Plantations and Water Roundtable Discussion Paper
Canberra, 20 April 2005
Hotel Heritage
Canberra
The National Water Initiative (NWI), as agreed by COAG (except Tasmania and Western Australia), and the requirement on State Governments to develop implementation plans to achieve the objectives of that agreement, present a significant number of challenges for Australia’s plantation sector. Paragraph 55 of the Intergovernmental Agreement for the NWI identifies large-scale plantation forestry as a landuse change activity occurring without a water access entitlement, but with the potential to intercept a significant volume of surface and/or ground water. The agreement goes on to state that the impacts of plantation forestry should be assessed and, where necessary, appropriate planning, management and/or regulatory measures should be introduced by catchment managers to protect the integrity of the current and future budgeted water access entitlements (paragraph 56).
While there appears to be no justifiable reason for having plantations or native forests recognised as a significant interceptor of water, the NWI is quite clear in its content. A change in landuse to large-scale plantation forestry will be regulated by catchment managers through a process that is similar to the management of water interception by farm dams.
There is no doubt that plantations, like all other dryland activities, use water. However, the impact of plantations on catchment water yields is extremely variable and there continues to be little recognition of the many economic, social and environmental benefits that can be generated by supporting the future growth of the plantation sector. In lower rainfall areas, for example, it is more than likely that plantations will deliver a more efficient use of the available water than other agricultural activities.
The National Water Commission will therefore have an important role in determining whether the treatment of plantation forestry, to be presented in the State’s implementation plans, is consistent with the objectives of the NWI. Governments should not attempt to over-regulate the plantation sector by detailing the species that can be grown or the silvicultural practices, and when introducing rules which refer to plantation planning approvals, that there is some means for assessing the economic and social impacts of those regulatory controls.
The Plantations and Water Roundtable will consider definitions for some of the terms contained in the NWI, the options for using a balanced approach to assist catchment managers determine how water should be distributed across each landuse, and the options for securing credits arising from more efficient water use or improvements in water quality. It is anticipated that these important matters can be drawn together in an industry position statement on plantations and water, and will be pursued by an industry working group after the Roundtable. The following draft statement is provided for discussion during the course of the Roundtable.
The plantation sector is willing to assist water regulators and catchment managers:
- to develop the means for assessing and weighing up the economic, social and environmental impacts and benefits of each landuse before establishing any new system of water entitlements within their jurisdictions;
- to help them understand the related policy implications and potential environmental benefits from plantations before regulating the water entitlements for this landuse;
- to recognise that the industry is already committed to improvements in water use efficiency from certification and the legislated codes of forest practice; and
- by identifying the initial research questions that need to be addressed as priority issues to help meet the expectations and objectives of the NWI during its implementation.
Background on the National Water Initiative (NWI) and National Water Commission
The NWI as agreed on 25th June 2004, established the objectives, outcomes and actions to be completed as part of the national water reform process. This agreement identified the need for reform in water access entitlements and planning, integrated catchment management, water resource accounting, building improved knowledge, and establishing a system of community partnerships and adjustment. It is intended that this process of reform will optimise the economic, social and environmental outcomes from the nation’s water use, based around a transparent and legislated system for water planning in each State and Territory, and facilitate efficiency improvements in the use of water.
As part of the NWI, large-scale plantation forestry was recognised as a significant interceptor of water with the water use entitlements for this landuse to be considered separately from the entitlements for all other dryland landuses. The State Government processes for regulating plantation forestry should therefore be contained in the draft implementation plans that the States will present to the National Water Commission by mid-2005. In the first instance, the Commission will be required to undertake an initial assessment of Australia’s water resources and water management practices.
Two additional roles for the Commission will be advising COAG on progress with the implementation of the NWI and the administration of the Australian Water Fund. There will be two programs under the Australian Water Fund – Water Smart Australia and Raising National Water Standards. Water Smart Australia will accelerate that introduction of new water use technologies and practices. The Raising the National Water Standards program is designed to improve Australia’s capacity to measure, monitor and manage its water resources.
Plantations and Water - an overview
The opinions surrounding the level of water use by plantations has been over-simplified to a point where there is a commonly-held perception that plantations use 1-2ML per hectare per annum more water than the pastures they replace. This additional interception of water may lead to a reduction in stream flow, leaving a smaller amount of water available for other water users and the environment.
At the present time, each State’s Code of Forest Practice provides an important link between forestry and water policies. In each Code of Practice, the planting of trees around drainage lines, creeks and rivers, is heavily restricted. For example, in Victoria, the Code of Practice contains a ‘water yield protection requirement’ that may require plantation managers to protect water yields by adopting longer rotations, controlling stand density by thinning, or by placing limits on the area that can be harvested each year. Unfortunately, the new management and design requirements contained within the Codes of Practice are not fully reflected in the current models of plantation water use, which use data from older plantation designs that are likely to over-estimate the amount of water being intercepted.
It is important that catchment managers are aware that plantation water use is driven by a number of factors that extend well beyond the area or proportion of a catchment that contains plantations. Research from the CRC for Catchment Hydrology has indicated that there are significant differences in plantation water use between the uplands and lowlands of catchments. In some cases, as in the Commercial-Environmental Forestry project being undertaken for the Goulburn-Broken catchment (Victoria), it is predicted that plantation establishment can be targeted in the landscape to deliver a significant reduction in the volume of saline groundwater discharged into rivers while having a limited impact on surface water run-off.
For other catchments, such as the Denmark River catchment in southwest Western Australia, a change in landuse from agriculture to plantations is leading to improvements in the river’s salt loads. Although it will take some time for the water quality to return to potable levels in that catchment, there is a long-term positive trend associated with the expansion of the plantation resource.
While there is little doubt that plantation use water, the correct assessment of how much water is intercepted, whether it is significant and whether that use of water has other positive benefits, has only been assessed in a small number of cases. If in the major plantation regions around Australia, tree crops cover less than 10% of the agricultural land area, but produce up to 30% of its economic output and provide more than 25% of its employment, should this be viewed as a good use of water? If so, should this water use be supported through legislation and catchment management plans that reflect such benefits?
How should the water entitlements for each landuse, including plantations, be determined?
Improvements in water quality must be considered alongside the impacts on water yields, government policy priorities and other regional economic and social outcomes, when assessing the water use and entitlements for plantation growers. For example, the Victoria’s draft Plantation Investment Strategy recognises the importance of having a viable and growing timber industry in that State. However, with the reduced access to native forest resources in that State, the industry will become increasingly dependent on plantation resources, which may in turn, impact on water yields and run-off. It is therefore important for State Governments and catchment managers to recognise and resolve the conflicts between water use and other policy priority areas.
Reviews of the current literature on plantation water use indicate that the impacts of plantations on stream flow are specific to their respective region and ecosystem. For example, in some areas plantations use less water than native forests (Leon Bren, personal communication) while in others, plantations use groundwater from shallow water tables (Richard Benyon and Tanya Doody, CSIRO Technical Report No. 148, 2004). Given the specificity of these research results, decisions on water allocations for particular landuses, such as plantation forestry, should be made at the Water Management Planning level based on the principles of a nationally-consistent framework, rather than through prescriptive State Government legislation and regulations.
However, at this time, no government or catchment has developed a system that will help guide the decisions of catchment managers over their water allocations, entitlements and management options for all of the landuses within their jurisdictions. A comprehensive approach for assessing the water needs and setting entitlements is outlined in Figure 1 (on p.6). By taking account of all these factors, it may then be possible to determine what are efficient uses of water, what is significant interception and what is large-scale plantation forestry.
During the Plantations and Water Roundtable, there will be some consideration of the processes that catchment managers could utilise to assess the amount of water being used and to determine the sustainable water entitlements across the various landuses within their jurisdictions. The processes adopted by catchment managers should have the capacity to take into account the:
Certification is another means for improving the efficiency of plantation water use
If the plantation sector can be guaranteed access to a certain volume of water within each catchment, then issues over water use efficiency, species selection and silvicultural options become of strategic importance to the future growth of the industry. Forest managers who have achieved certification are already required to consider these matters as part of their commitment to on-going improvements within their sustainable forest management practices.
For example, under the Australian Forestry Standard, one of the indicators is for forest managers to work with relevant landholders and water managers to monitor the impacts of forest management activities on water yields. Appropriate actions for forest managers may include increasing water yields by thinning or by maintaining a mosaic of age classes across catchments. However, some thought may need to be given to the impacts on water yields where a substantial proportion of any one catchment is planted with tree crops across one or two years.
The requirements of certification, in addition to the requirements stipulated in the State’s codes of forest practice, have the potential to drive improvements in water use efficiency. Other options for improving water yields may be to leave the plantation sites fallow for a year (and sell the increase in surface water run-off for that period) or to include late-age fertilisation as a means of increasing the volume of timber grown for each megalitre of water consumed by plantations.
Unless water managers and regulators are properly informed about current water use, projected use and the options for improving the efficiency of water use across all landuses, it will be difficult to derive an equitable and consistent system for allocating water entitlements. In this context, the research priorities of the plantation sector which need to be completed to assist this process, will be discussed during the Plantations and Water Roundtable.
Water regulation driven by various sources of legislation
Clauses 55 and 56 of the NWI clearly identify water interception by plantations as an important issue that needs to be addressed. In addition to the water resources legislation in each State and Territory, it is possible for plantation water entitlements to be regulated through a range of other mechanisms which have been designed to minimise any threats to ground and surface water yields, including:
- the preparation of regional water resources planning frameworks
- the development of water and streamflow management plans
- the declaration of water supply protected areas
- integrated catchment management strategies
- river health strategies
- regional landcare plans
- nutrient management plans
- native vegetation management and protection plans
- salinity management plans
- biodiversity management plans
- environment protection policies and legislation
- State and local government planning policies and guidelines, and
- forestry legislation and codes of practice.
This list indicates that there are many different ways to control the impacts of plantations on surface water run-off and catchment water yields. In addition, there is already some talk of introducing new measures that could, if not thoughtfully implemented, have a significant and unnecessary impact on the future growth of the plantation sector. These new measures might include mandatory water efficiency or water-saving targets, set on a catchment-by-catchment basis. However, they should not be introduced until they can be applied to all landuse activities within the respective catchments.
Will the improved management of water resources lead to new opportunities for the plantation sector?
To improve the returns from plantation forestry projects, one option is for catchment managers to consider the development of salinity credits. These credits could apply to some of the multi-purpose plantations that will be established in areas such as the Denmark River and Goulburn-Broken catchments. In addition to the salinity credits, catchment managers might also consider supporting some positive economic returns for the introduction of practices that lead to a more efficient use of water.
In the Pratt Water Murrumubidgee Project, The Business of Saving Water, it is stated that ‘our water crisis does not stem from an overall shortage of water. Our water crisis arises from our failure to make better use of the water resources we have.’ Instead of the water debate focussing on a choice between agricultural growth and the environment, there is a requirement to have a national water policy and trading system to ensure that water flows to its highest-value uses, which should also incorporate the unique and lengthy growth periods of the forestry sector.
The Pratt Water Project provides some examples of the water savings that could be delivered from a better use of our existing water resources. Out of the 4.3 million ML of water conveyed through the Murrumbidgee catchment each year, around one-third of the water is lost from the system without generating any economic, social or environmental benefit. It has been estimated that up to 945,000 ML of these water losses could be saved and used for productive purposes and environmental flows.
If these water savings can be delivered, it will open up the potential for a range of new agricultural investments in this particular catchment, including the establishment of additional plantations. The report indicates that at least 30,000 hectares of new plantations are required to meet the growing demands of the region’s timber processing sector and should be established over the next 10-15 years. Even if these plantations were to use 1ML of water each year over and above the amount of water used by the pasture they replace, this would only represent around 3% of the possible water savings for the catchment.
There also continues to be some discussion on the introduction of water saving targets for catchments and the introduction of a trading system for ‘saved water certificates’, which could be recognised as a new and tradeable category of water. For plantation growers, it may be possible to be part of this system if water-saving certificates can be generated through changes in silviculture or by leaving the plantation areas fallow for an extra year between harvesting and replanting. In this latter case, plantation growers could receive water-saving certificates for the increase in water run-off that occurs during the fallow period.
Industry working group on plantations and water
It is anticipated that the Roundtable will identify priority actions to be pursued in working with the National Water Commission and water regulators. These actions will include defining a number of key terms contained in the NWI, outlining a process for determining water entitlements across all landuses on the basis of the economic, social and environmental outcomes they produce, outlining the options for salinity or water-saving credits, and identifying the research priorities for plantation managers.
Nominations will be sought from people attending the Plantations and Water Roundtable for the establishment of an industry working group on plantations and water. Terms of reference for guiding the activities of this working group on plantations and water issues will be based on the outcomes of the Roundtable.
Figure 1. Recommended National Water Initiative Framework, reflecting the principles agreed by COAG for delivery through Water Management Plans.
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