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National Water Account 2016

Sydney: Water rights

Surface water is the primary source of water use in the Sydney region. Groundwater entitlements and rights represent less than 6% of all water rights. Water in the region can be taken based on the conditions associated in the water access licences which specify entitlement (share), allocation and delivery. All entitlements and allocations in the region are managed by the Department of Primary Industries - Water. 

Operating rules and constraints

Operating rules for water right holders

Water access licences issued to major water utilities provide further guidance to the rules established in the Water Sharing Plan for the Kangaroo River Water Source 2003 (NSW Office of Water 2014) and the Water Sharing Plan for the Greater Metropolitan Region Unregulated River Water Sources 2011 (NSW Office of Water 2011a) on how they can fulfill the responsibilities assigned to them (Water management, Table R1). For water right holders (major water utility, local water utility, or individual holder), provisions made in legislation and water management licences define:

  • water entitlements
  • temporal, spatial and volumetric conditions of using the entitlements
  • environmental and any other obligations.


Water restriction rules

Water restrictions for the area managed by Sydney Water are authorised by the Minister administering the Sydney Water Act 1994. Water restrictions in areas outside the Sydney Water management region are determined and managed by the respective urban water utilities. For further information on water restrictions in the Sydney region, see, 'Water restrictions' in Water access and use.


Water entitlements and other statutory water rights

Department of Primary Industries - Water manages the entitlements in the Sydney region in accordance with the Water Management Act 2000. All licences are registered with the Lands Title Office (NSW) and any changes to the water title (water access licence) are processed by that office. DPI Water manages the day-to-day operation of the entitlements, including the maintenance of allocation accounts.

Licences specified under the Water Management Act 2000 are separated into licence categories that provide both:

  • a separated water entitlement that can be traded or sold independently of land
  • the security level associated with the licence.

The Water Management Act 2000 sets the priorities for water sharing and defines them depending on water access licence/entitlement categories. The environment has first priority, followed by basic rights (domestic and stock rights, harvestable rights and native title rights) and then all other licensed rights.


Water access entitlements

As defined on the DPI Water website, water access licences specify entitlement (shared), allocation and  delivery (extraction). 

The share component of the access licence is similar to the entitlement volume that was previously applied under the Water Act 1912 (NSW) and is expressed as a unit share or, in the case of specific purpose licences (such as a local water utility and domestic and stock use), as a volume in megalitres. The amount of water individual licence holders are allocated as a result of an available water determination and the amount of annual extraction is based on their respective share components. Other rules, such as carryover, are also based on the share component.

An announcement regarding the water availability determination is made with regards to a water source and access licence category and applies to all access licences in the water source within that licence category. The key elements of an announcement are:

  • water source
  • licence category
  • announcement type
  • date or period to which the announcement applies
  • the volume announced per share.

Shares in available water may be assigned generally or to specified categories of water access licences. The specified categories of water access entitlements defined in the Water Management Act 2000 are available on the DPI Water website.


Surface water rights and entitlements

Surface water rights and entitlements are divided into several categories based on their priorities and security. Licence categories in the Sydney region include major utility, local water utility, domestic and stock, and unregulated river access licences. 

Three basic landholder rights are also applicable to the Sydney region as outlined below.

1. Domestic and stock rights

Under the Water Management Act 2000, an owner or occupier of land which is overlaying an aquifer or has river, estuary, or lake frontage can take water without a licence under domestic and stock rights for the following purposes:

  • for domestic consumption (e.g. drinking, cooking, washing, watering household gardens and filling swimming pools associated with domestic premises on the property)
  • to water stock on the property.

This water cannot be used for irrigating crops that will be sold, bartered, or used for stock fodder, for washing down machinery sheds, or for intensive livestock operations.

2. Native title rights

Native title rights or cultural basic rights allows abstraction of water for anyone who holds a native title with respect to water as determined under the Australian Government Native Title Act 1993. The rights holders can take and use water for a range of needs without holding a water access licence.  This includes accessing water for personal, domestic and non-commercial communal purposes such as:

  • manufacturing traditional artefacts
  • hunting, fishing and gathering
  • recreation
  • cultural
  • ceremonial.

3. Harvestable rights

Harvestable rights allow landholders in most rural areas to collect a proportion of the runoff on their property and store it in one or more farm dams up to a certain size. This does not involve abstraction directly from the river so it is not generally provided for in water sharing plans.


Groundwater rights and entitlements

Groundwater entitlements and rights represent less than 6% of all water rights in the Sydney region.

Anyone who holds a groundwater basic right can extract water to meet basic requirements for household purposes (non-commercial uses in and around the house and garden) and for watering of stock. This water cannot be used for irrigating crops or garden produce that will be sold or bartered, washing down machinery sheds, or for intensive livestock operations. During the 2015–16 year, groundwater bores used for this purpose were licensed with DPI Water.

Entitlements held by urban utilities are available from three groundwater management units: Goulburn Fractured Rock, Sydney Basin–Nepean Sandstone and Sydney Basin–Richmond Sandstone. There are no other groundwater entitlements conferred to management authorities to supplement centralised water supply to the Sydney metropolitan area.

More information on groundwater rights is available under Water access and use and more details can be found in the Water Sharing Plan for the Greater Metropolitan Region Groundwater Sources 2011 (NSW Office of Water 2011b).


Fish River Water Supply Scheme

The volume of water supplied from the Fish River Water Supply Scheme is based on water supply agreements between WaterNSW and its customers. The total allocated volume for WaterNSW, Lithgow City Council and Energy Australia which have water entitlements from the scheme is 13,612 ML.

Each organisation's allocation is available for extraction in a given year if there are no restrictions. When the storage volume of Oberon Reservoir falls below 50% (22,381 ML), the water allocation for major consumers is determined based on a restriction table. Restrictions vary with the storage level. Entitlement holders are allowed to carry over their unused allocation up to a maximum of 20% of the maximum annual quantity.


Hydro-electric power generation

As noted in the Water Sharing Plan for the Greater Metropolitan Region Unregulated River Water Sources 2011, Eraring Energy holds an annual entilement of 4,021 ML under the category of 'major utility access licence'. This right is used to service interchanges between Lake Yarrunga and Fitzroy Falls reservoir and between Bendeela Pondage and Lake Yarrunga at any time for hydro-power generation. Eraring Energy is permitted to increase the interchanging volume between Lake Yarrunga and Fitzroy Falls Reservoir under the following circumstances:

  • during periods of unusually high power demand
  • in the event of failure of other generating stations in the State energy network or major power failure
  • at times when Fitzroy Falls Reservoir is spilling to Yarrunga Creek, subject to any environmental flow requirements in Yarrunga Creek.

Further details of Water rights applicable to the Sydney region can be found under Water access and use.


Water allocations

The water year for water allocations and use in the Sydney region is 1 July–30 June. There is a formal available water determination process at the commencement of the water year that is managed by DPI Water. The amount of water available for extraction and the rules pertaining to that water are outlined in the relevant water sharing plans for both groundwater and unregulated river water sources. In particular, carryover rules and other rules associated with that extraction are noted under the section 'Limits to the availability of water' of the relevant water sharing plan.

Entitlement holders are able to draw their maximum entitlement volume unless, due to a limited supply of water, authorities announce an 'as needs' basis.

There is no allocation determination for basic rights as such; however, in times of limited supply, there may be restrictions on taking water for domestic and stock uses under riparian rights and groundwater basic rights.


Trades and water rights transfers

Water market rules: interstate trading

Interstate transfer of an access licence and assignment of water allocation to or from the water sources is prohibited as noted in Clause 69 of the Water Sharing Plan for the Greater Metropolitan Region Unregulated River Water Sources 2011 and Clause 51 of the Water Sharing Plan for the Greater Metropolitan Region Groundwater Sources 2011.


Water market rules: inter-valley and within-valley trading

Water trading rules for the region are defined in the applicable water sharing plan in accordance with the Water Management Act 2000; however, the required mechanisms for inter-valley trading do not currently exist. Trade between water sources is not permitted. As a result, no water trading occured during the 2014–15 year in the Sydney region.


Restrictions on trade

As the mechanisms for the trading of water are not yet in place there was no trading in the Sydney region.