Cherie Sivignon
February is shaping up to be a key month for the proposed $82.5 million Waimea dam, near Nelson, as an expected May date nears for a go/no-go decision.
Tasman District Council and dam proponent Waimea Irrigators Ltd (WIL) are proposed jointventure partners in the project, which is tipped to be funded by a mix of ratepayer, irrigator and Crown funding.
The proposed 53 metre concrete-faced rockfill structure in the Lee Valley has carved a chasm through the Tasman district community. People with strong views for and against the longproposed project stand on either side of that divide.
More than 1500 people expressed their opinions via submissions to a TDC consultation document about governance and funding options for the project. Many followed up with oral submissions during a hearing over four days in December.
The hearing panel, made up of the full council, is due to deliberate over those submissions next Thursday and Friday in scheduled full-day sessions that will be open to the public. A panel of technical and legal experts are expected to be present to answer any questions councillors may have.
A week later, on February 8, WIL is set to release its product disclosure document as it aims to raise $15 million via the sale of shares to irrigators.
Then, on February 27, Nelson City Council is due to deliberate over public submissions it received in response to a proposal it contribute $5m towards the project.
Outstanding information
Public consultation is one of three key outstanding matters related to the project that need to be resolved before TDC makes a final go or nogo decision on the dam. The others are the $15m of capital raising by WIL and a build price for the dam.
A joint venture of Fulton Hogan and Taylors Contracting has been appointed as the preferred contractor to enter an early contractor involvement process, which brings together the client, designer and contractor to complete the final design and price for the dam. That build price is not expected before April or May.
Until now, TDC has been working on an estimated construction price of $50m with another $13.5m contingency for changes in scope and unexpected costs. A final build price much above that could scupper the project.
Long road
The initial proposal for a dam came out of the Waimea Water Augmentation Committee (WWAC), set up after the Waimea River effectively ran dry in the drought of 2000-01 and the council proposed a plan change to set a minimum flow for the river.
WWAChad representatives from TDC, Nelson City Council, Fish & Game, Department of Conservation, iwi and irrigator interests on the Waimea Plains.
Consent was granted for the dam and the plan change set a minimum flow in the river of 1100 litres a second if the dam is built or 800l/s if it is does not go ahead.
That plan change brings with it some potentially huge consequences for urban water users as well as irrigators on the plains. In dry summers, if there’s no augmentation of the river, tougher water restrictions will kick in to meet the 800l/s minimum flow requirement, from November at the latest.
At first, it seems straightforward. Representatives from a range of organisations and groups decided collectively that a dam was the best option. That proposal then went through a public consent process and was approved. Straightforward, right? Wrong. It has been anything but and, as is often the case, the devil is in the detail, particularly the financial nuts and bolts – who should pay for what.
It’s the year of the Waimea dam decision. delves into the murky waters of the controversial project.
For and against
Key arguments for the proposed Waimea dam:
* It is a long-term solution that proponents say will meet the district’s rural and urban water needs for 100 years.
* The higher minimum flow of 1100l/s under the with-dam scenario is tipped to meet the obligations of the Government’s National Policy Statement for Freshwater Management. Some concern has been raise that 800l/s might not be enough.
* Likely Government funding towards the dam including a $7m grant from the Freshwater Improvement Fund, an interestfree loan of $10m and other concessionary loans via Crown Irrigation Investments Ltd may be lost if the project does not proceed.
* A TDC review finds alternative schemes to augment the urban water supply are more expensive than the dam.
Key arguments against the proposed dam:
* Cost and its apportionment. A final price has not been determined and the proposed funding model leaves ratepayers responsible for half of the first $3m of any cost overruns and all budget overshoots above that. Under the funding model, ratepayers will also underwrite up to $29m to cover a likely Crown Irrigation Investments loan on behalf of WIL.
* Many people, including some irrigators on the plains, question the need for a dam of the proposed size. It will be built with a lot of spare capacity and the water it stores may not always be needed. They liken it to an expensive insurance policy and argue other methods, such as urban rainwater tanks, could help alleviate any shortage during dry periods.
The project also carries some hefty political baggage. Many submitters say they believe the council was given a clear ‘‘no dam’’ message during public consultation in 2014. There were also conflict of interest claims made against mayor Richard Kempthorne and Cr Kit Maling. The Office of the Auditor-General cleared both.