The Alberta Water Authority: should the idea sink or swim?

The Alberta Water Authority: should the idea sink or swim?

Last month the Report of the Premier’s Council for Economic Strategy Shaping Alberta’s Future outlined five “big” ideas to further provincial economic diversification and growth.   One of them is to create the Alberta Water Authority to “innovate in water stewardship, and realize the full benefit of our precious water assets”.   As with any such entity, the devil is in the details.  What else does the report say about the Authority?

The report characterizes the “first-in-time, first-in-right” (FITFIR) system as “out of sync with changing economic and demographic patterns”  and as lacking in flexibility to “respond to changing demand”.   (The FITFIR system operates to ensure that a senior (or historic) water user gets all their water pursuant to their licence prior to a junior or  more recent licence holder; a significant problem in times of water shortage.)

Further, the report notes,

We are not looking closely enough at the cumulative effects of our water use on groundwater, wetlands and the entire ecosystem.

I concur with the report on both points wholeheartedly.  However, the Report’s suggested resolution of these issues is far from sufficient from an environmental perspective.  The response to the out-dated FITFIR system is a Water Authority administered water exchange system and the enabling of short and long term leases for water use.  This idea of a water market, bank or exchange has been recurrent theme for some time now in water policy circles.  It is also highly contentious among the general public and groups with social and environmental concerns about how such a system would play out.

In espousing the exchange idea, without getting into greater detail, it is safe to assume that the big winners of such a system will be existing licence holders and those industries that are hungry for water (in a closed basin).  Tough social and environmental questions about a water exchange remain unanswered.  A more fundamental question also remains, if FITFIR is out of sync with reality, why preserve it through an exchange?  Market principles for a large list of goods and services are largely supported by society, whereas markets in water are far more contentious, for good social and environmental reason.

The report also does little to resolve concerns around cumulative effects.   We need to do more than just “look at” cumulative effects.  Increasing our knowledge and monitoring of water resources, as the report suggests, is required but this alone will not mitigate cumulative impacts of development, particularly in the context of our statutorily entrenched FITFIR system.

Also of note is the idea that the Water Authority would be funded “through a regulated levy on water allocation”.   This idea of a levy on water allocation could be beneficial in changing perceptions of licence holders by reinforcing and clarifying that the Crown, not the property owner, owns the water.  Then again this may be more than offset by how perceptions of water ownership may be driven by a full blown water exchange, where licencees treat the water as an owned commodity.  A levy, depending on the amount, may promote water conservation, but again, adverse consequences of a levy are not addressed.

The government doesn’t appear to be clamoring for an Authority but after repeated calls for a water exchange from differing water advisory groups one must wonder whether the groundwork for policy shifts around licence transfers is being set.   An Authority or Commission may be beneficial if it garners real powers to deal with cumulative effects and is properly resourced to monitor and manage those effects.  Properly empowered an authority could also administer a more dynamic and flexible water management system to facilitate continued economic growth in areas of the province where aquatic systems are already under stress.

So should the idea of the Alberta Water Authority sink or swim?  We may have to just wait and see how long it treads water.   It may be buoyed by economic arguments but may be overly weighed down by environmental and social costs.  Even if it does sink under those costs a stream of water users will likely be in line to resuscitate the idea.

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