Drought and climate change are driving high water prices in the Murray-Darling Basin

Neal Hughes, Australian Bureau of Agricultural and Resource Economics and Sciences (ABARES)

Water prices in the southern Murray-Darling Basin have reached their highest levels since the worst of the Millennium drought more than a decade ago. These high water prices are causing much anxiety in the region, and have led the federal government to call on the Australian Competition and Consumer Commission to hold an inquiry into the water market.

Inevitably, whenever an important good becomes more expensive – be it housing, electricity or water – there is a rush to identify potential causes and culprits. In the past few years high water prices have been blamed on foreign investors, corporate speculators, state government water-sharing rules, new almond plantings and the Murray-Darling Basin Plan.

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Read more:
The Murray-Darling Basin scandal: economists have seen it coming for decades

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While some of these factors have had an effect on the market, they are in many ways a distraction from the simpler truth: that high water prices have mostly been caused by a lack of rain.

Supply drives the market

The waters of the northern basin run to the Darling River and the waters of the southern basin run to the Murray River.
MDBA

Market reforms in the 1980s and 1990s enabled water trading in many parts of Australia. By far the most active market exists in the southern Murray-Darling basin, which covers the Murray River and its tributaries in northern Victoria, southern New South Wales and eastern South Australia.

The market allows users – mostly irrigation farmers – to trade their water allocations (effectively shares of water in the rivers’ major dams). This trading helps ensure limited water supplies go to the farmers who value them the most, which can be crucial in times of drought.

Historical data shows the main driver of water market prices in the southern basin is change in water supply.

The following chart shows storage volumes (in orange) and water prices (in red) in the southern basin since 2006. Prices peaked at the height of the Millennium drought in 2007. During the floods of 2011, they fell near zero. Prices have increased again during the latest drought, and are now at their highest levels in a decade.

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Water allocation prices and storage volumes in the southern Murray-Darling Basin.
State government trade registers, BOM, Ruralco Water, ABARES estimates.

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Lower rainfall, higher temperatures

While water prices have always been higher in dry years and lower in wet, we’ve been getting a lot more dry years in recent decades.

Over the past 20 years, rainfall, run-off and stream flow in the southern basin has been far less than historical conditions.

The below chart shows modelled flow data for the Murray River, assuming historical weather conditions and no water extraction, over the past century. It shows that average water flows this century are about 40% below the average of the 20th century.

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Modelled ‘without-development’ annual Murray River flow, 1900 to 2018.
Murray-Darling Basin Authority.

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We know these reductions are at least partly related to climate change, driven by both reduced winter rainfall and higher temperatures.

Lower rainfall and higher temperatures also make crops thirstier, increasing demand for irrigation water. This was evident in January, when temperatures exceeded 35℃ for 14 days and irrigators’ demand for water spiked from about 4.5 gigalitres to 7 gigalitres a day.

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Read more:
Droughts, extreme weather and empowered consumers mean tough choices for farmers

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The basin plan in perspective

The Murray-Darling Basin Plan seeks to improve the environmental health of the river system by recovering water rights from irrigation farmers. To date, more than 1,700 gigalitres of water rights – about 20% of annual water supply – have been recovered in the southern basin.

By reducing supply, water recovery was always expected to increase water prices. However, the effects of water recovery on supply – while significant – are still small relative to the effects of climate over the same period, as shown in the below chart.

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Water allocation use in the southern basin with and without water recovery.
State government agencies, Department of Agriculture, ABARES estimates.

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Measuring the precise effect of water recovery on prices is difficult. Water buybacks are straightforward and have been modelled by ABARES and others. But the effects of infrastructure programs – where farmers return a portion of their water rights in exchange for funding to upgrade infrastructure – are harder to estimate.

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Read more:
Billions spent on Murray-Darling water infrastructure: here’s the result

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‘Carryover’ rule changes

Historically farmers had to use water allocations within a 12-month window. The introduction of “carryover” – most recently in Victoria in 2008 – means users can now hold their unused water in dams. This rule change was a good thing, as it encourages farmers to conserve water and build up a buffer against drought.

But it might also have contributed to anxiety about the water market’s operations.

Since water allocations can be bought and held for multiple years, information about future conditions can have a big effect on prices now. For example, we see large jumps in price following news of worse-than-expected supply forecasts. This may have helped fuel concern about “speculators”.

Over the longer-term, the ability to store water helps to “smooth” water prices, with slightly higher prices in most years offset by much lower prices in drought years. Again this is a good thing, but it may have added to the perception of higher prices in the market.

Water demand is rising

When a profitable new irrigation activity is willing to pay more for water – as is the case with almond farms in the southern basin – competition for limited supplies can potentially drive up prices.

ABARES’ research shows that between 2003 and 2016 there was little change in irrigation demand (aside from that linked to rainfall). Growth in demand from expanding activities such as almonds and cotton was offset by reductions in others including dairy, rice and wine grapes. However, there is evidence since 2016 that demand for water has started to increase, contributing to higher water prices. Longer-term projections suggest this trend may continue.

With drought and climate change reducing water supply, and demand for both environmental and irrigation water increasing, high water prices are only likely to become more common in the basin in future.

Neal Hughes, Senior Economist, Australian Bureau of Agricultural and Resource Economics and Sciences (ABARES)

This article is republished from The Conversation under a Creative Commons license. Read the original article.

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Australia’s native rhododendrons hide in the high mountain forests

Rhododendron lochiae, photographed on Bell Peak.
Image by Dan McLeod

Stuart Worboys, James Cook University

Sign up to the Beating Around the Bush newsletter here, and suggest a plant we should cover at batb@theconversation.edu.au.

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The 1800s was a time of colonial expansion across the globe. During this time the great and the good of Britain filled their grand gardens with exotic novelties from all corners of the world.

Amongst these were many species of Asian rhododendron, a diverse and colourful genus of shrubs and small trees, whose high altitude origins made them well suited to the cool temperate climate of England and Scotland.

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The road to here: rivers were the highways of Australia’s colonial history

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Throughout the 19th century, commercial collectors and field naturalists discovered rhododendron species in southern China, the Himalayas, on the high peaks of Borneo, Java and especially New Guinea.

These finds lead Victoria’s government botanist of the time, Ferdinand von Mueller, to speculate about finding rhododendrons on the high tropical mountains on the northeast coast of Queensland. He wrote:

When in 1855 [I] saw… the bold outlines of Mount Bellenden-Ker, the highest mount of tropical Australia, towering to 5,000 feet, [I] was led to think, that the upper region might prove to be the home of species of Rhododendron… forms of plants characteristic of cool Malayan sylvan regions.

But the lofty heights of Mt Bellenden Ker were unknown to European Australians. It would be another 32 years before an expedition led by naturalist W.A. Sayer reached its central peak.

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The Conversation, CC BY-ND

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Sayer’s expedition, accompanied by two indigenous assistants, reached the mountain’s high ridge after several mishap-filled attempts. It was here they confirmed Mueller’s suspicions. Sayer’s account of its discovery is interesting:

The top of the range is razor-backed, and on travelling along the range beyond the spur by which we ascended, I could not see the sides, they being, if anything, hanging over. We tumbled rocks over, but could not hear them fall.

It was here that I observed the Rhodendron Lochae growing, and asked the Kanaka to get it; but he remarked, ‘S’pose I fall, I no see daylight any more; I go bung altogether;’ so I had to get it myself.

Mueller received the hard-won specimens and named the species Rhododendron lochae (later corrected to R. lochiae) after Lady Loch, the wife of the Victorian Governor.

Since then, rhododendron plants have been found on nine peaks and tablelands in the Wet Tropics region of north Queensland. Populations on peaks south of Cairns are called Rhododendron lochiae, whilst plants growing on mountains to the north of Cairns are considered by some to be a distinct species: Rhododendron viriosum.

Australian rhododendron at Smith College Botanical Garden.
Ren Glover/Flickr, CC BY-NC

Both northern and southern plants are straggly shrubs that grow in thin soils or rock cracks, sometimes in open cloud-swept boulder fields, sometimes in deep shade along creeks, or rarely as epiphytes on moss-covered trees. They produce bunches of gloriously red, bell-shaped flowers, followed by dry brown capsules filled with small winged seeds that are apparently spread by wind.

They grow slowly but with relative ease from cuttings, and are often cultivated in gardens and nurseries in temperate Australia. However, over time knowledge of the precise origin of these cultivated plants has been lost, which means they are unsuitable for detailed scientific investigations.

All of Australia’s rhododendron populations are located at altitudes above 950m in National Parks within the Wet Tropics World Heritage Area. Most are difficult to access, requiring arduous climbs on rough foot tracks through leech-infested rainforest. And yet, although isolated in protected areas, they are threatened by human activities: loss of habitat due to climate change.

Recent climate modelling research published by scientists from James Cook University and the CSIRO predicts significant reductions in suitable habitat for a suite of mountaintop flora species in Australia’s tropics (our rhododendrons were not included in the analysis, but occupy the habitats assessed).

The habitat of many of these species is predicted to disappear altogether well before the end of the century.

Conservationists are racing to preserve samples of native rhododendrons.
Author provided

Using rhododendron as a model, the Australian Tropical Herbarium at James Cook University is working to save these threatened species through “ex situ” conservation – cultivation in temperate zone public gardens, well outside their natural range. Because the threatening process – climate change – is not readily mitigated, establishing precautionary ex situ collections is the only viable conservation intervention for these plants.

With funding from the Australian Rhododendron Society Victoria Branch and the Ian Potter Foundation, and the support of traditional owners, Queensland National Parks and the Wet Tropics Management Authority, we have mounted expeditions to collect samples from most of the known populations.

These expeditions have put expert naturalists into rarely visited and challenging environments. Beyond gathering rhododendron samples, new moss species have been discovered and are being named, a fern previously thought extinct was rediscovered, and beautiful little epiphytic orchids have been found on a mountain where they’d not previously been recorded. Golden bower-bird bowers have been mapped in remote mountain rainforests, and a likely new species of snail has been discovered.

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Australia now has a well-documented and genetically diverse collection of native rhododendron plants thriving in the Dandenong Ranges Botanic Garden.

We plan to expand this work, ensuring the preservation and public display of rhododendron and many other mountain species threatened by climate change.

Sign up to Beating Around the Bush, a series that profiles native plants: part gardening column, part dispatches from country, entirely Australian.

Stuart Worboys, Laboratory and Technical Support Officer, Australian Tropical Herbarium, James Cook University

This article is republished from The Conversation under a Creative Commons license. Read the original article.

Fossil fuel emissions hit record high after unexpected growth: Global Carbon Budget 2017

Pep Canadell, CSIRO; Corinne Le Quéré, University of East Anglia; Glen Peters, Center for International Climate and Environment Research – Oslo; Robbie Andrew, Center for International Climate and Environment Research – Oslo; Rob Jackson, Stanford University, and Vanessa Haverd, CSIRO

Global greenhouse emissions from fossil fuels and industry are on track to grow by 2% in 2017, reaching a new record high of 37 billion tonnes of carbon dioxide, according to the 2017 Global Carbon Budget, released today.

The rise follows a remarkable three-year period during which global CO₂ emissions barely grew, despite strong global economic growth.

But this year’s figures suggest that the keenly anticipated global peak in emissions – after which greenhouse emissions would ultimately begin to decline – has yet to arrive.

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Read more: Fossil fuel emissions have stalled: Global Carbon Budget 2016

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The Global Carbon Budget, now in its 12th year, brings together scientists and climate data from around the world to develop the most complete picture available of global greenhouse gas emissions.

In a series of three papers, the Global Carbon Project’s 2017 report card assesses changes in Earth’s sources and sinks of CO₂, both natural and human-induced. All excess CO₂ remaining in the atmosphere leads to global warming.

We believe society is unlikely to return to the high emissions growth rates of recent decades, given continued improvements in energy efficiency and rapid growth in low-carbon energies. Nevertheless, our results are a reminder that there is no room for complacency if we are to meet the goals of the Paris Agreement, which calls for temperatures to be stabilised at “well below 2℃ above pre-industrial levels”. This requires net zero global emissions soon after 2050.

After a brief plateau, 2017’s emissions are forecast to hit a new high.
Global Carbon Project, Author provided

National trends

The most significant factor in the resumption of global emissions growth is the projected 3.5% increase in China’s emissions. This is the result of higher energy demand, particularly from the industrial sector, along with a decline in hydro power use because of below-average rainfall. China’s coal consumption grew by 3%, while oil (5%) and gas (12%) continued rising. The 2017 growth may result from economic stimulus from the Chinese government, and may not continue in the years ahead.

The United States and Europe, the second and third top emitters, continued their decade-long decline in emissions, but at a reduced pace in 2017.

For the US, the slowdown comes from a decline in the use of natural gas because of higher prices, with the loss of its market share taken by renewables and to a lesser extent coal. Importantly, 2017 will be the first time in five years that US coal consumption is projected to rise slightly (by about 0.5%).

The EU has now had three years (including 2017) with little or no decline in emissions, as declines in coal consumption have been offset by growth in oil and gas.

Unexpectedly, India’s CO₂ emissions will grow only about 2% this year, compared with an average 6% per year over the past decade. This reduced growth rate is likely to be short-lived, as it was linked to reduced exports, lower consumer demand, and a temporary fall in currency circulation attributable to demonetisation late in 2016.

Trends for the biggest emitters, and everyone else.
Global Carbon Project, Author provided

Yet despite this year’s uptick, economies are now decarbonising with a momentum that was difficult to imagine just a decade ago. There are now 22 countries, for example, for which CO₂ emissions have declined over the past decade while their economies have continued to grow.

Concerns have been raised in the past about countries simply moving their emissions outside their borders. But since 2007, the total emissions outsourced by countries with emissions targets under the Kyoto Protocol (that is, developed countries, including the US) has declined.

This suggests that the downward trends in emissions of the past decade are driven by real changes to economies and energy systems, and not just to offshoring emissions.

Other countries, such as Russia, Mexico, Japan, and Australia have shown more recent signs of slowdowns, flat growth, and somewhat volatile emissions trajectories as they pursue a range of different climate and energy policies in recent years.

Still, the pressure is on. In 101 countries, representing 50% of global CO₂ emissions, emissions increased as economies grew. Many of these countries will be pursuing economic development for years to come.

Contrasting fortunes among some of the world’s biggest economies.
Nigel Hawtin/Future Earth Media Lab/Global Carbon Project, Author provided

A peek into the future

During the three-year emissions “plateau” – and specifically in 2015-16 – the accumulation of CO₂ in the atmosphere grew at a record high that had not previously been observed in the half-century for which measurements exist.

It is well known that during El Niño years such as 2015-16, when global temperatures are higher, the capacity of terrestrial ecosystems to take up CO₂ (the “land sink”) diminishes, and atmospheric CO₂ growth increases as a result.

The El Niño boosted temperatures by roughly a further 0.2℃. Combined with record high levels of fossil fuel emissions, the atmospheric CO₂ concentration grew at a record rate of nearly 3 parts per million per year.

This event illustrates the sensitivity of natural systems to global warming. Although a hot El Niño might not be the same as a sustained warmer climate, it nevertheless serves as a warning of the global warming in store, and underscores the importance of continuing to monitor changes in the Earth system.

The effect of the strong 2015-16 El Niño on the growth of atmospheric CO₂ can clearly be seen.
Nigel Hawtin/Future Earth Media Lab/Global Carbon Project, based on Peters et al., Nature Climate Change 2017, Author provided

No room for complacency

There is no doubt that progress has been made in decoupling economic activity from CO₂ emissions. A number of central and northern European countries and the US have shown how it is indeed possible to grow an economy while reducing emissions.

Other positive signs from our analysis include the 14% per year growth of global renewable energy (largely solar and wind) – albeit from a low base – and the fact that global coal consumption is still below its 2014 peak.

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Read more: World greenhouse gas levels made unprecedented leap in 2016

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These trends, and the resolute commitment of many countries to make the Paris Agreement a success, suggest that CO₂ emissions may not return to the high-growth rates experienced in the 2000s. However, an actual decline in global emissions might still be beyond our immediate reach, especially given projections for stronger economic growth in 2018.

To stabilise our climate at well below 2℃ of global warming, the elusive peak in global emissions needs to be reached as soon as possible, before quickly setting into motion the great decline in emissions needed to reach zero net emissions by around 2050.

Pep Canadell, CSIRO Scientist, and Executive Director of the Global Carbon Project, CSIRO; Corinne Le Quéré, Professor, Tyndall Centre for Climate Change Research, University of East Anglia; Glen Peters, Research Director, Center for International Climate and Environment Research – Oslo; Robbie Andrew, Senior Researcher, Center for International Climate and Environment Research – Oslo; Rob Jackson, Chair, Department of Earth System Science, and Chair of the Global Carbon Project, globalcarbonproject.org, Stanford University, and Vanessa Haverd, Senior research scientist, CSIRO

This article was originally published on The Conversation. Read the original article.

Brazil: New Ant Species Discovered

The link below is to an article reporting on the discovery of a new ant species found high in the trees of Brazil in bromeliads.

For more visit:
http://www.guardian.co.uk/science/2013/jul/21/new-to-nature-anochetus-hohenbergiae