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"Water management and allocation into the future - a strategy for Otago" aims to help the region take advantage of its water resources through both "tried and true, and innovative uses".
It was adopted by the councilat its final meeting of the year.
Cr Stephen Woodhead said the strategy pulled together many ideas and concepts that had been talked about during the past three to four years.
"This gives us the direction and focus to move forward."
The strategy said most surface water in Otago, with the exception of the Clutha, was seriously over-allocated and demand for water continued to increase.
The successful transition from the mining privilege system was an important issue it addressed.
"Requiring holistic, catchment wide approach to sourcing water, and encouraging water use management that is based on greater co-operation between users will benefit this process," the document said.
The strategy proposed changes that it said would enable more sustainable, integrated and efficient use of Otago's resources.
Included were water users increasingly working together, effective management during times of shortages, increased efficiency of water use, particularly where it is scarce and a water allocation system that achieved sustainable and efficient water use management.