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The Murray-Darling: Running Dry – A Market Based Conservation Failure? May 24th, 2018
Courtesy of The Economist (subscription required), a look at how Australia’s biggest river is running dry, despite plans to use market mechanisms to save it:
PADDLE steamers once chugged up and down the Darling, the main tributary of the Murray river, ferrying wool from remote farms to the port of Adelaide. The Murray-Darling basin, which is larger than Ethiopia, gives life to Australia’s arid interior (see map). But these days the Darling is reduced to a putrid standstill with alarming regularity. Parts of it disappear altogether at times, a phenomenon which was almost unprecedented before this century. Robert McBride, whose parched sheep station in the state of New South Wales depends on its flow, estimates that 600km of the lower Darling will run dry this year.
This is just the kind of disaster that should have been averted after Australia launched an ambitious plan to preserve the river in 2012. The four states that depend on the Murray and its tributaries had been fighting bitterly over its contents. Since the 1970s enormous farms growing irrigated crops such as cotton and nuts had spread across the basin. When a catastrophic drought struck in the early 2000s, the mouth of the river almost ran dry. So politicians thrashed out a plan to conserve the river, while sustaining the farms and communities that depend on it.
Australia already had an elaborate system for trading water rights, allowing farmers to buy or sell entitlements according to their need in any given season. The idea of the Murray-Darling Basin Plan was to reduce water consumption by at least 2,750 gigalitres a year, either by purchasing water licences from farmers who were willing to sell them or by funding projects which could deliver “equivalent” outcomes—for instance, by making irrigation systems more efficient. So far, the government has spent over A$8bn ($6bn), and in theory cut usage by two-thirds of the target. Yet, somehow, the river is still at a low ebb.
The first independent review of the plan, published last year by the Wentworth Group of Concerned Scientists, found “no evidence yet to demonstrate improvement across the basin as a whole”. Another report, by the authority which administers the scheme, concluded that irrigation in the basin’s upper reaches was still depriving those farther downstream, like Mr McBride, of water. Richard Kingsford, a scientist in Sydney, says that the plan’s targets were not ambitious enough in the first place. But it also seems that more water is being siphoned from the stricken river system than was intended.
Theoretically, water saved with taxpayers’ money should stay in the river. But not all of it does: the Wentworth Group says state governments use several tricks to “retard” that process. Victoria hoards water in dams. New South Wales has altered local water-management schemes along the Darling’s tributaries, allowing irrigators to pump out more. This means that liquid purchased by the government in Queensland is guzzled back up again when it crosses the state border, explains Jamie Pittock, a member of the group.
Illegal extraction is a second problem. Farmers are meant to use meters to monitor how much they pump. But last year, cotton irrigators in New South Wales were accused of tampering with their machinery to mask how much they were taking. Two families face charges associated with breaches of their licences. There is also concern that money which was supposed to fund projects that would conserve the Murray-Darling is being misspent, allowing irrigators who have sold water to the government to replace it with flows to which they are not entitled. One big cotton farm is currently under investigation.
Wide-scale abuse has been possible because states and local governments have failed to enforce the rules. Last year, New South Wales’s top water bureaucrat was caught on tape offering to share confidential information with irrigation lobbyists. (He was referred to the state corruption watchdog.) From the shelter of his veranda, Mr McBride fumes that “the greatest man-made destruction in Australian history is being condoned by New South Wales and the federal government.”
The federal government has handed oversight of the plan to the farm-friendly National Party, the junior partner in the governing coalition. Since then, critics claim, regulatory oversight has slackened. The Environmental Defenders Office NSW, a pressure group, notes that there is no legal bar to stacking the board of the authority in charge of the plan. Four of its six members have links to the irrigation industry.
Parliament recently ordered the publication of details of a series of “buy-backs” of water rights. In one case, the government spent A$78m—almost twice the sum recommended by its own researchers—on a water licence belonging to an agricultural company, Webster. The purchase was not put to a public tender. Webster had taken over Tandou Limited, which owns the property in question, only 18 months earlier. Nick Xenophon, an independent senator at the time, complained that the plan was being “systematically undermined”.
This month the Senate approved an amendment to the plan which lets communities in the southern part of the basin consume more water. The extra consumption is supposed to be offset by 37 “efficiency-saving” projects. New South Wales had threatened to abandon the plan altogether if the amendment failed. But the Wentworth Group questions whether the projects will really deliver the promised savings; it believes that only one of them is watertight, as it were.
Communities which rely on irrigation detest the plan because it threatens their livelihood. Yet their thirst hurts farmers downstream. Indigenous tribes who imbue the river with spiritual significance say that their elders are dying with it. Scientists worry about the loss of fish and birds. The Coorong, an important wetland near the river’s mouth, has been polluted with salt and algae as the river’s flow diminishes. David Paton, an ecologist, has spent decades monitoring its fairy terns. Their numbers are a quarter of what they were in the 1980s. “We’ve pushed this system to the point of collapse,” he laments, “and we’re watching the species go to extinction.”
Hope comes in the form of greater accountability. Overwhelming evidence of theft and mismanagement has led to more prosecutions. New South Wales has established a new regulator, and South Australia has launched a royal commission to look into breaches of the plan. If state governments walk away, the national government could, by law, enforce the rules instead—if it were so inclined.
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Based on decades of experience and interest in conservation, Monty Simus and Jamie Workman believe that a truly “smart” grid must be a “transactive” grid, unshackled from its current status as a so-called “natural monopoly.”
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