer of consents would occur within the total level of discharge allowed for the catchment (the cap). This approach could be more readily applied to other catchments where water quality is a problem, and could also be applied to transferring water use permits within set allocation limits for specific water bodies. Such approaches represent a transparent and flexible way of reducing adverse environmental effects.
77. This project will explore the benefits and costs of other tools that could be used by councils to address allocation when demand exceeds supply and there are competing applications for the last available water (a ‘gold rush’ for water). Such tools could also be appropriate in situations where water is ‘freed’ up when consents expire or environmental flows change. New approaches could provide councils with more flexibility to address allocation issues in such situations.
Action 3.10: Develop model resource consents and consent conditions for water
78. More efficient water use is likely when water take and use consent conditions are consistent and clear. If conditions are overly restrictive, they can inadvertently limit the potential for consent holders to transfer water.
79. Currently, water permits are issued in many different forms. Some grant a certain volume of water for a specified use, e.g. to irrigate land for grazing. Other permits are issued without stating a specific use, i.e. they simply specify the volume of water that can be taken. This mixture of approaches complicates catchment management and transfers.
80. Drawing on regional council experience, Government seeks to develop a best practice guide for consent structure and consent conditions. This would complement parallel investigations into transferability, and would include the concept of separating the 'take' and site-specific 'use' components of a water permit.
Action 3.11: Develop methods to assist regional councils to recover costs for water management
81. Under section 36 of the Resource Management Act, councils can charge for water management activities - such as investigations, resource monitoring, compliance with resource consent conditions, and other costs incurred in understanding the resource and the implications of its development. Financial contributions can also be required under section 108 of the Resource Management Act. However, councils cannot charge for the use of water. Some councils are examining their current funding of water management, including exploring their ability to charge for the management of water on a volumetric basis as a means to encourage more efficient use of water.
82. The Government intends to explore current and alternative options for funding water management, including whether the proportion currently paid by those who hold resource consents is appropriate.
