The Otago Regional Council recently completed a technical study on the groundwater in the lower Taieri basin.
Results of the study would be used to help the council develop policy and be taken into consideration alongside social and economic factors when setting water allocation levels.
Council resource scientist Jens Rekker said in a report there were relatively low levels of groundwater pumping in the basin compared with the potential for groundwater use.
The majority of consented groundwater takes were for Mosgiel's town supply and a minor amount for associated industry.
A handful of small agriculture irrigation takes from bores made up the rest of the allocated groundwater, bringing the combined basin groundwater allocation total to 2.4 million cubic metres a year, he said.
There was also a large number of domestic and stock water supply bores throughout the basin.
The study divided the basin into west and east zones to assess the potential impacts of groundwater pumping, identifying allocation volume limits for the basin, Mr Rekker said.
"The east Taieri zone has a greater potential impact... on the flow of the Silver Stream which justifies a more stringent allocation limit being placed on it."
Limiting increased allocation would lessen the likelihood of substantial effects on the Silver Stream during low flows, while opening the groundwater allocation for modest expansion.
The west Taieri zone was comparatively undeveloped but further abstraction could be allowed without causing adverse effects.
"There is potential for beneficial effects of such abstraction on reducing the requirement for drainage system pumping."
The suggested changes to limits were a "fine tuning" of existing restriction levels and would not impinge on domestic water takes, Mr Rekker said at a recent committee meeting.
"It's tinkering, rather than a substantial change."
The council's environmental science committee recommended the report be referred to the policy and resource planning committee.
