Changes to water abstraction rules linked to push towards greater sharing of water resources, says expert

The Department for Environment, Food and Rural Affairs (Defra) has set out proposals for a new "abstraction management system" (58-page / 636KB PDF) that it intends to implement from the early 2020s.

Under the changes, a new system of permits will restrict the volumes of water that can be abstracted to "at least reflect current business use", whilst abstractors' history of water use would be a factor in determining permitted volumes for abstraction in "dry years".

In addition, those that have licences to abstract water but do not use that water could see their licences revoked "if they pose a risk to the environment", Defra said.

The new regime will also see the scrapping of seasonal permits and enable abstractors to store water "when flows are high" to use at a later date when water levels drop. All abstraction licensees will face flow-based controls designed to protect the environment, while the system around the trading of water abstracted is to be modernised to allow for better sharing of available water into areas that need it. Trading could be subject to new codes of practice, the government said.

"Abstractors will be able to trade water in a quicker and easier way in catchments where there are potential benefits," Defra said. "In these catchments, there will be a range of preapproved trades, which means permit holders can trade more easily at times when the availability of water is low. In these catchments, surface water abstractors will be given shares of the catchment’s different water resources which will facilitate pre-approval of upstream trades. This will give abstractors more flexibility, helping them to cope during low flows and reveal the value of water to underpin decision-making."

Defra has separately opened a consultation, open until 8 April, on proposals (52-page / 894KB PDF) that would "end most exemptions from water abstraction licensing control and bring these abstractions into the licensing system".

Existing exemptions to licensing controls for activities such as irrigation and use of land drainage systems in reverse, as well as the abstraction of water into internal drainage districts and "abstractions within currently geographically exempt areas, including some rivers close to the borders of Scotland" will be scrapped, under the plans.

The move to make more water abstraction projects subject to licensing conditions is aimed at enabling more sustainable management of water resources, Defra said.

Water abstraction is currently controlled by a system of licences set up in the 1960s when water supplies were not considered to be as limited as they are now. Most abstractors generally obtain a licence to abstract a fixed amount of water, with allowed level of abstraction not linked to the availability of water in that area.

The government has expressed concerns about the existing system, including about its environment impact, and has said it can mean available water is not utilised or made available to those that need it, and that there is little incentive on abstractors to trade or use what water has been abstracted efficiently.

Environmental law expert Alison Messenger of Pinsent Masons, the law firm behind Out-Law.com, said that the proposals are designed to address the anticipated future challenge of water scarcity.

"Changing weather patterns mean that some areas will have less water in the future," Messenger said. "Others will see increased demand as the population grows. The government considers that the system needs to be more adaptable and allow effective sharing of water resources."

"Under reforms proposed, the amount of untreated water that individuals and businesses can extract from rivers and the ground is to be linked much more closely with the amount of water available, therefore bringing about major change to the way water abstraction is licensed. The current regulation of abstraction from rivers and groundwater is not flexible enough to cope with future challenges. The current regime is seen as costly, slow and bureaucratic, and not adequate for protecting the environment and for trading and sharing water resources," she said.

"The government proposes to introduce a new generation of licences and to make them more easily tradable," Messenger said. "The feedback from last year’s consultation has now been published and it confirms this shift towards linking abstraction licensing to the availability of water. The changes are proposed to take place from 2020 and will affect those companies that currently use abstraction licences or those that believe they may need one in the next few years. A new charging system is also proposed, which is likely to be consulted upon in the near future, with charges being higher for more reliable access to water."

Messenger said that companies with existing licences should note that they may be asked to look at abstracting from areas where water is more available, rather than their current source. She also warned licensees of other potential impacts of the proposed new regime.

"Licences could be amended to permitted volumes based on past use – over the last 10 years – but licence holders may be permitted to store water when flows are higher," Messenger said. "If your organisation has not been using its licence frequently then it is likely to be removed if it is deemed to pose a threat to the environment. Finally, there won’t be any compensation available following any changes made to your licences."