Document ID: chunk:federal_register_of_legislation:C2024C00557:clause:3_4:p1
Version: federal_register_of_legislation:C2024C00557
Segment Type: clause
Provision Reference: sch 3 cl 4 (pt 1/2)
Character Range: 1056597–1059596

4  Basin water market and trading principles
 (1) This clause sets out the Basin water market and trading principles.
 (2) Water access entitlements may be traded either permanently, through lease arrangements, or through other trading options that may evolve over time, if water resources are physically shared or hydrologic connections and water supply considerations would permit water trading.
 (3) All trades should be recorded on a water register. Registers will be compatible, publicly accessible and reliable, recording information on a whole of catchment basis, consistent with the National Water Initiative.
 (4) Restrictions on extraction, diversion or use of water resulting from trade can only be used to manage:
 (a) environmental impacts, including impacts on ecosystems that depend on underground water; or
 (b) hydrological, water quality and hydro‑geological impacts; or
 (c) delivery constraints; or
 (d) impacts on geographical features (such as river and aquifer integrity); or
 (e) features of major indigenous, cultural heritage or spiritual significance.
 (5) A trade may be refused on the basis that it is inconsistent with the relevant water resource plan.
 (6) Trades must not result in the long‑term annual diversion limit being exceeded. That is, trades must not:
 (a) cause an increase in commitments to take water from water resources or parts of water resources; or
 (b) increase seasonal reversals in flow regimes;
above sustainable levels identified in relevant water resource plans such that environmental water or water dependent ecosystems are adversely affected.
 (7) Trades within overallocated water resources (including ground water resources) may be permitted in some cases subject to conditions to manage long‑term impacts on the environment and other users.
 (8) Where necessary, water authorities will facilitate trade by specifying trading zones and providing related information such as the exchange rates to be applied to trades in water allocations to:
 (a) adjust for the effects of the transfer on hydrology or supply security (transmission losses) or reliability; and
 (b) reflect transfers between different classes of water resources, unregulated streams, regulated streams, supplemented streams, ground water systems and licensed runoff harvesting dams.
 (9) Water trading zones, including ground water trading zones, should be defined in terms of:
 (a) the ability to change the point of extraction of the water from one place to another; and
 (b) the protection of the environment.
The volume of delivery losses in supplemented systems that provide opportunistic environmental flows will be estimated and taken into account when determining the maximum volume of water that may be traded out of a trading zone.
 (10) Exchange rates must not be used to achieve other outcomes such as to alter the balance between economic use and environmental protection or to reduce overall water use.
 (11) Trade in water allocations may occur within common