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Australian water markets

​​​​​​​​​​​​​​​Water markets are a key mechanism by which Australia manages water scarcity while still supporting economic growth. While state and territory governments are responsible for water licensing and trade rules, the Australian Government has a leadership role to coordinate actions to improve the efficient operation of water markets.

ACCC review of the water charge rules

In response to recommendation 11 of the Independent Review of the Water Act 2007, the then Parliamentary Secretary to the Minister for the Environment wrote to the Australian Competition and Consumer Commission (ACCC) requesting advice on possible amendments to the water charge rules.

The Minister for Agriculture and Water Resources has received the ‘ACCC’s Review of the Water Charge Rules: Final Advice’. Further information on the ACCC’s review is available on the ACCC’s website.

On 15 November 2016, the Minister announced his intention to adopt the ACCC’s Rule advice 5-L to remove the requirement for operators to prepare Network Service Plans by repealing Part 5 of the Water Charge (Infrastructure) Rules 2010.

Download

DocumentsPagesFile typeFile size
Minister's notice​ 6Word 132 ​​KB
ACCC Review of the Water Charge Rules: Final Advice403PDF 4.47 MB
ACCC Review of the Water Charge Rules: Final Advice​ 403Word 1.32 MB

If you have difficulty accessing these files, visit web accessibility for assistance.​

On 31 January 2017, following the public notice period, the Minister made the Water Charge (Infrastructure) Amendment Rules 2017 to repeal Part 5. The rules are now in effect with the operative provisions commencing on 1 July 2017. This commencement date allows the current regulatory framework to run its course, with the current Network Service Plans remaining in force until they expire on 30 June 2017.

The Minister will continue to consider the remaining Rule advices and recommendations proposed by the ACCC, which include examining the streamlining of rules, water pricing transparency and customer engagement.​

Australian water markets reports

The Australian water markets report is the most authoritative annual national statistics on water markets, including water entitlement trade and water allocation trade volumes and prices, trade processing times and environmental water holdings and trade. The report summarises water trading activity within surface and groundwater systems across Australia, with a particular focus on the Murray-Darling Basin region. The report series is currently being prepared by ABARES, who took over from the former National Water Commission.

History of Australian water markets

The development of Australia's water markets represents a centrepiece of national water reform. Water markets and trading have played a significant role in allocating scarce water resources.

Water purchasing in Murray-Darling Basin

Restoring the Balance in the Murray–Darling Basin

This programme aims to purchase water entitlements from irrigators, which can then be used to improve the health of the Basin's rivers, wetlands and floodplains. This is part of a long-term strategy to provide a permanent rebalancing between consumptive water use and the environment.

We regularly report on the programme:

Market prices for Murray–Darling Basin water entitlements

We publish monthly water price market reports (previously quarterly), compiled by independent consultants, to help irrigators and interested parties identify the prices being paid for Murray–Darling Basin water entitlements.

Basin markets and rules for interstate water trading

Water market trade in the Murray-Darling Basin is regulated under the Basin Plan water trading rules, which came into effect on 1 July 2014.

The rules provide greater clarity and consistency for the operations of the water market in the Murray–Darling Basin and aim to ensure free trade in surface water, except where there are defined allowable restrictions. The rules also require information to be readily available about the characteristics of different allocations and entitlements, trading prices and the trading rules used by the states and irrigation infrastructure operators, among other requirements.

Rules for interstate water trade

The Murray-Darling Basin Authority provides information and guidelines on the Basin Plan water trading rules, including rules for interstate water trading.

Supply side drivers of water allocation

The Australian Government has commissioned a report on supply-side drivers of water allocation prices in the southern Murray-Darling Basin.

The report seeks to develop greater understanding among market participants of the range of factors affecting allocation prices, including climatic conditions, water allocation decisions and Commonwealth water purchases.