Sunday, 21 April 2013

Effective and efficient environmental water use

In my last post, I wrote about the way that environmental flows management is transitioning from policy, to implementation, to management. One of the fascinating aspects of the requirement for managing environmental water is that in addition to being effective, water use must also be efficient.

One of my favourite authors on this subject, Dr Avril Horne completed her PhD thesis on this topic. She used economic concepts of marginal benefit of additional water to the environment to figure out how to optimise the selection of flow components provided to a river or wetland. She generated environmental response curves for each flow component, which typically have an ‘S’ shape – very little benefit is gained below a flow threshold, then benefit increases as more water is provided, up to the point where benefit gained starts to level off, even when more water is provided (see the diagram below, loosely adapted from Dr Horne's work). This has two really important lessons for environmental water managers, as well as for politicians.

The 's' shape: relationship of environmental benefits to volume of environmental water 

Firstly (and this will likely not be news to many people reading this), benefits are not delivered in a linear fashion (Lin Crase has also written extensively on this), and won't measurably occur until after the first bend in the 'S' shape. This means that half the water may well have substantially less than half the environmental benefits, depending on where that volume of water gets you on the environmental response curve. For example, when bird populations breed in the Barmah Wetlands in the Murray, they do so in response to water levels. If the water then drops below the required level before breeding is complete, the nests will be abandoned. If environmental watering can’t be maintained until the birds have fledged, the benefit of using that water would be zero. The Victorian Environmental Water Holder has been using water in the past year to maintain required water levels for bird breeding events in Gunbower Forest and Barmah-Millewa Forest.

The understanding that thresholds must be met before any benefit can be realised is one that politicians can struggle with. Watching the way the new Murray-Darling Basin Plan operates will be interesting on many levels, but one of the most interesting things will be to see how this concept feeds into analysis of how effective the plan (and the accompanying water recovery) has been. The water provided under the plan is already less than that recommended to maintain the health of the Murray-Darling Basin.  If the benefits achieved are lower than we thought, we must consider whether we had sufficient water to exceed the lowest benefit thresholds.

Secondly, after the second bend in the 'S' shape, more water is no longer better, in terms of the benefits obtained per volume of water used. More benefit could potentially be obtained by using that water in another catchment, or to provide another flow component. Environmental water managers in Australia have never before had so much water requiring active management. At the Commonwealth level, most of the water entitlements held by the Commonwealth Environmental Water Holder are entitlements in storage, and these entitlements are incredibly flexible – access to interconnected water delivery systems and the water market means that water can be delivered to a wide variety of locations. Each decision to use water is also a decision not to use it somewhere else. As a result, environmental water managers must not only consider effectiveness, but also efficiency.

Transition to efficiency as well as efficacy is not easy, and depends on detailed understanding of the response curves of the environment. In many cases, this science won’t exist yet, and environmental water managers will be learning on the job. But as the industry matures, we should start to see efficiency playing a bigger role in environmental water decision-making.

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