mmg.com.au

Five years years after 75Gl of Eildon water was set aside for Melbourne urban consumers, the three Melbourne retail water authorities are selling back some of the water to northern Victoria.

Improved urban dam levels mean City West Water, South East Water and Yarra Valley Water now have plenty of water and so they are selling back up to 22Gl of temporary water over the coming months, for the first time.

The sale has also been spurred on by new carryover rules which prevent some water from being transferred to next year.

With Melbourne’s storages at 75 per cent full, the water is not needed in Melbourne and the water sales will not affect Melbourne’s future water supplies.

Yarra Valley Water’s managing director Tony Kelly said the retail water corporations would sell packages of their water allocation through water exchanges and via a panel of water brokers.

Mr Kelly said the water corporations were committed to being responsible market participants.

The revenue derived from these sales will be used to offset the water corporations’ annual water storage charges in the Goulburn and Murray systems.

Mr Kelly said they were now only able to carryover their current entitlement of 40Gl to the next financial year.

‘‘We will sell packages of our water allocation through water exchanges and via an appointed panel of water brokers,’’ he said.

‘‘We expect that the water will be sold using a variety of methods.’’

Trading will be recorded on the Victorian Water Register and reported in the water corporations’ annual reports.

The water brokers will have to be members of the Australian Water Brokers Association.

This water comes from Melbourne’s share of water savings received to date from the water corporations’ $300million investment in Goulburn-Murray Water’s Connections Project (formerly NVIRP).

The 22000Ml will come onto the market around the same time G-MW is selling 20000Ml of permanent water it doesn’t want to hold.

VFF Water Council chairman Richard Anderson said he had met with the Melbourne water distributors and had agreed with the idea, but warned that the sale should be in parcels that made it accessible to as many irrigators as possible and the volume should be handled so that it didn’t artificially skew the market.

He wasn’t that surprised the water earmarked for Melbourne was being sold back as he said it was always a possibility.

Northern Victorian Irrigators chairman Barry Croke said the Melbourne authorities had paid the equivalent of about $13000/Ml for the water and they were never going to just sit on it if they had enough.

‘‘To me it was always bound to happen, that’s why I never got involved in Plug the Pipe,’’ Mr Croke said.

Melbourne was allocated the 75Gl through the controversial Sugarloaf pipeline after putting up $300million dollars for the construction costs of irrigation modernisation.

The water for sale won’t be coming out of urban dams (or back up the pipeline), it will simply come from the Melbourne allocation in Eildon.

The north-south pipeline, from the Goulburn River to Sugarloaf Reservoir, was largely funded by Melbourne water users. Water first flowed through the pipe in 2007.

Temporary water was selling for between $50 and $55/Ml on the Waterpool trading pool recently.

The Request for Proposal documents from water brokers will be made available to download on Wednesday, March 13 from South East Waters Tender website at www.tenders.net/sewl.html