Question Time

Northern Adelaide Irrigation Scheme

The Hon. D.W. RIDGWAY (Leader of the Opposition) (14:24): I seek leave to make a brief explanation before asking the Minister for Sustainability, Environment and Conservation a question about the Northern Adelaide Irrigation Scheme.

Leave granted.

An honourable member interjecting:

The Hon. D.W. RIDGWAY: There's only one loser here, and you are opening your mouth now.

The PRESIDENT: Order!

The Hon. D.W. RIDGWAY: Mr President, can you protect me, please? It has been a long week. Because we are tired, I could say something I might regret.

The PRESIDENT: Protection is granted to the Leader of the Opposition.

The Hon. D.W. RIDGWAY: On 10 April this year, the state government announced a $110 million commitment from SA Water's future capital works budget for the Northern Adelaide Irrigation Scheme proposal, which would unlock 12 gigalitres from the Bolivar wastewater treatment plant. Interestingly, last year the minister announced a feasibility study into unlocking 20 gigalitres of water for this project. My question to the minister is: why was the project scaled back from 20 gigalitres to 12 gigalitres, and how will the 12 gigalitres be allocated?

The Hon. I.K. HUNTER (Minister for Sustainability, Environment and Conservation, Minister for Water and the River Murray, Minister for Climate Change) (14:26): I thank the honourable member for his most important question. The Northern Adelaide Irrigation Scheme is a fantastic opportunity to expand the use of recycled water for horticulture irrigation in the Northern Adelaide area. NAIS is PIRSA-led, Northern Adelaide Plains agribusiness initiative. I understand the industry would have access to this water to increase horticultural production and exports, transforming the region into a national leader in intensive, high-tech food production.

In August 2015, SA Water released an expression of interest process to the market for proposals to transport and make use of recycled water in a way that would generate the greatest economic benefit and jobs growth for South Australia. I understand there is very strong industry interest in purchasing recycled water through the Northern Adelaide Irrigation Scheme. While it is proposed that NAIS will have an initial capacity (now) of 12 gigalitres, there is a plan that NAIS will be built to enable 20 gigalitres capacity when future demand exceeds the initial supply.

An economic assessment has identified that 12 gigalitres of recycled water a year would create around 3,700 jobs, attracting about $1.1 billion in private investment and add, as the Hon. Mr Brokenshire says, a massive investment of $578 million a year to the state's economy. The NAIS would make good use of recycled water, creating positive outcomes for the environment, as well as the state's economy.

This is a point I made previously when I was asked this question is this place. I am not sure if it was asked by the Hon. Mr Ridgway, but another honourable member perhaps. This is subject to receiving a National Water Infrastructure Development Fund grant. The project will be funded through a mix of SA Water funds and up-front user contributions from NAIS customers. The honourable member may recall at the time that we were seeking a larger grant or contribution from the federal government out of a pool of money that is being allocated around the country for water associated projects.

I think I said previously in this place that it was intimated to us, from our connections in the federal government, that we would be unlikely to receive the full amount of moneys that we were searching for to enable the full 20-gigalitre process to be built in one go. Accordingly, tactically, we decided to increase the amount of investment on the part of SA Water and to reduce the amount of investment requested from the federal government. Rather than doing it, as I said, in one large go, we decided to do it in stages, with the capacity to expand at a later stage when demand indicates that that is going to be an efficient use of the resource.

The initial infrastructure will be constructed with the capacity to deliver 20 gigalitres. The first step is to bring the 12 gigalitres of recycled water for irrigation through NAIS to develop high-tech, high-value intensive horticulture north of the Gawler River. This enables time for export markets to develop as well. The revised proposal includes constructing infrastructure, as I said, to enable future expansion, to accommodate future demand for water and future growth in export markets.

I am aware that on 16 March 2017, Primary Industries and Regions submitted an expression of interest to the Australian government's National Water Infrastructure Development Fund for $45.6 million in funding to support the development of the infrastructure for the NAIS. As I said previously in this place, the remainder is to be funded by SA Water.

Essentially, it was to tailor our program to our intelligence about what may be forthcoming in terms of federal government grant funding. There was no point in asking for money about which it had been hinted that we would not be getting it, so we quite reasonably structured our ask to match what may be available from the federal government.