Home > Economic policy, Environment > Don’t sell water down river

Don’t sell water down river

May 22nd, 2008

That’s the headline for my article in today’s Fin. It’s a nice pun (sub-editors love this kind of thing) but I should clarify that in fact, I am in favour of upstream irrigators selling water to flow down the river to restore natural flows and provide drinking water for Adelaide.

You can read the full article here on the RSMG blog.

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  1. Peter Wood
    May 22nd, 2008 at 13:20 | #1

    Anything which helps to restore natural flows in the Murray is likely to be a good idea.

    I think that even if we stabilise at 450ppm we are taking a bet on how the uncertainty surrounding climate change is resolved, although nowhere near as big as the 550 ppm bet. Hansen recently estimated a generalised climate sensitivity of 6 degrees centigrade (this takes into account carbon cycle feedbacks and albedo feedbacks, and was estimated using palaeoclimate data). If this is correct then BOTE calculations suggest that 450 ppm is likely to lead to a temperature increase of around 3.5 degrees.

    Temperature increases in arctic polar regions are likely to be significantly higher than the global average. Uncertainties related to Greenland’s ice melting and Siberian permafrost are therefore also important.

  2. MontyA
    May 22nd, 2008 at 14:02 | #2

    You state in your article that the reductions in rainfall over the Murray River basin can be reversed if atmospheric CO2 equivalents do not exceed 450 ppm. This is increasingly an optimistic assesment of the tipping point for dangerous climate change.

    Evidence is coming in that some of the global warming feed back loops are now in play. The arctic summer sea ice is likely to disappear in the next decade, methane levels commenced rising again in 2007 suggesting methane is being released from melting frozen soils and there are increasing signs that melting of the Greenland and Antarctic ice sheets has commenced. An increasing number of climate scientists are stating that we have passed the tipping point for irreversible dangerous climate change unless we can sequester vast amounts of atmospheric carbon in very near future.

    The future is bleak indeed. Governments and big business are worrying about the ongoing problems of the housing bubble bursting and the debt crisis.
    The world economy is looking more and more likely we could rerun 1929, with energy and environmental crises for good measure.

    There ia an interesting, alarming perhaps, graph of (US) Non Borrowed Reserves of Depository Institutions at http://research.stlouisfed.org/fred2/series/BOGNONBR

    Maybe it is time to follow Lovelock’s advice and begin the party.

  3. observa
    May 22nd, 2008 at 14:29 | #3

    With zero water for Murray irrigators now, their dying trees and vines are resolving the lack of past action. The blockers were always going to be outvoted by Adelaide in the end and that’s the way it probably had to be. No polly representing the irrigation seats would have got a guernsey standing for programmed withdrawal, with all the facts and figures in the world behind him. Now there’s nothing any representative can do about it. Total bipartisan impotence. The only thing they can hope for is extra handouts like redundant Mitsubishi workers, but unfortunately there’s no elections in the offing. Bad timing folks. Only Centrelink for you before you make the transition to mining or its coat-tails.

  4. observa
    May 22nd, 2008 at 14:39 | #4

    That’s why I guess I find price much kinder in the long run than well intentioned quantity manipulation and this is a classic example. How much kinder would it have been for blockers facing rising inputs prices for the scarce water, with the more marginal gradually withdrawing to leave the highest bidders to carry on. Look at the bloody mess they’re all in now.

  5. Hermit
    May 23rd, 2008 at 13:33 | #5

    I strongly suspect a gigalitre of upstream water is different to a gigalitre downstream. The salinity, turbidity and algae load must differ between the Queensland border and the approaches to Adelaide. Also whether evaporation and seepage need to be factored in. The early settlers may have found local resources sufficient for their needs and as the settlement grew the cost of far flung imports remained affordable. Now in the era of $135 oil and desalination plants that may no longer be the case.

    That poses the question; can Adelaide now comfortably support its million-plus population? If not should they disperse and where to?

  6. observa
    May 23rd, 2008 at 14:50 | #6

    “That poses the question; can Adelaide now comfortably support its million-plus population?”
    Easily-
    http://www.news.com.au/adelaidenow/story/0,22606,23738227-2682,00.html
    not to mention that the Saudi Arabia of uranium is surrounded by water, although if we can’t buy it relatively cheaply off rice and cotton growers, then we’ll have to think of another way to get all that surrounding water into the form we want. Any helpful suggestions?

  7. Hermit
    May 23rd, 2008 at 17:49 | #7

    A free marketeer would say that SA must exchange uranium for water by outbidding other users. Perhaps with foresight uranium miners like BHP have decided to bypass Adelaide in physical shipments. That may mean the spinoffs go to towns like Pt Augusta. In other words they get the cash flow needed for desalination or pipelines. Aside from royalties Adelaide will have to come up with a new form of buying power.

  8. observa
    May 23rd, 2008 at 18:17 | #8

    Well in a free market you may be right Hermit, but there’s the rub. Introduce C&T and suddenly the nukes/Leigh Creek coal tradeoff will become too tempting. The need for ever more desal would simply ice that cake and I’d expect the Opposition to completely break ranks with Rann on nukes then. All it would take to roll Rann would be more water restrictions in conjunction with rising power prices. Basically Rann has to argue its better to pay that price than adopt nukes like those we sell uranium to. Not exactly a position I’d like to argue from would you?

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