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Potential Demands for Waitaki Catchment Water (non Hydro, Irrigation or Stock)

Executive Summary

1 Introduction

2 Methodology

3 Discussions and Interviews Summary

4 Water Conservation

5 Results and Recommendations

References

Applicability

Appendix A: Potential water demands from significant catchments - consents data

Appendix B: Potential water demands including out-of-catchment - recorded flow and population data

Appendix C: Demand growth summary information

Appendix D: Seasonal variation of water demand by consumer type

Appendix E: Classification of use codes from Environment Canterbury consents database

Appendix F: Catchment numbering for significant catchment analysis and LINZ land parcel summary

Appendix G: Unproductive land use descriptions from LINZ DCDB

3 Discussions and Interviews Summary

3.1 Territorial local authority discussions

The territorial local authority interviews provided the bulk of the information for evaluating the existing and future water demand types, including their approximate locations.

Mackenzie, Waimate and Waitaki district councils preside over the Waitaki Catchment itself. However significant existing and future water demands are likely to originate out-of-catchment. These areas are administered by councils further a field such as Timaru District Council and Dunedin City Council. Interviews with these councils have revealed concerns that a number of the communities under their administration are water short presently, or are likely to be water short in the future.

The majority of our discussions with territorial local authorities suggest that formal investigations of regional water sources are ongoing. A better understanding of future water requirements at a community level will be established after the Water and Sanitary Services Assessment required by the Local Government Act. This assessment is due for completion prior to June 2005.

A number of territorial local authorities have established, either by formal planning or from in-house knowledge, that their existing water sources will be adequate for the next 10-35 years Beyond those times to the project horizon of 2051, reliable estimates of future demands have not been established. Where councils have identified a future need or are uncertain if a need will arise, access to a Waitaki water source is preferred. The central issues identified by councils as a result of the interviews have been summarised below.

Discussions with both Otago and Canterbury regional councils were helpful in establishing where alternative water supply sources to the Waitaki River may exist.

The principal data sources collected from the councils (where available) were based upon a review of:

• district and regional economic development strategies
• asset management plans
• community outcomes and long-term council community plans
• tourism development planning
• liaison with other tourism and development interests
• recorded flow and consumer data (where available).

3.1.1 Mackenzie District Council

Documents provided by the Mackenzie District Council that were reviewed have been listed in the references section of this report. These documents were used to determine the location of council municipal and rural water supplies and to establish other significant water demanding activities that are likely in the future.

The Mackenzie District Council was able to provide actual flow data for the two town supplies in the catchment (Twizel and Tekapo) and this enabled us to identify both the summer peak and total annual demands.

The information listed below is a compilation of the summarised interview notes and relevant points raised in the documentation reviewed. From these we have established that increased future water demand is likely to result from:

• continued subdivision development for holiday homes and tourist accommodation and supporting industries
• continued development of adventure tourism-based activities and other seasonal events such as the Maadi Cup rowing regatta (especially around Twizel)
• establishment of limited olive and/or wine producers around MacKenzie Basin
• a 1000 bed holiday accommodation at Pukaki is likely to be established in the next 15 to 30 years
• further development of forestry within the district is likely. This may be a council led initiative and planting estimates of 1000 hectares per 10-year cycle has been suggested. This rate of planting may continue to a maximum of 3000 hectares in approximately a 30-year timeframe.

3.1.2 Timaru District Council

The Timaru district is outside the Waitaki Catchment and information provided by the Timaru District Council (TDC) has been used to assess whether out-of-catchment demands are likely, and to comment on the most probable growth industries.

Documents provided by the council that were reviewed have been listed in the references section of this report. These documents were used as a reference for future growth trends in the South Canterbury area.

The information listed below is a compilation of the summarised interview notes and relevant points raised in the documentation reviewed. From these we have established that increased future water demand is likely to result from:

• using water from the Waitaki Rivers as a possible future source of water for the communities of Geraldine, Temuka and Pleasant Point and three other rural schemes that the council administers. This would depend upon demand growth of these communities and the further development of irrigation schemes from Opuha dam. The reasoning behind the link with irrigation is that of economics, as water available from an upland water race is preferred over pumping schemes
• upon reviewing the council's population growth forecasts, however, there is no significant growth predicted in the short to medium term
• enhancement of land productivity and development of primary production industries in the short term (development of existing vegetable and dairy industries), with intensified development of horticultural and functional foods processing industries in the medium to long term.

Recorded annual flows and peak demands from the Timaru District Council activity management plan (water) were useful for confirming per person flows and peaking factors applied to other coastal townships.

To some extent growth in the above areas will depend on additional irrigation schemes in South Canterbury and, as such, a quantitative assessment of industry growth will be very subjective.

Aoraki Development Trust (ADT) is a subsidiary business unit of the Timaru District Council and provided economic development information for this report. Some of its statements are listed below:

• To maximise the potential for economic growth, the amount of water allocated to a geographical area must leave room for land use changes that will occur in the future, such as conversion of arable land to dairy and horticulture. These land use changes will make it possible for the development of additional (wet) food processing industries. From a regional perspective, Aoraki Development Trust would like to see South Canterbury's "options left open" with respect to having water available for these processing industries.
• South Canterbury's economic growth has been two to four times the national average in recent years and this trend is expected to continue.
• Population growth is likely to mirror economic growth. This suggests that the Statistics New Zealand local growth projections may understate potential growth and is one of the reasons for adopting the New Zealand national population growth projections.
• ADT is about to commission an economic development study to determine the effect of Opuha dam and irrigation on the South Canterbury economy. This study may be useful to determine changes in water demand from processing and related industries.

3.1.3 Waimate District Council

Documents provided by the Waimate District Council that were reviewed have been listed in the references section of this report. These documents were used to determine the location of council municipal and rural water supplies and to establish other significant water demanding activities that are likely in the future.

Waimate District Council was able to provide actual flow data for the two council administered rural supplies in the catchment (Waikakahi and Lower Waihao) and the community of Waimate itself. This enabled us to identify both the summer peak and total annual demands. Two private schemes are shown in the Hakataramea Valley (Hakataramea and Cattle Creek); however no operational information for these schemes was collected.

The information listed below is a compilation of the summarised interview notes and relevant points raised in the documentation reviewed. From these we have established that increased future water demand is likely to result from:

• similar growth industries as outlined by the Aoraki Development Trust (see Timaru District overview above); specifically, further growth of the vegetable processing and dairy industries
• private speculation in the Hakataramea for viticulture has prompted the council to recognise this as a possible future industry
• council believes dairy industries that are currently taking over pastoral land will ultimately lead to development of horticulture and will require dramatic increases in the water required for stock.

To some extent, growth in the above areas will depend on additional irrigation schemes in South Canterbury and as such, a quantitative assessment of industry growth will be very subjective.

The council also raised some of its concerns and raised some of the following issues:

• The council is concerned that Waimate groundwater bores may be hydraulically connected to the Waitaki River and that these may be subject to restrictions in the future. The management plan put in place by the board should provide a mechanism to allow for changing water needs and use within a district.
• Should Timaru District seek to take further water from the Waimate region in the future, will this limit the water available for development in the Waimate District?

3.1.4 Waitaki District Council

Additional and revised comments have been requested by the council following a review of the draft report. Revisions are shown in italics.

Documents provided by the council that were reviewed have been listed in the references section of this report. These documents were used to determine the location of council municipal and rural water supplies and to establish other significant water demanding activities that are likely in the future.

Waitaki District Council administers 23 public water schemes of which four community and two rural supply schemes are within the Waitaki Catchment. These are located at Lake Ohau, Kurow, Omarama, Otematata, Duntroon and Lower Waitaki. The council provided estimated flow information that was generally consistent with the demands calculated for other communities within the catchment such as Twizel and Waimate.

The information listed below is a compilation of the summarised interview notes and relevant points raised in the documentation reviewed. From these we have established that increased future water demand is likely to result from:

• Similar growth industries as outlined by the Aoraki Development Trust
• Irrigation schemes for the Waitaki downlands and the upper catchment will promote economic growth and create additional demand for water both on-farm and in local service centres. Such schemes are proposed by the North Otago Irrigation Company (18,500 ha) and irrigation above Benmore (8000 ha).

The council believes that horticulture industries that are currently being developed in Oamaru (Nikken Seil Co Ltd) will continue at the expense of the existing pastoral land use.

To some extent, growth in the above areas will depend on additional irrigation schemes in North Otago and as such, a quantitative assessment of industry growth will be very subjective.

Tourism and conference commercial activities may be attracted to the region (especially Oamaru) with development of the heritage areas.

The council believes that there is an increasing demand for property as holiday homes and for recreational activities in the upper catchment. This trend is also evident south of Oamaru where there is significant demand for subdivision development.

The council also raised some of its concerns and the following issues:

• Many of the existing supply schemes are having difficulty gaining resource consents for expanding capacity and this is preventing subdivision development.
• Recent responses from the regional councils (Otago Regional Council and Environment Canterbury) regarding increasing water takes have indicated that additional quantities may not be able to be guaranteed. This is a serious management problem and has lead the council to refuse expansion of some schemes.
• The council believes that many previous studies regarding land development potential have not considered areas south of the Waitaki River to the same extent as areas to the north.
• Due to the semi-arid climate of the Otago interior and the lack of further water allocation, it is likely that development of communities south of Oamaru will depend on water from the Waitaki river.
• Desalination is considered to be an impractical and very expensive alternative water source and is unlikely to be economic.
• The council believes that their existing water take from the Lower Waitaki Irrigation Company (LWIC) scheme is adequate to supply the Oamaru community for a further 10 years. Additional water will be required to supply the communities of Kakanui, Maheno and Weston.
• The council's broad estimate of the water required to supply the district communities (inside and outside the Waitaki River catchment) and communities in the Dunedin City district (Waikouaiti, Warrington, Waitati and Dunedin City) is 10 cumecs. The figure of 10 cumecs includes demands for stock water. Figure 2.2.1a in Section 2 suggests that consented flows for stock water may exceed community, industrial, tourism demands by approximately 10 times.
• The council is in the process of completing its water and sanitary services assessments required under the Local Government Act 2002; this includes estimating district water requirements from the Waitaki Catchment.
• The council also intends to investigate viable strategies of meeting the projected demand including better water management techniques.

3.1.5 Dunedin City Council

The Dunedin City district is well to the south of the Waitaki Catchment and information provided by the council has been used to assess whether out-of-catchment demands are likely.

Documents provided by the council have been listed in the references section of this report. These documents were used as a reference for future growth trends in the Dunedin area.

The information listed below is a compilation of the summarised interview notes and relevant points raised in the documentation reviewed. From these we have established the following:

• Dunedin has an established process for determining its future water demands and existing supply sources are thought to be relatively secure with capacity likely to be sufficient for the projected 50-year period.
• The need for an alternative water source would further increase security of supply (ie, to prevent summer drought shortages), and likely alternative supplies to be investigated could be:
  • Lake Mahinerangi (approximately 30 km distance from Dunedin)
  • Clutha River at Balclutha (approximately 75 km distance from Dunedin)
  • Waitaki River via State Highway 1 (approximately 130 km distance from Dunedin)
  • desalination.

Water shortages or treatment issues may arise in the future that will have to be considered. Presently the council is investigating options to supply treated water to the northern communities of Waitati, Warrington, Karitane and Waikouaiti. Options may be to supply from Dunedin's existing water treatment plants (WTP) or, if available, a Waitaki water source from the north.

The northern communities are likely to require additional water for the projected population growth and industrial uses. Review of Otago Regional Council water allocation information shows that ground and surface water is very limited in the area and that reduction of consent flows may be encouraged in the future. These reductions will be in order to increase stream health below the existing raw water intakes. If these communities required treated water from a piped source then a pipeline from Dunedin appears logical.

Alternatively a pipeline could be extended from the Waitaki River (or in conjunction with irrigation such as the proposed Downlands scheme). This may rely on a joint venture with Waitaki District Council to serve the Waitaki district's southern communities. This alternative may require additional treatment infrastructure and may be less favourable hydraulically given the large distances and the potentially large capital infrastructure costs.

When considering this information in light of the present location of council infrastructure (namely water treatment plants in the city's south west) it seems unlikely that Dunedin City would use the Waitaki as a source to ensure security of supply.

3.1.6 Otago and Canterbury Regional Councils (ORC and ECan)

The regional councils have been an invaluable source of information regarding regional water policy objectives, water availability and current projects to establish water availability.

3.2 Industry, commerce, tourism and recreation discussions

3.2.1 Industry and commerce

The most significant off-farm 'wet' industries were identified as:

• milk and dairy processing
• meat works and meat processing
• vegetable, food processing and horticulture.

Phone discussions with representatives from the dairy and meat processing industries were documented. Because the vegetable, food processing and horticulture sector is so diverse it was not possible to find a single representative industry to derive useful comments from. It may be appropriate to carry out a further study to establish industry specific water demand trends for this sector.

The discussions held were useful to determine the typical yearly demand regimes and the expected future growth of the respective industry. Documents provided by industry representatives and those researched independently that were reviewed have been listed in the references section of this report.

The information listed below is a compilation of the summarised interview notes and relevant points raised in the documentation reviewed. From these we have established the following.

Locations of significant wet industries

Very little industry is actually located within the Waitaki Catchment itself and most processing occurs on the Otago and Canterbury downlands, which are closer to the trade centres of Timaru and Oamaru. There is one exception to this rule, the freezing works at Pukeuri located near the catchment's southern boundary on State Highway 1.

Meat works and meat processing

The operating season for meat processing is very site specific. Plant operating seasons throughout New Zealand may vary from just a few months over the summer to year-round operations at varying proportions of total plant capacity. The length of operating season depends on climatic conditions, species of animal being processed and market requirements (including food safety and client requirements). Meat processing plants close to the Waitaki Catchment operate almost year-round, processing multiple species and a winter kill. It is likely that meat processing plants located close to the Waitaki Catchment will have similar seasonal operating profiles.

Although the industry is constantly looking at ways to reduce water use in its operations, gains made are often offset by the need to meet regulatory requirements administered by NZFSA-VA and overseas customer requirements relating to food safety and hygiene.

Milk and dairy processing

The operating season for dairy processing is more uniform across New Zealand plants. The operating season may generally range from eight to 10 months beginning in August/September. Peak capacity may be achieved by late October and continue until February/March. The main factors affecting water consumption are the type of products and the processes used. For example cheese production is far more water intensive than milk powder production, which actually creates relatively clean water that can be employed for other uses.

If the milk and dairy processing industry were to expand operations in the future it is likely that less water would be used per tonne of product. This is likely if the production of milk powder continues to expand in preference to cheese and other water intensive dairy products. However, given that it is relatively uncertain to what degree the existing processes may change, a conservative approach to future water demand growth is appropriate. For the purposes of this report we will assume that minimal water efficiencies will be gained as plants expand in the future and that the water required per tonne of product may reduce by up to 10 percent in the long term.

Charts of indicative seasonal operating profiles for the meat and dairy processing industries are shown in Appendix D.

3.2.2 Tourism and recreation

Much of the tourism and recreation activities will use water from community and domestic supplies. Therefore increased tourism in the Waitaki Catchment will most likely result in some additional demand from communities, especially around the lakes and west of Kurow. However this will probably be in much the same relative proportions as is already being accounted for in total community demand.

Snow making is the largest consumer of water for the tourism and recreation sector outside of community and domestic reticulated schemes. Discussions were not held with local operators; however some general details of snow making in New Zealand are listed below. These details have been used to generate seasonal patterns of demand.

• Snow making is used as a secure means of providing snow during the season and as a means to extend the length of operation. Earlier opening dates can be achieved by supplementing natural snow with snow making during June and July. This then translates into later closing dates in September and October.
• Snow making can theoretically operate throughout the season whenever temperatures allow; however this is not necessary when natural snow is abundant.

A diagram of the indicative seasonal operating profile for the predominant tourism/recreation use (snow making) is shown in Appendix D.