government abstraction reform and water rights henry leveson-gower 19 march 2013
TRANSCRIPT
Government Abstraction Reform and Water ‘Rights’
Henry Leveson-Gower19 March 2013
Contents
- Context: Water White Paper and Bill
– Abstraction Reform
• Why we are reforming
• Emerging reform options
• Implications for ‘rights’
• Research and engagement process
– Questions
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Water White Paper and Bill
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The vision from the Water White Paper
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A resilient water sector, more efficient and customer focused companies, and water valued as the precious resource it is.
• Water resources managed in a way that supports growth and needs of
society
• A reformed water industry
• A reformed water abstraction regulation system
• Balance between supply and demand
• An interconnected water supply system which can move water
around easily
• A catchment-based approach to water management
• Sustainable abstraction levels within all catchments
• An affordable water supply for all
• Water efficient behaviour by businesses and consumers
Why reform is necessary
Current regime not adaptive
Not responsive in protecting the environment
Not flexible in sharing water to get most value
Long-term risks
Climate Change
Demand & increasing
populations
Water scarcity
Risks of excessive costs, environmental damage & system collapse
What do we want to achieve?
• To give clear signals and regulatory certainty on the availability of water, to drive efficient investment to adapt to climate change and meet water needs;
• To better reflect the value of water to customers, its relative scarcity, and the value of ecosystems services to ensure our rivers, lakes and aquifers are protected;
• To reflect the benefit of discharges to river systems;• To drive efficiency in water use, using market forces and smart
regulation to lower costs and reduce burdens;• To be fair to all abstractors, taking into account current licences;• To be flexible and responsive to changes in supply and demand,
including providing greater access to water when more is available; and
• To meet our water needs for people and the environment at least cost to water bill payers, and the consumers of other products and services which depend on water.
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What will the new system deal with?
• Water abstraction in England and Wales• Helping to ensure the environment doesn’t deteriorate• Helping to build resilience to climate change• But:
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Not Current Environmental Damage
Not drought
Reform Options
• We propose 2/3 new options for the future of water abstraction, plus business as usual
• Working names: • 1. Current system• 2. Current system plus• 3. Water shares• [4. Pay as you go]
• Basic design challenge: to minimise impacts of water scarcity while avoiding deterioration of the environment with smarter regulation
Option 1: Current System
Abstractor 3
Abstractor 2
Abstractor 1
Abstractor 4
Environmental Water
Fixed charge per unit of water licensed
When flows are low the environment can lose out
Trading is rare. Transaction costs are high
RSA process used where environment needs more water
Some time limited licences
Abstractor 2
Abstractor 1
Option 2: Current system plus
Environmental Water
Abstractor 3
Abstractor 4 ‘smarter’ HoFs
Shorter term trading easier
Reviews to ensure environment is protected to required level
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Option 3: Water Shares
Available water divided into shares.
Shares available at different levels of reliability
As water availability changes, the size of the pie is adjusted. This defines ‘allocation’
As water availability changes abstractors with less reliable shares receive reduced allocations 21
Option 3: Water Shares
Abstractors can trade allocations
Abstractor 2
Abstractor 1
Environmental Water
Abstractor 3
Abstractor 4
Abstractor 4
In this case to adapt to low flow
Wide range of trading is easy e.g. Up stream
Emerging cross-cutting themes
• Proportionate implementation– Driven by environmental risks and net trading benefits
• Adaptive systems– Potential to evolve if water becomes scarcer
• ‘Unbundling’ to reduce transaction costs– System more flexible and easier to trade
• Discharges integrated into the system– Control based on consumption– Recognises water re-used downstream
• Catchment management and reviews– Triggers and hands off periods
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Key Transition principles
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• Quasi-grandfathering– Taking into account use and licensed volumes– Taking into account current HoFs or lack of
• Not used to address unsustainable abstraction– WFD, Habitat Directive etc will drive environment
protection levels under current system rules
• No compensation for any loses
So what might this mean for water ‘rights’?
• Across the board– ‘Rights’ being more within a collective catchment socio-
economic and environmental stewardship• While grandfathering relative security and quantity
– Introducing a duty to discharge– Abstractors facing future water scarcity risks
• Water Shares– Creating potentially a more secure ‘right’ in the form of
a share, not an absolute right– And allowing much easier trading, particularly to
promote investment in increased collective water security
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How are we assessing the options?
• Research project assessing the impacts that different abstraction reform options might have on people and organisations.
• Catchment case studies to explore how water is managed • within different catchments;• under different climate scenarios • to assess the potential benefits,
costs and risks
• Assessment of overall costs and benefits across England and Wales
What next?
• Digital engagement.
• Consultation and Impact Assessment later this year
• Bill early next Parliament completed ~2017
• Implementation to follow asap
More information www.defra.gov.uk/abstraction-reform/
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