Efficiency Measures

What are ‘Efficiency Measures’?

Efficiency measures are activities that change water use practices and save water. They are integral to the Basin Plan’s sustainable diversion limit adjustment mechanism, which is in place to benefit the environment and communities across the Murray-Darling Basin.

Efficiency measures make more water available for the environment through water efficiency projects in agriculture, water delivery, industrial and urban settings. Projects such as upgrading irrigation systems, lining water delivery channels or installing water meters are eligible, along with water productivity improvements in manufacturing or irrigated agriculture, or changes to urban water management practices to reduce water use.

Efficiency measures projects are required under The Basin Plan 2012 (Cth) to have neutral or positive social and economic impacts.

Water saved through efficiency projects will be used as environmental water; forming part of the Commonwealth environmental water holdings.

The evaluation of proposed efficiency measures projects will take into account the contribution the proposed water savings would make to the enhanced environmental outcomes set out in Schedule 5 of the Basin Plan.

Current Programs

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Water Efficiency Program

The Water Efficiency Program (the program) is a Basin-wide initiative to recover environmental water through efficiency measures projects.

Participation in the program is voluntary. In return for funding water efficiency infrastructure projects, participants transfer an agreed volume of water savings to the Commonwealth in the form of eligible water rights. Maximum funding for each project will be calculated at 1.75 times the market price of the water rights transferred to the Commonwealth. Any additional water savings generated by the infrastructure upgrades can be retained by the program participant.

About $1.4 billion has been set aside from an overall budget of $1.575 billion from the Water for the Environment Special Account (WESA) to fund the recovery of 450 GL of water through efficiency measures projects.

The program does not involve direct purchase of water rights by the Commonwealth and is designed to deliver neutral or positive socio-economic outcomes for the Basin and its residents.

Information about the program can be found on the Water Efficiency Program website.

Commonwealth On-Farm Further Irrigation Efficiency Program–South Australian pilot

The South Australian pilot of the Commonwealth On-Farm Further Irrigation Efficiency (COFFIE) program provided funding for upgrades to irrigation infrastructure, as well as other activities that improved the productivity of the farm business. This program closed to new applications in 2018. See Commonwealth On-Farm Further Irrigation Efficiency Program – South Australian pilot for details.

Supporting the recovery of efficiency measures

The Australian Government is implementing a package of commitments to complement and further support full implementation and delivery of the Basin Plan.

The package includes initiatives to support the recovery of efficiency measures. Efficiency measures initiatives include the launch of the new Murray-Darling Basin Water Infrastructure program on 13 July 2018.

National Partnership Agreement on Implementing Water Reform in the Murray-Darling Basin

The Australian Government has committed to linking payments for the delivery of supply measures under the Sustainable Diversion Limit adjustment mechanism to the roll-out of efficiency measures.

These arrangements will be described in the performance milestones under funding agreements with Basin States.

Water for the Environment Special Account reviews

The Water Act 2007 provides for two independent reviews of the WESA in 2019 and 2021. These reviews will assess progress that has been made towards recovering environmental water and whether the funding in the account is sufficient to meet its objectives.

Independent review of Efficiency Measures

At the request of the Murray-Darling Basin Ministerial Council (Ministerial Council), an independent review by Ernst & Young (EY) was commissioned in 2017 on how best to design, target and resource efficiency measures for the Sustainable Diversion Limit adjustment. EY drew on the knowledge and experience of an Advisory Panel and engaged extensively with stakeholders across the Basin to prepare the report. The independent analysis was delivered to the Ministerial Council and publicly released on 19 January 2018. The report identified that the recovery of 450 GL of efficiency measures water is possible in a socio‑economically neutral or positive way.




File size

Terms of Reference for Analysis of Efficiency Measures PDF 


86 KB

Terms of Reference for Analysis of Efficiency Measures DOCX 


27 KB

EY Report: Analysis of Efficiency Measures in the Murray-Darling Basin PDF 


5.3 MB

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

Want to know more?

Further information on the relationship between the Sustainable Diversion Limit and efficiency measures can be found on the Murray Darling Basin Authority’s (MDBA) website. The MDBA is also required to maintain a register of the volume of water recovered by efficiency measures programs. This register is in accordance with The Basin Plan 2012 (Cth), and available on the MDBA’s website.

Last reviewed: 12 October 2020
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