RESPONSE The water trading rules provide that water access rights may be traded within a regulated system, between regulated systems, or within an unregulated system, free of any restrictions (including volumetric limits) on changing the location at which the water may be taken. However, the rules provide that certain types of restrictions may be permitted if they are necessary because of physical constraints, the need to address hydrologic connections, the level of hydraulic connectivity and water supply considerations, or for environmental reasons. Any allowable restriction must still be consistent with the general right to free trade of surface water. The commencement of the water trading rules on 1 July 2014 is consistent with the National Water Initiative which allows Victoria to maintain a 4 per cent limit on the volume of water shares each year traded out of irrigation districts in northern Victoria. An earlier commencement date would otherwise result in Victoria operating inconsistently with the water trading rules. Submissions queried whether the water trading rules permitted trade between regulated and unregulated systems. RESPONSE The water trading rules do not prevent trade between regulated and unregulated systems. The trade of these rights remains at the discretion of state governments. Submissions expressed concern that groundwater trading rules were too prescriptive. RESPONSE The rules governing groundwater trading differ to those for surface-water trading. This is partly because of the relative lack of knowledge about connectivity in groundwater systems and partly because groundwater markets tend to be less developed than surface-water markets. The rules impose conditions considered necessary as a prerequisite for such trades, to avoid undesirable impacts on third parties or on the resource itself. the water trading rules, groundwater trading is prohibited unless certain conditions are met. The conditions differ depending on whether the trade is within the same groundwater sustainable diversion limit (SDL) resource unit, between two different units or between a groundwater SDL resource unit and a surface-water SDL resource unit.
RESPONSE The water trading rules provide that water access rights may be traded within a regulated system, between regulated systems, or within an unregulated system, free of any restrictions (including volumetric limits) on changing the location at which the water may be taken. However, the rules provide that certain types of restrictions may be permitted if they are necessary because of physical constraints, the need to address hydrologic connections, the level of hydraulic connectivity and water supply considerations, or for environmental reasons. Any allowable restriction must still be consistent with the general right to free trade of surface water. The commencement of the water trading rules on 1 July 2014 is consistent with the National Water Initiative which allows Victoria to maintain a 4 per cent limit on the volume of water shares each year traded out of irrigation districts in northern Victoria. An earlier commencement date would otherwise result in Victoria operating inconsistently with the water trading rules. Submissions queried whether the water trading rules permitted trade between regulated and unregulated systems. RESPONSE The water trading rules do not prevent trade between regulated and unregulated systems. The trade of these rights remains at the discretion of state governments. Submissions expressed concern that groundwater trading rules were too prescriptive. RESPONSE The rules governing groundwater trading differ to those for surface-water trading. This is partly because of the relative lack of knowledge about connectivity in groundwater systems and partly because groundwater markets tend to be less developed than surface-water markets. The rules impose conditions considered necessary as a prerequisite for such trades, to avoid undesirable impacts on third parties or on the resource itself. the water trading rules, groundwater trading is prohibited unless certain conditions are met. The conditions differ depending on whether the trade is within the same groundwater sustainable diversion limit (SDL) resource unit, between two different units or between a groundwater SDL resource unit and a surface-water SDL resource unit.
PBP_Consultation_report.docx