Water banking in aquifers as a tool for drought resilience in the Murray Darling Basin

Water banking in aquifers is an internationally proven, low-cost solution that could improve drought resilience across the Murray Darling Basin. While significant potential for water banking through managed aquifer recharge (MAR) or conjunctive use of surface and groundwater resources has been identified in the Murray Darling Basin Plan, there is a need to establish clear policy and institutional foundations to incentivise adoption. To provide appropriate incentives for schemes, the legal status of rights to recharge, store and recover water, and the rules and costs which apply to groundwater extraction need to be clear and transparent. This paper aims to clarify principles and frameworks to secure water rights for recharge, storage, and recovery within the sustainable limits of water resources currently set under law. The current Basin Plan supports water banking, and banking would be complementary with objective and outcomes sought by future Basin Plans. Existing water accounting systems would need to accommodate this new capacity. Institutional arrangements and financial structures of water banking in the USA provide guidance for Australia. Demonstration sites would enable concurrent policy development and institutional set-up and provide critical experience to serve as models for wider adoption as part of future Murray Darling Basin plans.