Irrigation Development Scheme

2. Processes

The processes of investigation, promotion and development of a communal irrigation scheme can be divided into three sectors:

Administration Processes

Engineering Processes

People Processes

The administration processes can be quite significant considering the need to communicate with a large number of potential stakeholders as well as the administration involved in the provision of funds and managing the study process.

2.1.1 The Role of the Promoter

The promoter of the scheme has three basic functions. They are to:

carry out the feasibility study into the physical viability of the scheme; educate and communicate at all stages through the feasibility process;
ensure the economic viability of the scheme is assessed throughout the process.

2.1.2 Project Management

Project management of feasibility studies can be a complicated and time-consuming activity. For the smooth operation of feasibility analysis, it is important that tight project management and time management skills are used. The role encompasses the need to co-ordinate the input from a number of professionals who will be involved in the investigation, as well as the necessary communication with the community of interest.

In many instances, an experienced professional person best carries out the project management role. They can then report progress and findings to a management committee who provide direction to the project manager and make decisions on how to proceed when necessary.

2.1.3 Ownership Options

In most instances, the promoter of the scheme will not be the eventual commercial owner of the scheme. This is generally put in the ownership of the beneficiaries of the scheme, with an appropriate governance structure. This governance structure must provide for management of the financial aspects of the capital development of the scheme as well as provide appropriate ongoing operating, repairs and maintenance, and any further possible scheme development.

Funding of schemes depends very much on the relative capital cost of the development per hectare of irrigation. Depending on the level of this capital cost, it will be able to determine an appropriate level of up-front capital contribution by beneficiaries or ongoing funding by debt at an appropriate and affordable level. This decision must be based on the relative economic benefits that can be attained by water users.

2.1.4 Flow-on Impacts

Recent studies into the potential economic impact of proposed irrigation schemes in Canterbury have identified that the potential flow-on impacts past the farm gate are greater than those able to be achieved on-farm. The flow-on impacts achieved are in the form of employment, increased regional output and increased regional value added. The multiplier effect of flow-on impacts means that the community at large is a significant economic beneficiary from the development of irrigation schemes. This is primarily as a result of the intensification and change of land use that occurs under irrigation.

2.2 Engineering Processes

Engineering processes are primarily governed by potential water supply options, potential demand requirements and the interests of other stakeholders in water resources.

2.2.1 Supply Studies

Engineering supply studies are primarily concentrated on the feasibility of the diversion, storage and delivery of water from the water source to the farm gate. Depending on the nature of the potential water supply or the size of storage and delivery requirements, these can be quite detailed and quite expensive. Therefore, it is becoming increasingly common to at least stage these studies into a pre-feasibility study and then a full feasibility investigation. Even then, it is possible to have various phases of a feasibility study where there are multiple options which provide for decision-making as to whether to proceed or preferred options during the feasibility study process. These decisions are primarily based on the physical feasibility of delivery of water.

2.2.2 Demand Calculations

Different potential land uses have different levels of water consumption and different timing requirements for the delivery of that water. Therefore, some analysis needs to be made early in the planning process as to the potential or possible land uses in the study area and therefore the potential water demand. History has shown that a vital element in the water demand calculation is the reliability of water supply. As irrigation has moved away from being a drought insurance tool to a productive necessity, the volume and reliability of water supply have become very important. Current experience shows that a water supply reliability of up to 98% is required to justify the very high capital investment required of some new farming systems.

It is also recognised that there is a need to fully explore potential future land uses and their water demands so as not to preclude any future options for landowners. As an example, the current high water demands of dairy farmers have put pressure on old irrigation schemes that were designed to provide less volume and less reliable water supplies as required by traditional sheep farming options.

2.2.3 Conflicts of Use

The importance of identifying all people with a potential interest in the water resource and including them in the planning process has been well documented. These include recreational, environmental and cultural groups of interest. The ability to be able to accommodate all conflicts early in the process has been proven to be an important part of the successful development of a scheme.

2.2.4 Resource Consent Process

All schemes will need to go through the resource consent process before they can become reality. This is both an expensive and time-consuming activity. Therefore, an important part of the engineering process is the identification of any issues that would have a significant impact on the likelihood of success in the consent application process. These include the necessity to work within current or future regional water plans as well as the ability to adopt a balanced approach to water use with provision of as wide a range of benefits as possible incorporated into the design of the scheme.

2.3 People Processes

The very important lesson learnt from the last 80 years of irrigation development in New Zealand has been the importance of the inclusion of information on all aspects of a project as early as possible in the decision-making process. This is vitally important in schemes where farmers will be required to commit to the uptake of water and therefore the increased investment required in both off- and on-farm irrigation development. Recent feasibility studies have shown that in many cases, the on-farm costs of irrigation development and intensification of land use are significantly higher than off-farm scheme costs involved in the delivery of water. This means that irrigators are required to commit to a significant business investment decision. Like all businessmen, farmers require a certain amount of time and a great deal of information to help them with this decision. Therefore, the people processes involved in community irrigation schemes are strongly driven by the open and free provision of information.

During the feasibility or investigation phase of the project, this is most likely to be an iterative process, with communication and information flows to and from the community on a regular basis being an important element of both landholder decision-making as well as the decision-making processes of the promoter of the scheme.

There are a significant number of information requirements.

2.3.1 Land Use Options

Most irrigation development requires intensification of land use or complete land use change to justify the investment. Therefore, present landowners need to investigate the full range of land use options available to them and the likely costs and benefits from each of those land users. In this way, they will weigh up which best meets their requirements.

2.3.2 Irrigation Systems

There is a vast array of irrigation systems available to farmers. These vary hugely in their capital costs, labour requirements and water use and delivery characteristics. Therefore, there is a need for farmers to evaluate a wide range of irrigation system options, based not only on the land use which they propose to adopt, but also the technical operation characteristics of the irrigation scheme and the relative efficiency of delivery of water according to the proposed land use. These factors need to be traded off against the different capital costs and labour efficiencies of the various systems.

2.3.3 On-farm Economics

As already discussed, irrigation development and associated land use change may require capital investment ranging from $2,000/ha up to $13,500/ha for dairy farm development. A business investment decision of this magnitude will require detailed analysis by the landowner. Provision of a decision-making framework to assist individual on-farm decisions is an important part of the information flow.

History has shown us that there is a variable level of interest in the uptake of irrigation water in the farming community. This may have a huge impact on whether a scheme can proceed or not. Some schemes may require 100% commitment to uptake of water before the engineering works can proceed. Other schemes may be able to proceed with a lower level of uptake of farmers with some shares able to be taken up in the future as farms change hands and new farmers come on stream. The iterative process in community feedback is very important for promoters of the schemes to gauge the potential or likely uptake of water. This can have a huge impact on decisions whether to proceed further through the feasibility study process or not.

2.3.4 Development Processes

The harvesting and delivery of water to farm gates can be a complicated engineering process. Generally, it requires access through private farmland for delivery canals or pipes or even the flooding of farmland for water storage and dam facilities. Promoters of current schemes will have to negotiate with private landowners to use or gain access to their land. History shows that consultation as early as possible in the feasibility stages with affected landowners is an important aspect in gaining approval to do so.

2.3.5 Social Impact

Studies of the social impact on communities in which an irrigation development occurs show that there are wide-ranging changes. The economic and employment impacts of the intensification of land use have a wide-ranging impact on rural populations. Studies have shown that irrigation development has had the benefit of increasing rural populations, with a significant proportion of that increase being in either single workers or young families. This has a significant flow-on impact to community facilities such as sports clubs, schooling and provision of health facilities. It also has a big impact on the social make-up of the community, with a significant number of new immigrants changing the social balance. In many instances, this is the reversing of the current trend of rural depopulation and helps gain the support of a community for irrigation development schemes. The communication of these potential changes to the wider community is an important part of the process.