CHB towns to have priority to dam

The Bay's towns such as Waipukurau (pictured) would have priority access over farmers to dam water under conditions being discussed.

Central Hawke's Bay townships will have priority access to Ruataniwha dam water - ahead of farmers - under an agreement being thrashed out between the scheme's promoter and CHB District Council.

The council is negotiating with the Hawke's Bay Regional Investment Company to take water from the proposed Ruataniwha storage scheme to boost urban reticulation supplies in Otane, Waipawa, Waipukurau and Takapau.

The $275 million scheme is designed to boost the local economy by providing up to 100 million cubic metres a year of irrigation water to drought-prone farmers and growers in Central Hawke's Bay.

The CHB council wants to take 2 million cubic metres a year from the scheme for town supplies in the four centres. That could increase to 4 million cubic metres a year if the district's population and economy boom as expected.

Current water supplies for residents and businesses in the four centres - pumped from either river or groundwater sources - are limited and will be stretched if the region experiences the population growth expected once the dam project goes ahead.

The council's finance and services committee last week endorsed a proposal to take town water from the scheme "subject to favourable contract terms" being negotiated with HBRIC, the investment arm of Hawke's Bay Regional Council.

At its annual meeting in Napier on Monday, HBRIC's board was asked how water supplies to CHB residents would be affected during a drought if the Ruataniwha scheme was unable to supply all water users.

HBRIC chairman Andy Pearce said the issue would be dealt with through the scheme's "concession deed" which would be amended to prioritise the delivery of water to town supplies ahead of irrigators.

"There are a series of priorities in that concession deed that have to be met, with environmental flows for example, being higher up than irrigation supplies," Dr Pearce said.

Under the deed, river flows in the local catchment would be increased, using the dam's water.

"We may need to tweak the concession deed so that quite a small fraction of the total volume that is going to town water supply is quite high up the priorities," he said.

HBRIC chief executive Andrew Newman has previously said the dam is on average expected to provide its 100 million cubic metre water capacity 19 years out of every 20.

HBRIC's commercial manager, Duncan MacLeod, said yesterday granting urban users priority access to water was not a concern that had been raised by potential irrigators, and it would not pose a problem given the low percentage of total available water the CHB District Council was considering taking from the scheme.

Asked at Monday's meeting about the price the CHB District Council would pay for its water, Dr Pearce said the council would not pay less than the group of irrigators HBRIC called its foundation water users - those who signed up to take water from day one of the scheme.

Mr Newman said the price: "will reflect the value to CHB District and the value to us - it will be a fair price".

Under the contract being negotiated between HBRIC and the council, the council would pay a per-cubic-metre price for water that HBRIC would deliver to pumping stations in the towns.

The council would pay for the water to be treated and circulated to homes and businesses.

Mr Newman said the proposal provided certainty of supply and price for the council. Under the concession deed, increases to the price of water delivered to the council and other foundation water users would be limited to changes in the consumer price index.