1 Name of Protocol
This Protocol is the Murray-Darling Basin Agreement (Schedule D — Calculating Cap Adjustments) Protocol 2010.
Note This Protocol deals with matters referred to in paragraph 6 (1) (a) of Schedule D to the Agreement.
2 Commencement
This Protocol commences on the day after it is registered.
3 Revocation
All previous protocols made under paragraph 6 (1) (a) of Schedule D to the Agreement are revoked.
4 Application
This Protocol applies to exchange rate trade and tagged trade.
5 Definitions
In this Protocol:
Act means the Water Act 2007.
Note Several other words and expressions used in this Protocol have the meaning given by the Act (including the Agreement), for example:
· Authority
· Contracting Government
· designated river valley
· year.
6 Cap transfer rates for transferred allocations — Table 1
For clause 2 of Appendix 3 to Schedule D to the Agreement, the following table is Table 1.
Table 1
| | | Designated valley to which water is transferred |
| Designated river valley from which water was transferred | # | 1 | 2 | 3 | 4 | 5 | 6* | 7 | 8 | 9 |
| NSW Murray | 1 | - | 1.0 | 1.0 | 1.0 | 1.0 | 1.0 | 1.0 | 1.0 | 1.0 |
| NSW Murrumbidgee | 2 | 1.0 | - | 1.0 | 1.0 | 1.0 | 1.0 | 1.0 | 1.0 | 1.0 |
| NSW Lower Darling | 3 | 1.0 | 1.0 | - | 1.0 | 1.0 | 1.0 | 1.0 | 1.0 | 1.0 |
| Victorian Murray/Kiewa/
Ovens | 4 | 1.0 | 1.0 | 1.0 | - | 1.0 | 1.0 | 1.0 | 1.0 | 1.0 |
| Victorian Goulburn/Broken/Loddon | 5 | 1.0 | 1.0 | 1.0 | 1.0 | - | 0.0 | 1.0 | 1.0 | 1.0 |
| Victorian Campaspe* | 6 | 1.0 | 1.0 | 1.0 | 1.0 | 0.0 | - | 1.0 | 1.0 | 1.0 |
| SA Country Towns | 7 | 1.0 | 1.0 | 1.0 | 1.0 | 1.0 | 1.0 | - | 1.0 | 1.0 |
| SA Lower Murray Swamps | 8 | 1.0 | 1.0 | 1.0 | 1.0 | 1.0 | 1.0 | 1.0 | - | 1.0 |
| SA Other | 9 | 1.0 | 1.0 | 1.0 | 1.0 | 1.0 | 1.0 | 1.0 | 1.0 | - |
Note * As allocations transferred to or from the Campaspe Valley are supplied through the Goulburn system, the Goulburn/Broken/Loddon annual diversion targets must be altered, rather than those for the Campaspe.
7 Cap transfer rates for entitlements transferred before 1 July 2007 — Table 2
For paragraph 5 (a) of Appendix 3 to Schedule D to the Agreement, the following table is Table 2.
Table 2
| | | Entitlement to which water was transferred |
| Entitlement from which water was transferred | # | 1 | 2 | 3 | 4 | 5 | 6 |
| NSW Murray High Security | 1 | - | 0.9 | 0.9 | - | - | - |
| Victorian Murray Water Right | 2 | 0.9 | - | 0.9 | - | 0.95* | - |
| SA Other: | 3 | | | | | | |
| (a) reduction in SA | | 0.90 | 0.90 | - | - | - | - |
| (b) increase in other valleys | | 0.81 | 0.81 | - | - | - | - |
| SA Lower Murray Swamps | 4 | - | - | 1.0 | - | - | - |
| Goulburn/Broken/Loddon Water Right + Sales** | 5 | - | 0.95 | - | - | - | 1.29 |
| Victorian Murray Water Right + Sales | 6 | - | - | - | - | 1.29* | - |
Note * Transfers from the Murray to the Goulburn System are only permitted as back trade.
Note ** As entitlements transferred to or from the Campapse Valley are supplied from the Goulburn System, the Goulburn/Broken/Loddon annual diversion targets must be altered, rather than those for the Campapse.
8 Cap factors
For paragraph 8 (c) of Appendix 3 to Schedule D to the Agreement, the following table is Table 3.
Table 3
| Type of entitlement | Cap factor (Cap/unit of entitlement) |
| NSW Murray High Security | not applicable |
| NSW Murray General Security | not applicable |
| Murrumbidgee High Security | not applicable |
| Murrumbidgee General Security | not applicable |
| VIC Murray Water Right + Sales | 1.1907 |
| VIC Murray Licence + Sales | 1.1258 |
| VIC Murray Water Right/Licence | 0.9500 |
| VIC Goulburn Water Right + Sales | 1.2960 |
| VIC Goulburn Licence + Sales | 1.1835 |
| SA Metropolitan Adelaide | not applicable |
| SA Country Towns | 1.0000 |
| SA Reclaimed Swamps | 1.0000 |
| SA All Other Purposes | 0.9000 |
9 Adjusting annual diversion targets — implementation of Stages
Implementation of Stage 1
(1) For subclause 9 (2) of Appendix 3 to Schedule D to the Agreement, Stage 1 is to be implemented in accordance with the following method statement.
Method statement
Step 1. The Authority must, pursuant to paragraph 8 (c) of Appendix 3 to Schedule D to the Agreement, determine the net increase in the cap required for each designated river valley by collating information for every type of entitlement set out in the Transfer Register in every year, from the effective date to the beginning of the year for which the adjustment is to be made.
Step 2. The Authority must first determine the Stage 1 valley adjustment for each designated river valley, in relation to every other designated river valley, by determining the lesser of:
(a) the increase in the cap required in one valley (Step 1); and
(b) the decrease in the cap required in the other valley (Step 1);
and then:
(c) adding the Stage 1 valley adjustment to the cap for the designated river valley mentioned in (a); and
(d) subtracting the Stage 1 valley adjustment from the cap for the designated river valley mentioned in (b).
Step 3. The Authority must calculate the total Stage 1 cap adjustment for each designated river valley by determining the sum of every Stage 1 valley adjustment (Step 2) calculated in relation to that designated river valley.
Step 4. The Authority must calculate the Stage 1 net cap deficit for transfers between a designated river valley and every other designated river valley by subtracting the Stage 1 valley adjustment (Step 2) for a designated river valley from the net increase in cap required for that designated river valley (Step 1).
Step 5. The Authority must determine the Stage 1 cap shortfall for transfers between a designated river valley and every other designated river valley, as:
(a) if the Stage 1 net cap deficit (Step 4) is greater than zero — the Stage 1 net cap deficit (Step 4); or
(b) otherwise — zero.
Step 6. The Authority must determine the Stage 1 cap surplus for transfers between a designated river valley and every other designated river valley, as:
(a) if the Stage 1 net cap deficit (Step 4) is less than zero the absolute value of the Stage 1 net cap deficit (Step 4); or
(b) otherwise — zero.
Step 7. The Authority must calculate the maximum cap commitment for each designated river valley, by determining the sum of every Stage 1 cap shortfall (Step 5) in each other designated river valley from which, or into which, transfers have been made to or from the first mentioned designated river valley.
Step 8. The Authority must calculate the interstate cap surplus for each designated river valley, by determining the sum of every Stage 1 cap surplus (Step 6) arising from transfers from, or into that valley, into or from designated river valleys in other States.
Implementation of Stage 2
(2) For subclause 9 (2) of Appendix 3 to Schedule D to the Agreement, Stage 2 is to be implemented in accordance with the following method statement.
Method statement
Step 9. The Authority must determine the entitlement conversion cap surplus with respect to each designated river valley, as:
(a) the absolute value of any decrease in the net cap required in that valley, as a result of conversions within that valley; or
(b) if the net cap required in that valley increases as a result of such conversion — zero.
Step 10. The Authority must calculate the total cap shortfall for a designated river valley, by determining the sum of every Stage 1 cap shortfall (Step 5) calculated in relation to that designated river valley.
Step 11. The Authority must calculate the total cap surplus for a designated river valley, by adding the following:
(a) the sum of every Stage 1 cap surplus (Step 6) calculated in relation to that designated river valley; and
(b) the entitlement conversion cap surplus (Step 9) calculated for that designated river valley.
Step 12. The Authority must calculate the shareable cap surplus for each designated river valley by determining the lesser of:
(a) the total cap surplus (Step 11); and
(b) the maximum cap commitment (Step 7);
for the designated river valley.
Step 13. The Authority must calculate the pooled cap surplus by determining the sum of shareable cap surpluses (Step 12) for all designated river valleys.
Step 14. The Authority must calculate the pooled cap shortfall, by determining the sum of the total cap shortfalls (Step 10) for all designated river valleys.
Step 15. The Authority must calculate the surplus ratio, by determining the lesser of:
(a) 1; and
(b) the pooled cap shortfall (Step 14) divided by the pooled cap surplus (Step 13).
Step 16. The Authority must calculate the shortfall ratio by determining the lesser of:
(a) 1; and
(b) the pooled cap surplus (Step 13) divided by the pooled cap shortfall (Step 14).
Step 17. The Authority must determine the total Stage 2 cap adjustment for each designated river valley by:
(a) multiplying the total cap shortfall for that valley (Step 10) by the shortfall ratio (Step 16); and
(b) multiplying the shareable cap surplus for that valley (Step 12) by the surplus ratio (Step 15); and
(c) subtracting the product of paragraph (b) from the product of paragraph (a).
Implementation of Stage 3
(3) For subclause 9 (2) of Appendix 3 to Schedule D to the Agreement, Stage 3 is to be implemented in accordance with the following method statement.
Method statement
Step 18. The Authority must calculate the Stage 2 cap surplus for each designated river valley, as the greater of:
(a) zero; and
(b) the result of subtracting the total cap shortfall (Step 10) from the aggregate of the total cap surplus (Step 12) and the Stage 2 cap adjustment (Step 17) for the valley.
Step 19. The Authority must calculate the total Stage 3 cap adjustment for each designated river valley, by multiplying the lesser of:
(a) the Stage 2 cap surplus (Step 18) for that valley; and
(b) the interstate cap surplus (Step 8) for that valley;
by –1 (minus one).
Implementation of Stage 4
(4) For subclause 9 (2) of Appendix 3 to Schedule D to the Agreement, Stage 4 is to be implemented in accordance with the following method statement.
Method statement
Step 20. The Authority must calculate the adjustment to each annual diversion target for each designated river valley by determining the sum of:
(a) the total Stage 1 cap adjustment (Step 3); and
(b) the total Stage 2 cap adjustment (Step 17); and
(c) the total Stage 3 cap adjustment (Step 19);
for the designated river valley.