Not all water entitlements in the Southern Connected System have access to carryover, and there is variation in the types of carryover offered in each state.
Carryover in Victoria
In Victoria, carryover is available for high and low reliability water entitlement shares. Any carryover plus new allocation greater than the volume of the entitlement is set aside in “spillable” accounts, and only becomes available when the Victorian Resource Manage declares a low risk (<10 per cent chance) of spill from Hume Reservoir. If Victorian water in Hume does spill, some or all of the allocation in the spillable accounts may be lost as occurred in October 2016.
Victoria’s carryover arrangements
Carryover in New South Wales
NSW Murray and Lower Darling general security entitlement holders may carryover up to 50 per cent of their entitlement volume, but if the sum of their carryover allocation plus annual allocation is greater than 110 per cent of their entitlement volume, any additional annual allocation is forfeited; as occurred early in the 2016-17 water use year. Other licenses including those in relation to high security, stock and domestic, conveyance, water utility and supplementary water do not have access to carryover.
NSW Murray and Lower Darling Water Sharing Plan
NSW Murrumbidgee general security entitlement holders may carryover up to 30 per cent of their entitlement volume, but if the sum of their carryover allocation plus annual allocation is greater than 100 per cent of their entitlement volume, the additional allocation is forfeited. Other licences including those in relation to high security, stock and domestic, conveyance, water utility and supplementary water do not have access to carryover.
In a year when carryover is not available, how can I access more water allocation if I need it?
If additional water allocation is required by a water user in any year, then there are a number of ways to secure it. These include:
- Purchase of water allocation on the ‘spot’ water market on an as-needed basis
- Purchase of water allocation on the ‘forward’ market, whereby a buyer may enter a contract with a seller to buy water allocation for a set price, with delivery at an agreed date in the future (this may also be beneficial as it can mitigate against future pricing uncertainties)
- Purchase an interstate water entitlement with carryover characteristics that better match your requirements
- Enter a contract to temporarily ‘park’ your spare water allocation in the carryover capacity of an eligible entitlement of an interstate water holder.
Note that options 2-4 are only implemented through water brokers, who would be happy to talk through the options with you.
What is ‘carryover parking’?
Some water brokers offer the opportunity for water holders to transfer or ‘park’ excess water allocations that they do not wish to sell and cannot carryover (either because carryover is not available, or their proposed carryover volume is already at capacity), with another water holder that has spare carryover capacity.
The water holder parking carryover enters a contract and pays a ‘carryover parking fee’ to the holder of the spare carryover capacity. The parked allocation may be subject to spill, depending on where it is parked, and is otherwise transferred back to the original holder of the allocation at the beginning of the following water year.
Note: Carryover parking is an offering by some water brokers to their clients. The department has no involvement in these arrangements and will only determine entitlement transfer applications when they are lodged with the appropriate fee.