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DWE Home > Home > Water Management > Water access and trade > Assigning Water Allocations

Water licensing and trading

Assigning Water Allocations

The current water allocation available under your water access licence can be sold. The sale does not affect future water allocations, which accrue to the licence. This allows you to sell water in your water allocation account that is surplus to your immediate needs or to buy water to meet a short-term requirement. If you do not hold a licence you can apply to the department for a new water access licence with a share component of zero units. The buyer must hold a water access licence to purchase allocation water. Initially, water allocation assignments can occur:

• within a regulated river water source within NSW;
• between the Murrumbidgee, Murray and Lower Darling regulated river systems; and
• interstate to and from the Murrumbidgee, Murray and Lower Darling Rivers.

Water allocation assignments will be extended to unregulated river and groundwater systems over the next few years as water extractions in these systems are metered

A typical dealing to assign current allocation

John is allocated 120 ML of water this year. He does not want to use all of his water allocation this season so he decides to sell 60 ML. John rings Bob, a local water broker, who finds a buyer for the allocation. The buyer, Mary, is allocated 80 ML this year but needs more to expand her cropping. Bob helps John complete the application for assignment of water allocation with Mary and submits the application. Once approved, the water allocation accounts of John and Mary will be adjusted. This dealing does not result in any change to the water access licences of John and Mary.

Do I need consent from other people?

When applying for the assignment of the water allocation, it is necessary for the seller and buyer to obtain the written consent of all holders of the licences to be credited and debited.

What should you check?

It is recommended that the buyer and seller contact a State Water officer who will check whether sufficient water is available in the seller's account; if the assignment would breach the buyer's account limit; and if the assignment is within the rules for such transactions.

What if I want water for more than one season?

If you want water for more than one season you should consider a term transfer of a water access licence. If you want a permanent arrangement you should investigate either the purchase of a licence or share component of a licence.

Will contracts of sale and purchase need to be drawn up?

We advise that contracts be drawn up to cover the conditions of the assignment.

How do I apply?

Water allocation assignments are available currently only on regulated rivers. Application forms are available from State Water.

For interstate assignments, you will need to complete the NSW State Water form as well as the required application form for the other state. If the water allocation is being moved into NSW, the forms should be submitted to State Water. If the water is being moved out of NSW, the forms need to be lodged with the relevant department in the destination state - either Lower Murray Urban and Rural Water Authority in Victoria or Department of Water, Land and Biodiversity Conservation in South Australia.

The NSW forms are available from the State Water website.

For the application to be processed quickly:

1. it must include details of both the seller and the buyer;
2. it must include signatures of all holders of the licences;
3. ensure that all invoices for water charges or fees have been paid; and
4. it must include the application fee.

What fees apply?

The application fee is $25 plus $1 per megalitre assigned, with a maximum charge of $75. The fee is to be submitted with the application form. For an interstate assignment, the other state's department will also charge an application fee.

How is the application processed?

When the application is received it will first be checked to ensure that it is complete and correct. State Water will then:

• assess the application against the dealings principles and the local water sharing plan dealings rules;
• check the water meter readings and account information;
• complete any outstanding actions to the existing accounts, such as carryovers; and
• in the case of interstate transfers, liaise with the other state.

The application will be rejected if the licence is currently suspended.

Both parties will be advised in writing of the result of the application, known as the notice of determination. If the assignment is approved, the water allocation accounts of both the buyer and seller will be adjusted and the dealing recorded on the NSW register of water allocation assignments.

Note: This information does not constitute legal advice.