Irrigator and Environmental Water Management Adaptation to Climate Change and Water Reallocation in the Murray–Darling Basin

Abstract

In an earlier paper (Kirby et al. 2014a), we showed that climate change and a new policy which reallocates water to the environment will impact both the flow of water and the income derived from irrigation in the Murray–Darling Basin. Here, we extend the analysis to consider irrigator and environmental water management strategies to adapt to these new circumstances. Using an integrated hydrology-economics model, we examine a range of strategies and their impact on flows and the gross income of irrigation. We show that the adaptation strategies provide a range of flow and economic outcomes in the Basin. Several strategies offer significant scope to enhance flows without large adverse impacts on the gross income of irrigation overall. Some environmental water management strategies enhance flows in the Murray part of the basin even under the drying influence of a projected median climate change. Irrigator strategies that include carryover of water in storage from one year to the next provide for lesser year to year variability in gross income and may be regarded as more advantageous in providing security against droughts. Flows and the gross income of low value irrigation industries strategies are sensitive to climate change, irrespective of adaptation strategy. Should a projected dry extreme climate change be realized, no strategy can prevent a large reduction in flows and also in gross income, particularly of low value irrigation industries. Nevertheless, environmental water management strategies mitigate the impact on flows, and in some cases may also help mitigate the impacts on gross income. High value irrigation industries are less affected (in terms of gross income, though net income will reduce because of rising water prices) by projected climate change, consistent with observation in the recent long term drought.