MID Modernisation

1.Project and Benefits  

Benefits  

Q. What are the benefits of the modernisation project?  

A. The Phase 2 project completes the MID 2030 strategy which aims to transform the district into a modern irrigation system. It includes pipelines in Newry and Nuntin areas that are the main parts of the district yet to be upgraded.  

Newry’s channels are over 100 years old and have deteriorated to the point where 40% of water is lost between Lake Glenmaggie and the customer outlets. The area is not suited to open channels because the underlying soils are porous. The advantage of a pipeline is reduced water consumption and better delivery with reduced watering time leading to improved pasture growth. The modernisation will result in significant economic benefit to farmers and the region as well as lifestyle improvements.  

The environmental benefits include 1.7 GL from the water savings to be used for environmental watering of local waterways. Additionally, the project will reduce the adverse impacts of land salinisation from high watertables and nutrient runoff to natural waterways and the Gippsland Lakes.   

Project Timelines  
 
Q. What is the timing of the project?   

A. Phase 1A was completed in August 2017, and Phase 1B was completed in September 2020.  

The Phase 2 projects began in September 2020 and will be completed over a four-year period to 2024. The overall project was broken into phases to focus on work that brings the greatest value in water savings and service improvements. 
 
The $160m MID program of upgrades is being delivered on time, on budget through a successful partnership with farmers, the State and Federal Governments, and stakeholders such as Agriculture Victoria (AgVic) and West Gippsland Catchment Management Authority (WGCMA), to achieve the project’s objectives.  

Project Funding  

Q. How is the project being funded?   

A. Including the phase 2 project approximately $160m has been invested in infrastructure for the MID2030 modernisation program. By its completion SRW customers will have contributed over $60m in partnership with the State and Federal Governments contributing the balance. The $62.6 million Phase 2 project is jointly funded by the Australian Government providing $31.3 million, the Victorian Government $10.4 million and Southern Rural Water $20.9 million.  

There is also a unique partnership between WGCMA, AgVic, SRW and customers to plan for on-farm improvements that will boost production and reduce their environmental impacts. The agencies are supporting farmers to complete Irrigation Farm Plans in synergy with the modernisation. The plans will guide State and customer investment towards on-farm works.    

The Australian Government is investing $3.5 billion towards a 10-year rolling program of water infrastructure projects that, in partnership with states and territories, will help supply billions of litres of water for productive use each year and deliver the National Water Grid.  

This investment will grow Australian agriculture, increase water security, build resilience to drought and support regional prosperity.  

Areas of Cultural Significance  

Q. Traditional Owner Engagement    

A. The SRW project planning and delivery teams have been working closely with the Gunaikurnai Land and Waters Aboriginal Corporation (GLaWAC) on the Cultural Heritage Management Plan for the program of works. So far, preliminary investigations have found a significant number of artefacts around Newry and Nuntin. We are working with the WGCMA and GLaWAC to acknowledge the significance of the find and roll out complementary community education.  

2.Community Issues and Engagement  

Pricing and cost   

Q. Pricing and Water distribution (how will customer contribution be met?)  

A. So far customers have contributed about $40M through annual fees and the sale of water savings. The phase 2 project estimate of $62.6M requires a further $20.9M contribution from the MID customers. This could be raised through an increase to the annual fees, the sale of water savings, or a combination of both, noting that the State’s preference is that the water savings are sold by a market process. The preferred option will be determined in consultation with SRW’s customers, during the next pricing submission and referred to the Minister for Water who is responsible for approving how savings are distributed. Our approach to consultation is currently in development and the timeline will be shared when it becomes available.  

Customer agreements   

Q. What is the process for negotiating customer agreements?   

A. SRW is progressively meeting with customers to explain the Modernisation Works Agreement (MWA) which details the works SRW will undertake to reconnect the existing property and its watering system to the new pipeline.   

Once this presentation is made, the customer is then provided the opportunity to undertake some, or all, of the on-farm reconnection and decommissioning works. When the scope of the works the customer wants to undertake is established, SRW calculates the avoided costs (of not doing this work) and makes an offer to the customer. This is known as a co-contribution offer.   

If the customer accepts this offer, a Deed of Variation to the MWA is drafted for the customer to sign. Funds are then progressively paid to the customer based on works proceeding. There is no obligation on any customer to negotiate a co-contribution agreement.  

Groundwater and surface water licence holders   

Q. Will replacing leaky channels with a pipeline affect access to water from the Newry Creek and bores for licensed use?  

A. Tinamba customers have reported significant improvements to water efficiency once they have set up their irrigation system to take advantage of the automation and pressure in the pipeline. Newry customers have expressed some concern about possible impacts on their licences from the changes. The project involves the decommissioning of the Newry river-channel and replacement with the new pipeline which eliminates channel leakage and outfalls from the end of the channel.  SRW has engaged an expert to independently review the potential changes to water availability and consequences once the channel is abandoned.   

Preliminary findings indicate that groundwater levels and annual flows to Newry Creek are maintained primarily through rainfall, with flooding, seepage and outfalls contributing substantially less. A change to surface and groundwater availability has occurred since the late 1990s, with a reduction in overall annual rainfall volume. There is significant uncertainty and complexity in trying to predict the changes to the water balance but the outcomes will indicate the relative scale of change and guide a risk analysis.  

The report is expected to be ready by mid-August.  

Q. How can customers supplement their existing entitlements to meet their irrigation needs?  

A. The new pipeline is designed to supply all the irrigable land in its area assuming an increased demand for climate change. It has significantly greater capacity than the existing channel. This will enable customers who currently irrigate from groundwater or surface water to have their demand met from the new pipeline should more water be required. Section 51 licences from streams and bores cannot be transferred to the new pipeline. While customers are transitioning to the new delivery system there will be time to assess your needs. Opportunities to obtain temporary and permanent entitlements from the pipeline will be available at the market rate if more water is needed.  

Private bore owners   

Q. What are the rights of private bore owners and is it likely the modernisation project will affect their performance?  

A. Everyone has a private right to water on their property typically for gardens and stock watering. In rural areas outside of a reticulated water supply, it is common to use rainwater and bore water for human consumption. The Department of Health & Human Services provides advice on making private drinking water safe (see Private drinking water - health.vic). All bores must be installed by a licensed driller. There is no guarantee to their yield and quality, and bore owners are responsible for bore and pump maintenance.   

More specific and individual bore assessments will need to be gathered from community and residents to understand any sustained impacts. For example: how old the bores are, pump age and condition of each bore.    

Environmental impacts   

Q. Will environmental flows be provided to Newry Creek?  

A.  The Victorian Environmental Water Holder (VEWH) works with catchment management authorities to ensure environmental water entitlements are used to achieve the best environmental outcomes with the water that is available. It is an independent statutory body responsible for holding and managing Victoria's environmental water entitlements including 1.7GL of water savings reserved by the State from the phase 2 project for environmental flows. The WGCMA has a formal environmental water advisory group (EWAG) for the Macalister River, consisting of community and agency representatives. The WGCMA has offered to explore environmental flow opportunities if requested to by the community. There will be no lost opportunity with the installation of the pipeline now on the future allocation of an environmental flow.  

SRW has conducted an environmental and heritage study which indicated there are no threatened species in the project area that will be significantly impacted by the pipeline project. We will work with the WGCMA to assess if mitigation water for environmental purposes needs to be provided to the waterways affected by the loss of outfall water. SRW will avoid disturbing valuable flora and fauna when it sets the final pipeline alignment and during construction.  

The WGCMA and Maffra Landcare are happy to work with the community to identify opportunities to enhance the environmental values of Newry Creek and wetlands through strategies such as weed management and revegetation.