11 May, 2008

THE AGE: Plan to make timber industry pay for rain

Melissa Fyfe
The Age, May 11, 2008

In a blow to Victoria's massive plantation industry, the State Government has moved to make thirsty timber plantations accountable for the water they use.

Companies such as Timbercorp may face extra costs as Government documents show it is considering making them pay for the water the trees suck up.

Many Victorians have sunk millions of dollars into the plantation industry because investments are tax deductible.

The move has worried the industry, which says it is being unfairly "picked on". But the documents show the Government is concerned that precious rain that would flow into groundwater and then to streams is intercepted by thousands of hectares of plantation trees, leaving less for farmers, rural towns and the environment.

Under the 2004 National Water Initiative, all Australian governments agreed that changes in land use — such as large-scale plantations — could significantly affect the amount of water available to others, and needed to be regulated. The Brumby Government, which adopted the commitment in its water plan, recently released a tender to develop such a policy. The tender documents indicate where the Government may be headed on the issue.

The Department of Primary Industries tender refers to all sorts of land use changes that affect water availability, but it clearly has the plantation industry in its sights.

It suggests the successful contractor consider a permit system or "market-based mechanisms", which the industry believes may mean it has to buy the water the trees use.

Asking companies to pay for the water trees use is controversial because it is, essentially, charging for the rain that falls on private property. Such a decision could have implications beyond the plantation industry.

"It is complicated and legally questionable about how you would charge a plantation grower for using the water that falls on their land," said Richard Stanton, manager of policy at the Australian Plantation Products and Paper Industry Council. He said the water use of plantations was exaggerated and there were far more significant issues to deal with.

The Government faces the tricky task of balancing the benefit of plantations — reducing carbon in the atmosphere, erosion prevention, better water quality — with the negative "third party" impacts of taking water out of the system.

A 2003 study said all types of reforestation in the Murray-Darling Basin would suck 600 billion litres of water from the system each year by 2020. The industry argues this overestimates the number of trees that will be planted, and its best guess is that, by 2028, plantations will take 50 billion litres from the basin.

The tender, called Impacts of land use change on water resources — policy analysis and development, shows that recent studies of south-western Victoria have found that plantations and climate change have sucked 6% to 10% of surface and groundwater from the region.

Matt Hillard, a spokesman for Victorian Agriculture Minister Joe Helper, said it was important for the Government to ensure resources were well managed.

Allan Hansard, chief executive officer of the National Association of Forest Industries, said it was too early to jump to conclusions but the industry should not be "picked on".

The companies that may be affected by any policy change include Timbercorp, Great Southern Plantations, ITC, HVP Plantations, Midway and Willmott Forests.

Under the tender, the contractor must report back with policy options by early October.
Where the trees are most thirsty

Areas where plantations are likely to be cutting water availability:
  • Some areas of the Strzelecki Ranges, including the Tarra Valley.
  • Parts of the Thomson and Latrobe river basins.
  • Groundwater aquifers in South Gippsland.
  • Surface and groundwater across much of south-west Victoria.

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