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The role of the commonwealth environmental water holder in annual water allocation markets
Author(s) -
Ancev Tiho
Publication year - 2015
Publication title -
australian journal of agricultural and resource economics
Language(s) - English
Resource type - Journals
SCImago Journal Rank - 0.683
H-Index - 49
eISSN - 1467-8489
pISSN - 1364-985X
DOI - 10.1111/1467-8489.12054
Subject(s) - agency (philosophy) , government (linguistics) , variety (cybernetics) , business , commonwealth , function (biology) , natural resource economics , water use , water trading , environmental economics , environmental planning , environmental resource management , environmental science , water resources , economics , geography , water conservation , ecology , computer science , sociology , social science , linguistics , philosophy , archaeology , artificial intelligence , evolutionary biology , biology
In recent years, the G overnment of A ustralia has bought back a significant amount of water entitlements in the M urray‐ D arling B asin ( MDB ) through its C ommonwealth E nvironmental W ater H older ( CEWH ) agency. This has been a welcome development, as it is an efficient way of securing water for the environment in the basin. However, the question of how to best manage water holdings held by the government is as yet unresolved. In particular, the question of whether and how should the CEWH engage in water markets is still grappling the government and academia alike. This paper addresses that question by evaluating total benefits to a range of water users, including the environment, under a variety of hydro‐climatic conditions. This is approached through running simulations based on environmental benefit function that varies with prevailing hydro‐climatic conditions. The findings indicate that the benefits are greater when CEWH actively participates in annual water allocation market and that such participation enables the CEWH to secure most water when it is needed the most by the environment. This suggests that policy should encourage the CEWH to further explore opportunities to engage with the water markets to the benefit of communities and the environment in the MDB .