Selling water shares to fund customer credits

As part of the Irrigators Share Distribution, eligible customers with individual delivery shares of less than 0.25 ML per day will receive credits to their accounts in July 2022. These credits will be funded by the sale of high and low reliability water shares and allocation.

To guide the sales process, external water trading experts were engaged by GMW to develop a Water Trading Strategy (PDF, 255 KB).

The Water Trading Strategy outlines how and when the water shares will be sold.

Process

We have recently appointed a panel of accredited water brokers to manage the sale of this allocation.

Water shares will be sold via a public online auction through a single broker, Waterfind P/L. Further details on the timing of this will be announced.

The following are accredited water brokers that make up the GMW panel:

Name Website Phone
Integra Water Services https://www.integrawaterservices.com.au/ (03) 5824 3833
Ruralco Water https://www.ruralcowater.com.au/  1300 007 939
AGnVET https://agnvet.com.au/services/water-broking/ (03) 5821 2477
H2OX https://xpansiv.com/h2ox/ 1800 988 118 
Planright http://www.planright.com.au/water-broking.html (03) 5824 1322
Waterfind https://www.waterfind.com.au/ 1800 890 285

 

Water shares and allocation will be offered for sale in a range of parcel sizes to enable buyers to participate, regardless of their budget.

GMW will determine the parcel sizes and timing of placement into the market.

Timing

Water share sales will take place between November 2021 and April 2022 to enable the rebates on eligible customers’ fixed charges accounts to be issued in July 2022.

Quantity

High and low reliability water shares and allocation will be sold to fund the customer credits.

About 1220 ML of High Reliability Water Shares (HRWS) and 690 ML of Low Reliability Water Shares (LRWS) will be sold, as well as the allocations these water shares will receive from 1 July 2021.

And from early 2022 additional allocation may become available from the Goulburn and Murray offset accounts. These have been used to maintain system reliability as water shares were issued to the Commonwealth during Stage 2 works of the Connections Project.

The available volume will be confirmed with the completion of the final audit of the Connections Project in late 2021. Following the audit and consideration of all Government commitments, this allocation may be sold on the open allocation market from early 2022.

Frequently asked questions

Introduction

The GMW Connections Project involved a $2 billion investment to modernise irrigation infrastructure in the Goulburn-Murray Irrigation District (GMID).

On-ground modernisation works have now been effectively completed. This means the final water recovery can now be distributed through the Irrigators Share Distribution.

What is the Water Trading Strategy and why has it been developed?

As part of the Irrigators' Share Distribution, eligible customers with individual delivery shares of less than 0.25 ML per day will receive credits to their accounts in July 2022. These credits will be funded by the sale of high and low reliability water shares as part of the Irrigators' Share Distribution. The Water Trading Strategy guides the process for selling these shares.

The Water Trading Strategy has been designed to maximise returns to customers while minimising administrative costs.

Who was involved in developing the Water Trading Strategy?

External water trading experts were engaged by GMW to develop the Water Trading Strategy to guide the sale of these water shares.

The Irrigators’ Share Stakeholder Advisory Group, which consists of representatives from the GMID Water Services Committees, was consulted and helped shape the Water Trading Strategy.

How much water will be sold?

The current estimated volumes of water available for sale (to fund benefits for delivery share holders below the 0.25 ML/day thresholds) are:

  •  About 1220 ML of High Reliability Water Shares (HRWS): About two thirds of this volume will be Zone 1A entitlements. There will also be a small volume of Zone 1B water shares available, whilst the balance will be made of a mixture of Zone 6 and Zone 7 water shares.
  • About 690 ML of Low Reliability Water Shares (LRWS): The make-up of this parcel is similar to the HRWS, with about two thirds consisting of Zone 1A LRWS, and the balance made up of Zones 1B, 6 and 7 LRWS.
  •  Allocation: These water shares will also receive allocations from 1 July 2021 up to the time they are sold. All the available allocation will be sold separately, and the financial benefit provided to delivery share holders below the threshold.

Whose role is it to implement the Water Trading Strategy?

GMW holds the water to be sold for financial benefits and is responsible for implementing the Water Trading Strategy.

How and when will the water be traded?

Water entitlements will be sold via a public online auction. Waterfind P/L will manage the sale of these shares.

Name Website Phone
Integra Water Services https://www.integrawaterservices.com.au/ (03) 5824 3833
Ruralco Water https://www.ruralcowater.com.au/  1300 007 939
AGnVET https://agnvet.com.au/services/water-broking/ (03) 5821 2477
H2OX https://xpansiv.com/h2ox/ 1800 988 118 
Planright http://www.planright.com.au/water-broking.html (03) 5824 1322
Waterfind https://www.waterfind.com.au/ 1800 890 285

 

These sales will take place between November 2021 and April 2022 to enable the rebates on eligible customers’ fixed charges accounts to be issued in July 2022.

GMW will work with the broker/s to determine a reserve price that reflects market value for all shares and allocations to be traded.

So, there will be several opportunities to buy water?

Yes, the first is the opportunity to buy water shares at the online auction.

There will also be water allocations for sale. The timing for the sales is between November 2021 and April 2022.

And from early 2022 additional allocation may become available from the Goulburn and Murray offset accounts. These have been used to maintain system reliability as water shares were issued to the Commonwealth during Stage 2 works of the Connections Project.

The available volume will be confirmed with the completion of the final audit of the Connections Project in late 2021. Following the audit and consideration of all Government commitments, this allocation may be sold on the open allocation market from early 2022.

Will there be different parcel sizes available?

Water shares will be offered for sale in a range of parcel sizes to enable buyers to participate, regardless of their budget.

GMW will determine the parcel sizes and timing of placement into the market.

How will I find out about the auction?

Once the details of the online auction are finalised, GMW will provide more information on the Irrigators' Share Distribution page.

Could selling this much water affect the market?

The Water Trading Strategy has been designed to minimise potential market disruption / distortion whilst still selling the available water.

Selling about 1220 ML of High Reliability Water Shares and about 690 ML of Low Reliability Water Shares is not considered to be a volume high enough to affect or distort the market.

How can I be confident there is a transparent process for the sale of these water shares?

The Water Trading Strategy includes accountability and transparency safeguards to provide equal access for all interested parties and ensure GMID water users are aware of opportunities and not excluded from them.

The Water Trading Strategy complies with all relevant trading requirements (including Basin Plan requirements).

GMW will also be responsible for making disclosures required under the Basin Plan trading rules. These disclosure requirements apply where an approval authority such as GMW is also involved as a market participant. They cover:

  • Ensuring that purchasers are aware that GMW is the seller, prior to submitting the trade for approval.
  • Publishing the outcomes of any completed water trade that GMW is a party to on its website as soon as possible after the trade is approved. These will be found at the About Us page.
  • Continuing to maintain effective ethical wall arrangements that ensure there is clear separation of decision making and no inappropriate information sharing between staff in relation to:
    • Making seasonal determinations.
    • Decisions to trade water products.
    • Approvals of trade applications.
    • Financial management and accounting for proceeds of the sales program.
    • Publishing a final public report on the program outcomes.

Where can I find more information?

Once the details of the auction are finalised, GMW will provide more information on the Irrigators' Share Distribution page.

You can also phone our Contact Centre for more information on 1800 013 357 or email ISDProject@gmwater.com.au