Integrating and valuing alternative water in Adelaide, South Australia.
Water Sensitive Cities Conference: Valuing a water sensitive city – Economics Session
Craig Flavel (Water Technology), Andrew Telfer (Water Technology), Alison Charles (Water Technology), Michael Di Matteo (Water Technology), Sam Phillips (SA Dept for Environment and Water), Andy Chambers (Seed Consulting), Michele Akeroyd (Inside Infrastructure), Kanchana Karunaratna (Marsden Jacobs).
Adelaide’s use of groundwater, treated effluent and treated stormwater from schemes using managed aquifer recharge (MAR) not only provides water at a price that stimulates the economy but also provides benefits such as increased water resilience and reduced coastal pollution.
By providing evidence of the true value of alternative water, this work can be used by a broad stakeholder group to inform business cases for the integration of alternative water schemes and encourage the use of alternative water resources to build sustainable cities and thriving communities.
Adelaide is the capital city of the driest state in the driest inhabited continent on Earth. The estimated market value of potable and alternative water on licence in the state of South Australia is over $2.8 billion. Alternative water in the study (Figure 1) now provides approximately 40% of Adelaide’s reticulated water use (Figure 2). Use of groundwater, treated effluent and treated stormwater from schemes using managed aquifer recharge (MAR) not only provides water at a price that stimulates the economy but also provides benefits such as increased water resilience and reduced coastal pollution. Due to variability in the value placed on these benefits by market stakeholders (Table 1), MAR is complex and strongly influenced by market externalities. These market stakeholders are diverse, including primary producers, sporting clubs, residents and councils. The regulation of the market is accordingly diverse; directly involving nine state government departments.
Within this context, the Adelaide and Mount Lofty Ranges NRM Board commissioned a study that derived estimates of the supply, demand, usage and quality of alternative water. The study methodology leveraged previous work, studying the land use in three zones in the study area and consulting with a wide range of stakeholders. Complex challenges of valuing water, water quality variability and a lack of monitoring data were addressed during the study by the project team. The project team mapped urban open spaces near alternative water pipelines, gathered operational data and identified trends and alternative water opportunities.
In the study area, alternative water usage was ~60,000 ML/a with 7% comprising MAR. Stormwater MAR supply was driven by a combination of market drivers and grant funding. The variable timing and distribution of grant funding can create uncertainty in the alternative water market. The impact of the different drivers of supply is evident in the pricing disparity between treated effluent and stormwater MAR. Excess demand for all alternative water was ~38,000 ML/a and excess supply (without upgrades) was ~54,000 ML/a. Peak demand did not coincide with peak supply, however, additional storage using MAR could reduce the excess supply.
Groundwater and treated effluent supply 93% of alternative water usage in the study area. Both of these sources are cheaper than stormwater MAR but for different reasons. Groundwater prices are driven by market forces under Water Allocation Plans. Treated effluent prices are subsidised by sewerage charges and driven by environmental protection legislation. Critical to integration of the market is coordination of diverse stakeholders. A coordinating body could set a framework that considers the true value of using alternative water, in addition to opportunities such as blending of water sources, decentralising MAR wells, water trading and expansion of treated effluent supply schemes to maximise the effectiveness of alternative water usage.
Increasing demand in future will likely be from conversion of perennial horticulture to high value seasonal horticulture, accessing excess demand from primary production outside the study area and meeting residential demand. Identifying these sectors is important as it drives where future investment may be cost effective.
By constructing 58 MAR schemes and 1,050 km of alternative water pipework for MAR and treated effluent in the study area, the region has demonstrated capacity to create and meet demand using alternative water. By providing evidence on the true value of alternative water, this work can be used by a broad stakeholder group to inform business cases for the integration of alternative water schemes and encourage use of alternative water resources.