Allocating Melbourne’s water resources

Water is essential to our way of life. As caretakers for Melbourne’s water cycle, we care for water, life and land throughout Melbourne: both its  people and its biodiversity.

In Victoria, these rights to water are defined through a water entitlement framework. Find out what we look at to determine the amount of water available and how it should be shared.

What’s a water entitlement?

A water entitlement is a legal right to take and store a certain portion of water, up to a maximum volume, depending on certain conditions. They are granted by the Minister for Water under the Water Act 1989.

Environmental water release at Starvation Creek
Environmental water release at Starvation Creek

Different entitlements are needed depending on where and how water is taken. Examples of what they are used for include:

  • Environmental entitlements, held by the Victorian Environmental Water Holder and used to improve health of waterway and groundwater ecosystems.
  • Water licences, held by individuals such as farmers, which entitle them to take and use water from a waterway, catchment dam, spring, soak or aquifer to irrigate a specific parcel of land. Each licence specifies conditions that are set by the Minister for Water.
  • Bulk entitlements, held by water authorities, such as Melbourne Water and Melbourne’s retail water corporations, on behalf of consumers.

How water is allocated 

Sugarloaf Reservoir, which supplies Melbourne’s northern, western and central suburbs.
Sugarloaf Reservoir, which supplies Melbourne’s northern, western and central suburbs.

Melbourne Water is resource manager for Melbourne’s water supply system: the Thomson, Yarra, Tarago and Bunyip rivers, and Silver and Wallaby creeks (otherwise known as the Greater Yarra System – Thomson River Pool).

Throughout the year we distribute water between entitlement holders, who receive a percentage of their entitlement volume to use based on current seasonal conditions. This percentage is known as the seasonal determination.

We calculate this at the start of each month, factoring in the volume of water in storages and commitments – including:

  • water for the environment (environmental entitlements)
  • the actual water volume in the water corporations’ accounts (including allocations already made in the current year, and water allocated but not used in previous years)
  • losses from water storages and the water transfer system

The seasonal determination is updated throughout the financial year as water continues to be allocated, and is expected to increase each month.

Seasonal determination: 1 April 2024

The 2023/24 seasonal determination for Greater Yarra System – Thomson River Pool is 83.9% (1 April 2024).

The next updated determination will be announced in May 2024.

For long-term water security, Melbourne retailers hold considerable quantities in reserve including unused water allocated in previous years.

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