Falls dam, whether it’s maintaining the current one or building a new one, goes to the heart of how we in Central Otago perceive the relationship between our economy and our environment. It also goes to the heart of the vision we have for what Central should look like for future generations.
For most of us that vision includes maintaining our unique landscape and the health of our rivers. It also includes maintaining a robust economy.
So how do we maintain the economy while protecting and enhancing our natural environment which makes Central a special place to live?
The recently published work by our council on the District Vision Project established quite clearly that the people of Central value our natural environment for the benefits it provides, not only to look at but to recreate in. These activities include mountainbiking in our hills and mountains and kayaking in our rivers. It is what Central has become increasingly known for.
So, how do these natural environmental qualities that people value translate into maintaining a robust economy?
The answer is that people are attracted to live in places that offer a quality of life and with them they bring money and jobs.
Look at the growth of Queenstown. People also enjoy visiting places with those same qualities, to join the locals in doing what they do in their backyard. Make it a great place to live and people will come, both to live and to visit.
Secondly, one of the basic principles of resource economics and trade is that countries and regions focus on economic activities that align with their natural environment and resources such as climate, soils, minerals, topography, location etc and trade on these to maximum net benefit.
In Central, those dominant physical characteristics are extreme hot/cold climate, low rainfall, high sunshine hours, some good soils in patches, some gold resources and a large area of modified but largely intact natural landscape which people value for a range of uses.
So, how as a district do we maximise the value of these resources in this environment? There will be inevitable trade-offs between environmental quality and economic returns: however, the rational aim would be to get the best possible return from our environment at the lowest cost to our environment and to our economy.
So back to the water issue. Water is a scarce resource in Central and people value the benefits that healthy rivers and streams provide for drinking, recreation and aesthetic value.
The aim is to get the best possible net benefit from the available water for the whole community.
So, does spending more than $40million on expanding the storage of water in the headwaters of the Manuherikia make economic sense for the wider Central Otago community?
Firstly, I would point out that we are not making the most of our scarce water resources now with the storage we have. In many cases the current land use can’t afford to maintain the infrastructure that supports irrigation now let alone an expanded storage dam.
We also don’t have the legal framework in place that would allow water to be transferred to landowners who can get the most return from that water.
Water rights are allocated on a first-come first-served basis and are tied to the land and consequently, to the land use of the current landowner. Water rights allowing the extraction of vast quantities of water are therefore locked into being used for predominantly pastoral farming of some form or another effectively shutting out latecomers who may have a better use for the water at a lower environmental cost.
The justification used for spending taxpayers and ratepayer funds on increasing water storage for environmental flows in the Manuherikia is a fallacy. The natural mean annual low flow at Alexandra is estimated to be 4cumecs while the initial minimum flow proposed for the river is presently 0.9cumecs.
The threat to the healthy ecological function of the river is firstly, the extraction of water, being mostly for irrigation and secondly, increased discharge of sediment and nutrients that has resulted from the increased intensity of land use that has resulted from irrigation.
For the taxpayer or ratepayer to subsidise addressing the environmental consequences of irrigation by adding more storage is to assist in doubling down on the flawed model that is causing the problem. The flawed model is to establish an irrigation infrastructure that was originally established using taxpayer funds, that has facilitated a land use which cannot afford to maintain the asset it has, let alone expand its storage capacity.
What is being attempted is to facilitate through irrigation a land use that occurs in other parts of the country where it rains a lot.
And then there’s the environmental cost that will inevitably result from increased water storage in the Manuherikia. Most of the under-utilised water rights are held by pastoral farmers. Irrigating land trebles or quadruples its value providing an obvious incentive to expand irrigated area.
There is nothing in the current legal framework that would prevent landowners with surplus water from expanding the area of irrigated land and/or increasing intensity.
Water quality monitoring of the Manuherikia has clearly shown a decline in water quality over the past decade which is related to the increased intensity of land use facilitated by irrigation. Progress is being made on farms to address water quality issues, however some issues, such as nutrification of the aquifer with nitrates, cannot be addressed without a change in land use.
Until these issues are addressed and we have a system in place that makes the best use of the water we have, we should not be supporting expanding storage of water in the Manuherikia main branch.
■ Phil Murray is the chairman of the Central Otago Environmental Society.
