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Murray Irrigation Ltd - An example of irrigator autonomy Murray Irrigation Ltd - An example of irrigator autonomy Bill Hetherington, Chairman May 2005 INPIM Our location Murray Irrigation area of operations Murray Irrigation Limited area of operations New South Wales Victoria

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Murray Irrigation Ltd - An example of irrigator autonomy

Murray Irrigation Ltd - An example of irrigator autonomy

Bill Hetherington, Chairman

May 2005

INPIM

our location
Our location

Murray Irrigation area of operations

the region
The region
  • Area 748,000ha
  • 1.2million MLs/year (1,200 million m3)
  • $300 million farm gate production
  • 25,000 population
  • 2,400 properties
  • 1,600 farm businesses
self determination
Self determination
  • Late 70s early 80s irrigator dissatisfaction
  • 1987 Government established irrigator (farmer) advisory board
    • Irrigators involved in operation and management
  • 1989 Commercial arm of government established
  • 1995 over 700 irrigators votes for fully irrigator owned water supply company

Eighth International Seminar on PIM, Tarbes, France May 9-13, 2005

separation
Separation
  • Corporate structure & governance
  • Constitution – shares, water entitlements, voting
  • Financial viability – business planning
  • Staff structure
  • Legal - Relationship with government - Relationship with shareholders - Separation deeds – funding, infrastructure etc.
  • Taxation

Eighth International Seminar on PIM, Tarbes, France May 9-13, 2005

the compnay
The Compnay
  • Unlisted public company
  • Shareholders, farmers are customers“Like a co-operative”
  • Board elected by irrigators
    • Eight local directors (irrigators) from four geographic areas
    • Two external directors
    • Asset value $700 million ($393 structures, $307 earthworks)

Eighth International Seminar on PIM, Tarbes, France May 9-13, 2005

relationship with nsw government
Relationship with NSW Government
  • Water Management Works Licence
  • Water access licence – water sharing
  • Bulk water supply and pricing ($3 million)
  • Environment Protection Licence $24/ML (or 1,000m3) includes drainage
  • Funding deed for assets renewal Land Water Management Plan funding ($120M Gov. $380M landholders)
  • Integrated reporting and audit

Eighth International Seminar on PIM, Tarbes, France May 9-13, 2005

relationship with commonwealth government
Relationship with Commonwealth Government
  • Taxation
  • Funding for environmental initiatives
  • Inter-government agreements
    • Water reform, COAG, NWI
    • Water for the Snowy and Murray Rivers
    • Murray Darling Basin Agreement
  • Australian Competition and Consumer Council
  • Australian Securities & Investment Commission

Eighth International Seminar on PIM, Tarbes, France May 9-13, 2005

farmer participation
Farmer participation
  • Election of board members
    • 8/10 board members farmers
  • LWMP Working Groups
  • Focus group
  • R&D committee
communication
Communication
  • Weekly news sheet (fax and email)
  • Weekly radio program
  • LWMP newsletters
  • Annual magazine
  • Quality Accreditation –improvements register
  • Field days
  • Shareholder meetings
business viability
Business viability
  • Water price
    • Fixed charge ($9.25/ML or 1,000m3 + drainage)
    • Variable charge ($11.35/ML or 1,000m3 + drainage)
    • Includes asset maintenance & renewals contribution $1.55/ML and supply variation levy ($0.75/ML)
    • $22M since 1995 for future asset
    • Not for profit, water price set to break even

Eighth International Seminar on PIM, Tarbes, France May 9-13, 2005

efficiencies delivery
Efficiencies~ delivery
  • 3-5% improvement
  • 30,000-50,000ML saved a year30-50 million m3
  • 9,600ML perstaff member9.6 million m3
  • $24/ML or $24/1,000 m3 full cost recovery
efficiencies technology
Efficiencies ~ technology
  • Automation
  • Telemetry
  • Remoteoperations
  • Measuringlosses
  • Investment $1 million/year
slide16

Efficiencies ~ performance

  • Staff costs 26%
  • 40 hour week
  • Maintenance 90% in house, 10% contract
  • Capital 90% contract, 10% in house
slide17

Environment~ accountability

  • Operating licences
  • Accountable to shareholders,community and government
  • Monitoring and testing
  • 1.8ML/ha irrigation intensity1800m3/ha
  • Rice soil suitability
slide18

Land and Water Management Plans

  • $500 million
  • Started 1995
  • Shareholders involved
  • Government $59 million,shareholders $285 million to date
slide19

Salt interception

  • Wakool TullakoolSubsurface Drainage Scheme
  • Protects 50,000ha
  • 150,000-180,000tonnes of salt a year
innovation water exchange
Innovation ~ water exchange
  • First live 24hr exchange
  • 24 hour/ 7dayaccess
  • Water on farm same day (MIL)
  • 60,000ML(60 million m3) worth $12Msold in 2002/03
slide21

Innovation ~ hydro plant

  • Green power
  • On main supply channel
  • Supplies national power grid
slide22

Innovation ~aquaculture

  • Joint research project
  • Growing fish in saline groundwater
  • Commercial trials underway
slide23

Farm wetlands

  • Watering of stranded wetlands
  • Uses irrigation system to supply water
  • Partners are:NSW Wetlands Working group, MIL, landholders
  • Positive ecological response
business development
Businessdevelopment
  • Company focus traditionally on efficiency gains
  • Current business is a legacy from government
  • BDU charged with managing change
slide25

Innovation~ MILCast

  • Precast concrete products
  • Complementary business
  • Returns help tokeep down water price
current challenges
Current challenges
  • Opening up of trade
    • Financial viability of irrigation schemes
    • Local impacts
    • Environment a buyer
  • Modernisation of existing infrastructure
    • High cost
  • Attracting new investment
10 years on
10 years on
  • Independent and innovative
  • Representation of interests
  • Applied research and analysis
  • Positive input to public policy
  • Responsive to farmers needs
sound future
Sound future
  • Property right to water
    • Security for investment
  • Low salinity water 60EC (0.06 dS/m)
  • Diverse soils, temperate climate
  • Environment protected
  • Costs controlled
  • Technology providing advancements in service and efficiency

Eighth International Seminar on PIM, Tarbes, France May 9-13, 2005