Market Proving Study draft

NORTHERN ADELAIDE IRRIGATION SCHEME:MARKET PROVING STUDY

March 2015

For: District Council of Mallala Gary Mavrinac

Northern Adelaide Irrigation Scheme:Market Proving Study

February 2015

For: District Council of MallalaGary Mavrinac

Version Date Author Reviewed Issued by Final 17/03/2015 J Kelly L Smith J Kelly

Created by Arris Pty Ltd

Bld 11b, Gate 2c Hartley Grove URRBRAE SA 5064 t 08 8313 6706 f 08 8313 6752 ACN 092 739 574

Client Gary Mavrinac

Name of Organisation

District Council of Mallala

Name of Project Northern Adelaide Irrigation Scheme: Market Proving Study

Name of Document

Project Number

Document Version Final

Cover

Sensitivity

This document and the information, ideas, concepts, methodologies, technologies and other material it contains remain the intellectual property of Arris Pty Ltd. The document is not to be copied without the express permission of at least one of the above parties.

Disclaimer

This report is presented “as is” without any warrantees or assurances. Whilst all reasonable efforts have been made to ensure the information provided in this review is current and reliable, Arris Pty Ltd does not accept any responsibility for errors or omissions in the contents.

Document Delivery

Arris Pty Ltd provides this document in either printed format, electronic format or both. Arris considers the printed version to be binding. The electronic format is provided for the client’s convenience and Arris Pty Ltd requests that the client ensures the integrity of this electronic information is maintained. Storage of this electronic information should at a minimum comply with the requirements of the Commonwealth Electronic Transactions Act (ETA) 2000. Where an electronic only version is provided to the client, a signed hard copy of this document is can be provided by Arris Pty Ltd if requested by the client.

Page i

Table of Contents List of Tables ........................................................................................................................ ii List of Figures ....................................................................................................................... ii Abbreviations ...................................................................................................................... ii 1 Introduction ................................................................................................................. 1 2 Support for the NAIS Project ....................................................................................... 2 3 Demand for RCW ......................................................................................................... 2 3.1 Seasonal demand for recycled water .................................................................. 5

4 Uses for Recycled Water ............................................................................................. 6 5 Farm Investment ......................................................................................................... 6 6 Price for Water ............................................................................................................ 7 6.1 Capital Contribution ............................................................................................. 7

7 Other Issues ................................................................................................................. 8 8 Discussion .................................................................................................................... 8 Appendix A ‐ Northern Adelaide Irrigation Scheme: Market Proving Study,

Expression of Interest Appendix B ‐ Fact Sheet: Guidelines and Considerations When Using Recycled

Water

Page ii

List of Tables Table 1 Water demand per region identified in the EoI ................................................... 2 Table 2 Discussion of factors impacting the identification of customers

and potential demand .......................................................................................... 5 Table 3 Seasonal demand for RCW as indicated in the completed EoIs .......................... 5 Table 4 Potential use of recycled water by industry sector ............................................. 6 Table 5 Shows levels of on‐farm investment and increase in land values ....................... 6 Table 6 Water required at different price points as established in the EoI ..................... 7 Table 7 Summary of EoI participants willing to pay a capital contribution ...................... 7

List of Figures Figure 1 Map of potential areas that could be supplied recycled water in

the Mallala Council area. ..................................................................................... 1 Figure 2 Spatial distribution of water demand .................................................................. 3 Figure 3 Volumes of RCW required by region .................................................................... 4

Abbreviations Abbrev Units Description CALD Culturally and Linguistically Diverse EoI Expression of Interest ML ML mega litres NAIS Northern Adelaide Irrigation Scheme RCW Class A recycled water

Project Title NAIS Market Proving Study Page1 Arris Pty Ltd

1 Introduction A Market Proving Study for the Northern Adelaide Irrigation Scheme (NAIS) was carried out by Arris Pty Ltd from December 2014 to February 2015. This study was conducted and provided to the District Council of Mallala for their feasibility study for the supply of recycled water north of the Gawler River in the Mallala Council area. It was decided that the study be conducted with demand being demonstrated in areas from A ‐ F (Figure 1). Areas A ‐ F have been named for planning purposes only and are the most likely areas to be supplied with recycled water. These areas will also provide information with respect to future demand and potential staging options for the development of a larger system when new water supplies are identified. The Council, through a Memorandum of Understanding (MOU) with SA Water, is investigating the demand for a scheme to supply 8GL of winter water to horticulture and other agricultural users. Over time, it is anticipated that the scheme will be capable of supplying over 20GL per year. Council is committed to expanding the food producing area supplying local and international markets. The 8GL will support:

• 1,000 new jobs in agriculture; • 2,500 new service jobs; • 1200 ha of land developed for irrigation with over $150M of private investment; • Business opportunities for regional transport, services, packaging, processing

and tourism businesses; and • Links to education and training opportunities (e.g. Two Wells School,

Roseworthy Campus).

Figure 1 Map of potential areas that could be supplied recycled water in the Mallala Council area


2 Support for the NAIS Project Following an advertising program where advertisements were placed in the local press making potential customers aware of the potential new opportunity, Arris completed Expressions of Interest (EoI, Appendix A) with potential customers for the supply of Class A recycled water. A Fact Sheet: Guidelines and Considerations When Using Recycled Water (Appendix B) was also provided to people seeking to complete the EoI. It can be seen in the EoI that potential customers were to provide information on:

• Current business including nature of business, experience and location; • Intended use for recycled water; • Barriers to development including roads, power, gas and planning issues; • RCW use requirements including land area, quantity of water and seasonal

demand; • Proposed development to be undertaken by the customer including proposed

investment and value add to existing assets; • When they require RCW for development of a potential staging strategy; • Willingness to pay for water at defined price points; • Willingness to participate in a capital contribution scheme to support the project

and to reduce potential water pricing models (discounted price for water). There was a high level of support for the proposed NAIS project. It would be fair to say that landholders and potential customers were aware of the 'need' for further expansion of RCW irrigation into the Mallala district. Potential customers who completed EoIs fell largely into the following groups:

• Landholders who were looking to add value to their property; • Landholders that were interested in pursuing different farming activities; and • Irrigators who have speculatively bought land in the region with the belief that

RCW would be supplied in time.

3 Demand for RCW Through the delivery of this project it was clear that there was significant demand for RCW for irrigation. The EoI process has identified 32.962GL of demand (Table 1). The spatial distribution can be seen in Figure 2 with area values given in Table 1 and Figure 3. Table 1 Water demand per region identified in the EoI

Area (Figure 1) Customers Volume (ML) % of Total Volume

A 29 2,789 8.5 B 12 6,568 19.9 C 16 13,045 39.6 D 5 5,140 15.6 E 1 800 2.4 F 3 870 2.6

Barossa 1 3,750 11.4 Total 67 32,962ML 100%

There were a number of limitations to the process that has limited the identification of demand discussed in Table 2.


Figure 2 Spatial distribution of water demand


Figure 3 Volumes of RCW required by region

2,789ML

800ML

5,140ML

6,568ML

13,045ML

3,750ML


Table 2 Discussion of factors impacting the identification of customers and potential demand

Limitation Discussion

Quick turnaround of the study

Due to the timelines put in place that are driven by external factors including funding opportunities, internal timelines (Council), ... Arris will continue to collect EoIs past the life of the project, update the data base and pass on that information to Council.

Potential customer expectations

It was clear that potential customers in areas B and C had a high expectation that they were favoured by location therefore there was a high level of interest in that area. The demand trended down as the survey moved from west to east. Arris feels that interest in RCW would be similar to areas A, B & C if adequate time and information was given to these regions. Arris believes that given adequate time, similar level of demand would be achieved in the areas tending to the east.

Reliance on advertising

The highest success rate for completion of EoIs came from direct contact where other potential customers were indicated by word of mouth introductions. This was particularly true for Culturally and Linguistically Diverse (CALD) participants. This also influenced the distribution of demand as potential customers had already identified location for use of water.

Diversity in demand for water

The project was clearly targeted at potential irrigation customers. This has limited the identification of potential customers for water that have high water demand that could be relocated to the region. This would have significant benefits in increased water demand, increased employment and more evenly spread water demand over the year. Arris has undertaken a number of assessments for water authorities identifying other potential customers for water. In a recent project for South East Water (Victoria) industrial use of the RCW represents >50% of the water demand.

3.1 Seasonal demand for recycled water To gain an understanding of the seasonal demand for recycled water, demand was assessed. The weighted demand was calculated from the product of seasonal percentage requirement, as indicated in the EoI, and total water demand. Table 3 Seasonal demand for RCW as indicated in the completed EoIs

Summer Autumn Winter Spring Percentage of total demand 40.7% 23.4% 12.7% 23.2% Volume (ML) (calculated) 13416 7713 4186 7647 64 (95%) growers responded to the seasonal demand assessment which has been used to calculate the seasonal demand. This is an important factor in the development of the storage‐demand model.


4 Uses for Recycled Water There are a wide range of potential crops that have been identified which could potentially be grown with recycled water. Rather than discuss potential crops, cropping systems have been grouped for analysis of their respective water demand. Breakdown of cropping systems include:

• Permaculture (Almonds, Viticulture and Olives); • Broadacre vegetables (Potatoes, Cauliflower, Carrots, Bunch lines, ...); • Field and Fodder Crops (Cereals, Legumes, Lucerne, ...); • Greenhouse and Protected Cropping; • Other (Domestic trees and gardens, Sand Processing, other Non‐agricultural use)

The breakdown of cropping systems and demand is given in Table 4. Table 4 Potential use of recycled water by industry sector

Intended Use Customers Volume (ML) % of total Volume

Permaculture 6 4,257 12.9 Broadacre 23 15,785 47.9 Field and Fodder Crops 7 2,328 7.1 Greenhouse and Protected Cropping 26 9,794 29.7 Other 5 798 2.4 Total 67 32,962ML 100% Note: there is likely to be some variation in these figures as a number of growers indicated that they may participate in more than one sector. These were delineated by the sector they were currently growing in.

5 Farm Investment The demonstration of farm investment is important in demonstrating the investment by landholders in accessing RCW. The total investment as indicated by the 81% of growers that completed this section was $455.19M (Table 5). Table 5 Shows levels of on‐farm investment and increase in land values

Item Investment ($) Land Value* 296.829M Irrigation Equipment 18.522M Packing and Processing 34.505M Other Infrastructure 105.335M Total 455.191M *The EoI did not distinguish between the increase in land value as a result of having water or the potential cost to farmers. The high value of other infrastructure indicated came mainly for the greenhouse and protected cropping sector for the investment in greenhouses.


6 Price for Water There was significant variation in proponents’ willingness to pay for water. Only 67% of proponents completed the pricing section of the form. Some participants viewed this as a commitment to pay for water. They preferred to abstain from comment rather than commit to an actual price at this point. However the summary of the demand for water at different price points is shown in Table 6. Although only 67% of proponents completed the water pricing questions it represented 96% of the total water demand. Table 6 Water required at different price points as established in the EoI

Proposed Annual Cost of Water Price Points Item $1050/ML $750/ML $510/ML $400/ML

Volume of Water (ML) 16,539 16,627 25,982 31,568 Percentage of Water* 52% 53% 82% 100% * Represents percentage of the total volume of water where proponents completed the willingness to pay for water at the different price points.

Those who demonstrated an increased willingness to pay a higher price for water were the higher intensity industries including greenhouses and protected cropping, growers that indicted that they would transition from broadacre vegetables to greenhouses, and viticulture.

6.1 Capital Contribution The willingness to pay a capital contribution as a one off payment was poorly responded to, with:

• 6 proponents answering yes; • 7 proponents answering no; and • 10 answering that they would need to see a business case.

At the different level of capital contribution from $1000, $2000 and $3000 per ML the volume of water represented was 2355ML, 769ML and 770ML respectively (Table 7). Table 7 Summary of EoI participants willing to pay a capital contribution

Capital Contribution $1,000 $2,000 $3,000 Participants 6 3 3 Volume of water (ML) 2355ML 769ML 770ML Although the response to this question was poor, based on discussions with the growers, Arris feels there would be a higher level of interest if it came down to paying a capital contribution versus the scheme failing and no provision of water. If this were the case, growers would be more willing to participate in a discussion around a once off contribution. This would be particularly true if growers were provided an option to pay over time.


7 Other Issues Examining barriers to the development of land for RCW were influenced largely by the region where the proponent was seeking to gain supply. In the older more established region A, and older more established horticultural area, only four proponents answered indicating that roads, gas and electricity were considered an issue. However in the other regions, a high proportion of proponents considered that roads power and gas were an issue. The requirement for gas supply was largely driven by the greenhouse growers, as expected. However planning and potential sub‐division opportunity is seen as the biggest barrier to the development of new country for horticultural irrigation. Many of the CALD growers who generate income from smaller intense greenhouse development are looking for the opportunity to subdivide to smaller areas. In conversation with the grower who highlighted the need for planning changes to allow smaller developments, their desire to live on farm was stated. That is, the area should be inclusive of adequate area to build production and domestic infrastructure.

8 Discussion This market proving study has indicated there is a strong demand for water outside the traditional NAP horticultural region. Expressions of interest for 32.962ML of water per annum have been completed. It is recognised that at this stage growers have not made a binding commitment, however it is likely that a high percentage of these EoIs could be converted to water contracts. For the purpose of developing a feasibility study to supply 8,000ML of water into the District Council of Mallala, this project highlights the high level of interest in getting this sustainable water resource.


Appendix A ‐ Northern Adelaide Irrigation Scheme: Market Proving Study, Expression of Interest

Northern Adelaide Irrigation Scheme

MARKET PROVING STUDY Expression of Interest

Northern Adelaide Irrigation Scheme The District Council of Mallala is seeking Expressions of Interest (EoI) from parties who are interested in buying recycled water for irrigation use. The Council, through a Memorandum of Understanding (MOU) with SA Water, has the capacity to provide 8GL of winter water to horticulture and other agricultural users. Over time, it is anticipated that the scheme will be capable of supplying over 20GL per year. Council is committed to expanding the food producing area supplying local and international markets. The 8 GL will support: • 1,000 new jobs in agriculture; • 2,500 new service jobs; • 1200 ha of land developed for irrigation with over $150M of private investment; • Business opportunities for regional transport, services, packaging, processing and tourism

businesses; and • Links to education and training opportunities (e.g. Two Wells school, Roseworthy Campus).

Background

In 1999 the Virginia Pipeline Scheme (VPS) was commissioned to deliver high quality recycled water from the Bolivar Wastewater Treatment Plant (WWTP) to the horticultural production area around the township of Virginia. This scheme was later expanded to Angle Vale.

The recycled water is produced at the Dissolved Air Floatation and Filtration plant (DAFF) located at the Bolivar WWTP site. SA Water is contracted to supply 19.5 GL per annum of recycled water to the VPS over a calendar year once the scheme is fully operational, and 12 GL per annum of this must be made available during the summer peak period.

The VPS pipelines and DAFF plant are currently operating at capacity during the summer peak period. However, about 8 GL per annum of unused capacity, additional to the quantity of recycled water currently contracted to Water Reticulation Services Virginia, can be made available for supply to growers. This water will be stored and supplied throughout the growing season.

Mallala NAIS Food Production Area

NOTE: Areas A ‐ F have been named for planning purposes only and are the most likely areas to be supplied with recycled water.

Process to Secure Water This water demand Expression of Interest will form the basis of assessing the feasibility of establishing a new irrigation area within the district, and will assist Council and State Government to source funding agencies to develop the scheme.

The Council and its advisors will use these Expressions of Interest to define the extent and staging of the scheme. They will then work with SA Water to secure funding for the scheme and then to have it designed and constructed.

During the design stage the Council will ask you to enter into a Water Supply Agreement (the expected Customer Rules are set out below) which will allow the scheme to proceed.

All Expressions of Interest received will be assessed by a panel headed by SA Water and the Department of State Development to determine which users/projects will provide the best return on investment based on the available water. Ultimately, proposals that fit with the practical development of an irrigation scheme and provide greater economic growth/return will given priority.

Customer Rules It is anticipated the system will run with similar conditions and requirements to the Virginia Pipeline Scheme, including:

• The supply of Class A Reclaimed Water for unrestricted agricultural irrigation; • Water will be supplied with a guaranteed flow rate of 0.54% of the annual contracted

volume on any specified day; • Water will be supplied under a 'Take or Pay' contract; and • Growers will be required to have on farm storage with an air gap between supply and

storage.

What to do To take up the opportunity to secure water, potential customers should:

Complete the Expression of Interest and return it to District Council of Mallala NAIS Expression of Interest PO Box 18 Mallala, SA 5502

Further information For further information please contact

Jim Kelly Arris Pty Ltd 8313 6706

APPLICATION Customer Details Applicant Name: Legal entity(organisation or individual) for contracts ABN:

ACN: Postal Address: (For written correspondence) Contact Person:

Position:

Telephone:

Mobile:

Email:

Fax:

NOTE: We may seek further information from the contact person, if required.

Business Type Is the applicant a:

Sole Trader Partnership Business Company

Property Location Are you a current landholder in the Areas A ‐ F Yes / No

Site Address: (Location where recycled water will be used) :

Indicate on the map the approximate location of the property:

If you are not a current landholder in the region please mark your preferred location:

Area A Area D

Area B Area E

Area C Area F

Non of the above Comment:

Intended Use Your Industry Sector (e.g. Field crops, greenhouse, high‐intensity greenhouse, livestock, processing, industrial, etc):

Proposed use of recycled water (e.g. irrigation, hydroponics, ...):

Are there any known barriers to undertaking your proposed project, e.g.:

Roads Power Gas Planning Other ________________________________________________________________

Usage Requirements Area (proposed irrigation area)______________________________________________ha

Volume (annual volume of water required)_______________________________________ML

Is the timing of water delivery important (i.e. seasonal demand)? Yes / No

Please indicate the seasonal percentage distribution of your water requirement

_____% Summer _____% Autumn _____% Winter _____% Spring

Business Information Describe Current Business Operations (e.g. grazing, irrigated horticulture etc)

Do you have irrigation experience? Yes / No

Do you have existing irrigation infrastructure? Yes / No

If yes, describe the system (e.g. drip, spray, centre pivot etc)

What crops are currently grown? _________________________________________

_____________________________________________________________________

Years in business ______________________________________________________

Have you discussed the project you intend to use this water for with PIRSA or any other government agency? Yes / No

If Yes, please provide some details:

Will this water replace or help expand an existing business? Yes / No

If yes, provide details of the existing business location and a brief summary of the intended expansions below.

To assist the Council in seeking government and private investment in the proposed scheme the economic investment ratio (government vs private sector) is important. To the best of your ability please provide, your potential investment in:

• Land ______ha $___________

• Irrigation Equipment $___________

• Processing and packaging equipment $___________

• Other infrastructure $___________

Please indicate your timeline for water delivery by placing a percentage of your total ML requirement against each year after scheme initialisation.

Year 1 ______%

Year 2 ______%

Year 3 ______%

Year 4 ______%

Year 5 ______%

Year 10 ______%

Water Pricing The following pricing model options have been developed and change on a sliding scale depending on government funding and user capital contribution. However, there potentially could be some flexible terms on the upfront capital contribution pricing agreement.

Considering Only Grant Funding Please indicate the volume of water you would be willing to purchase at the following price points.

Funding Amount Cost/ML Volume of Water No grants or customer contribution $1050/ML

One third of grant approved $750/ML Full grant approved $510/ML

Full grant approved (Alternative scheme design)

$400/ML

Considering Only Customer Capital Contribution Please indicate the volume of water you would be willing to purchase for each capital contribution/pricing combination. Note that the capital contribution is a one‐off cost based on your contracted annual water volume.

Capital contribution/ML Annual Discount $/ML Volume of Water $1000 ‐$100/ML ML

$2000 ‐$200/ML ML

$3000 ‐$300/ML ML

Other Comments

Declaration I/We declare that:

• The information provided in this EoI is true and complete to the best of our/my knowledge;

• I/we understand that this EOI is non‐binding for either me/us or the Council.

Applicant's Signature: Date:

Useful Information Soil and Water Volume of irrigation water 1,000 litres (L) = 1 kilolitre (kL) = 220 gallons (gal) 4,550 kL = 4.55 megalitres (ML) = 1,000,000 gal 1,000 kL = 1 ML = 220,000 gal 1 acre foot (ac ft) = 1.23 ML = 270,570 gal

Area 10 000 square metres = 1 hectare = 2.47 acres 435 740 square feet = 0.405 hectare = 1acre

To convert Multiply Gallons/acre kilolitres/hectare 0.0112 Kilolitres/hectare gallons/acre 89.2

Indicative crop demand for water to assist in the calculation of irrigation water demand

Crop Indicative irrigation water requirement in average

rainfall year (ML/crop/ha/year) Almonds 5.5 ‐ 7.5 Capsicum 3.0 ‐ 5.0 Carrots, parsnips and turnips 4.0 ‐ 5.0 Brassica 4.0 ‐ 5.0 Celery 3.0 ‐ 5.0 Flowers 4.0 ‐ 8.0 Lucerne 8.0 ‐ 10.0 Olives 5.0 ‐ 6.0 Onions 5.0 ‐ 6.5 Potatoes 4.0 ‐ 7.0 Lettuce 4.0 ‐ 6.0 Vines 5.0 ‐ 6.0

Low Technology Polyhouse Indicative irrigation water requirement (kL/crop/150m2 greenhouse)

Cucumbers 120 ‐ 170 Tomatoes 200 ‐ 280

Source: Rural Solutions

These are indicative volumes and growers will need to make their own site specific determinations of water demand that include changes due to things such as seasonal variation and drought etc.


Appendix B ‐ Fact Sheet: Guidelines and Considerations When Using Recycled Water

The horticultural industry across the Northern Adelaide Plains has undergone significant expansion after the installation of the Virginia Pipeline Scheme in 1999. The Virginia Pipeline Scheme provides 100GL Class A recycled water with some growers relying solely on recycled water for production. The scheme has provided an estimated $1 billion worth of benefit to the district.

The District Council of Mallala is proposing an expansion to the Virginia Pipeline Scheme that will provide a further 8GL of winter water through the Mallala Northern Adelaide Irrigation Scheme (NAIS) for horticultural and agricultural users. Over time, it is anticipated that this expansion scheme will be capable of supplying over 20GL per year.

The proposed NAIS scheme will provide Class A water to a greater network of growers, enabling significant opportunities to build on existing agricultural activities, maximising the potential of land resource assets, and further enhancing South Australia’s food security.

Recycled water is widely used in Australia and overseas for the production of pasture, fruit and vegetable crops, industrial and domestic use. Many farmers and industrial operations have benefited from reliable, secure and, often, a cheaper source of water that is not climate dependant.

Recycled water refers to water that can be recycled from:

• rainwater (rain caught from the roof or other direct methods of rain capture);

• stormwater (rainwater that has reached the ground or other hard surfaces on the ground like roads, ovals, paddocks);

• greywater (from the bath, shower, basin and maybe the kitchen); and

• treated effluent (from a sewage treatment plant).

Although recycled water is seen as an increasingly valuable water resource in agricultural applications, recycled water can also represent a source of additional nutrition with research showing higher growth rates for crops under irrigation with recycled water.

This fact sheet addresses some of the common issues prospective users and their advisors raise about the application of recycled water. Further to this, it will provide valuable information that is specific about the Northern Adelaide Plains at this point.

Water Demand Expression of InterestThe Expression of Interest for recycled water is an important component in understanding the temporal and spatial demand for water.

It is important that potential customers understand that although they are being asked to sign the Expression of Interest document it is non-binding. The Expression of Interest is not a supply agreement, hence, is not locking the signatory into any unwanted obligations.

However, their details will be retained and they will be contacted as further information is received.

The EOI will not only be useful in gaining information about the demand for water, but it will also be valuable in demonstrating the demand for water to third parties to help secure additional funding and investment.

The pipe routeThe recycled water pipeline route for the NAIS has not been developed yet, and will be dependent on the location of EOI signatory properties. The map given in Figure 1 highlights the areas most likely to receive recycled water, however, these areas are not confirmed. It will not pass all properties and final design will be inclusive of customer demand (volume of water and spatial distribution) and the least cost model.

Growers will be liable for cost of delivery of water from the recycled water pipeline to their on-farm storage and/or irrigation infrastructure.

Fact Sheet

Guidelines and Considerations When Using Recycled Water

Cost of Water The proposed pricing model has been developed on a sliding scale that is dependent on additional funding amounts and capital contribution. Government funding is being sought, and the possibility of some user capital contribution is being investigated.

The following recycled water price points have been developed considering only government grant funding.

Funding Amount Cost/ML

No grants or customer contribution

$1050/ML

One third of grant approved $750/ML

Full grant approved $510/ML

Alternate system $400/ML

The following recycled water price points have been developed considering only user capital contribution (no government funding).

Capital contribution/ML Cost/ML

$1000 -$100/ML

$2000 -$200/ML

$3000 -$300/ML

Figure 1. Mallala NAIS food production area. Note: Areas A - F have been arbitrarily named for planning purposes only and are the most likely areas to be supplied with recycled water.

It is important to understand that the final cost of water will be established as part of the full business case and will be inclusive of:

• customers’ capacity to pay, as financial viability of customers will be critical to the long term sustainability of the project;

• customers’ capacity to contribute to capital costs;

• the cost of the project; and

• the available state and federal funding.

Guidelines for application recycled waterAll recycled water projects are regulated and require Department of Health and/or EPA approval. This project will meet these requirements and work with users to meet the regulatory requirements as required by the appropriate agencies.

Recycled water must be used in strict accordance with the guidelines outlined in the South Australian Guidelines for the use of reclaimed water. For the NAIS project Class A (South Australian Guidelines) recycled water will be supplied to customers and will be “fit for purpose”.

Safe use of recycled waterThere are no restrictions on industrial use, irrigation methods or the types of crops that can be grown when using Class A recycled water. Class A is the highest rating for recycled water used for irrigation and is equal to the most stringent guidelines anywhere in the world (Table 1).

Fact Sheet Guidelines and Considerations When Using Recycled Water

SalinityThe water quality provided by the Virginia Pipeline Scheme is well known and can be used as an indicative indicator of the water that will be supplied by the NAIS. Between 2010 - 2012 the three year average for salinity was 1161 mg/L (TDS) and the average value of nutrients in the water was $65.85 / ML.

TDS(mg/L)

N(mg/L)

P(mg/L)

K(mg/L)

2012

Oct-Dec 1340 10.9 0.2 38.8

Jul-Sept 1311 13.5 0.5 34.7

Apr-Jun 1104 10.0 0.0 34.6

Jan-Mar 1190 5.2 1.1 35.9

2011

Oct-Dec 1295 13.9 0.4 37.7

Jul-Sept 1251 13.8 0.1 34.6

Apr-Jun 1030 16.7 0.5 38.4

Jan-Mar 1136 8.6 0.2 39.0

2010

Oct-Dec 1242 12.9 1.1 39.3

Jul-Sept 1027 15.6 1.2 32.1

Apr-Jun 913 18.8 1.0 35.1

1097 12.9 0.5 37.8

Average 1161 12.7 0.6 36.5

$/ML $17.26* $1.73* $87.74*

Total $/ML $106.20

*fertiliser prices supplied by Elders Virginia (Jan 2015)

Three year average salinity and value of nutrients in recycled water supplied through the Virginia Pipeline Scheme

How can using recycled water affect my operations and soils?The use of recycled water may require a review of soil management to account for differences in recycled water quality to other water sources and to meet regulatory requirements.

The Class description of recycled water only refers to the microbiological (health) aspect of recycled water. It is important to understand that the class of recycled water dose not refer to its suitability for irrigation on a crop or farm by farm basis. The chemical status of the water will need to be assessed against soil properties and crop suitability.

Sodium Absorption RatioSodium Absorption Ratio (SAR) is the amount of sodium present in the water, relative to the amounts of calcium and magnesium. High SAR can impact negatively on soil structure. The SAR of the recycled water from the scheme is expected to be in the order of 6.5 to 8 and will require some management. Maintenance applications of gypsum will help prevent the SAR from causing soil degredation.

BoronElevated concentrations of boron are often found in recycled water compared with groundwater and surface-waters depending on location and soil properties. It is an essential nutrient for plant growth and function, however, plant sensitivity to Boron varies significantly between plant species and base-line soil concentrations of Boron.

Heavy MetalsIn highly treated wastewater (Class A) most metals are removed in the treatment process. Heavy metal concentrations are not considered to be a significant factor in this scheme. The NAIS project will meet the stringent South Australian guideline requirements.

NutrientsCrop nutrition management through the application of nutrients to optimise production is often a significant cost to farmers. Recycled water often contains significant amounts of Nitrogen: Phosphorus : Potassium (N:P:K). Plant available nutrient will be applied when irrigating with recycled water and can meet part, if not all, of the nutrient budget of the crop.

The value of the nutrient in recycled water supplied to the VPS is $106.20/ML. Nutrient values have been calculated from bulk fertiliser prices.


Useful ResourcesANZECC 2000. Australian and New Zealand Guidelines for Fresh and Marine Water Quality (Chapter 4)

Public Health Services. South Australian Recycled Water Guidelines

National Water Quality Management Strategy guidelines for water recycling: managing health and environmental risks

Recycled Water In Australia

South Australian Reclaimed Water Guidelines

Further InformationFor further information please contact

Jim Kelly Arris Pty Ltd (08) 8313 6709

Table 1. Recycled water quality, respective potential uses and the required irrigation application method. Class A will be the class of water that would be supplied through the NAIS system to customers (modified from: South Australian Reclaimed Water Guidelines)

Recl

aim

ed W

ater

Cla

ss

Treatment Processes

Agricultural Uses

Crop grown on or near the ground eaten raw

Root crops eaten raw

Crops without ground contact

Crops without ground contact

and with a skin that

is removed before eating

Crops with ground

contact and skin that

is removed before eating

Root crops processed

before eating

Surface crops

processed before eating

Crops not for human

consumption/ silviculture, turf growing

Irrigation of

pasture and

fodder for dairy animals

Irrigation of

pasture and

fodder for non-dairy animals

A

Primary & full secondary

plus tertiary filtration plus disinfection

Spray, flood, drip, furrow, subsurface

Spray, drip, flood, furrow, subsurface

Spray, drip2, flood2,

furrow2, subsurface

Spray3, flood2, drip,

furrow, subsurface

Spray3, drip3, flood3,

furrow3, subsurface

Spray, drip, flood,

furrow, subsurface

Spray, drip, flood,

furrow, subsurface

Any Any Any

B

Primary & full secondary

plus disinfection

Drip, furrow, subsurface Subsurface1

Flood2, drip2,

furrow2, subsurface

Spray3, flood2, drip,

furrow, subsurface

Spray3, drip3, flood3,

furrow3, subsurface

Spray, drip, flood,

furrow, subsurface

Spray, drip, flood,

furrow, subsurface

Any Any6 Any7

C

Primary & secondary treatment or primary treatment

with lagoon detention

Subsurface Drip2,

furrow2, subsurface

Flood2, drip, furrow,

subsurface

Drip3, flood3, furrow3,

subsurface

Spray, drip, flood,

furrow, subsurface

Spray, drip, flood,

furrow, subsurface

Any Any6 Any7

D

Primary sedimentation plus lagooning

or full secondary

Subsurface Drip, furrow, subsurface Subsurface Subsurface Any4

1Crop surface dry at harvest2Dropped produce should not be harvested3Produce should not be wet from irrigation with reclaimed water when harvested4Withholding period of 4 hours of until ground dry before public access5Witholding period of 4 hours before pasture used for dairy animals; alternatively dry or ensile fodder before use6Withholding period of 5 days before pasture used for dairy animals; alternatively dry or ensile fodder before use7 Witholding period of 4 hours before pasture used for non-dairy animals; alternatively dry or ensile fodder before usereclaimed water of this quality will generally not be acceptable under SA Guidelines.



Arris Pty Ltd ABN 91 092 739 574

South Australian Office: The Waite Campus Bld 11b Gate 2c Hartley Grove URRBRAE SA 5064 Australia Tel +61 8 8313 6706 Fax +61 8 8313 6752

Queensland Office: 44 Wentworth Terrace ROCKHAMPTON, Qld 7400 Australia Tel +61 407 268 069 Fax +61 8 8313 6752

[email protected]

www.arris.com.au

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