Availability of water

IBISWorld forecasts the availability of water to contract by 1.2% during 2024-25, to 73.0 million megalitres. Water availability depends on rainfall running into rivers, lakes and groundwater aquifers. The annual rainfall level is projected to fall in the current year, placing downward pressure of the availability of water. Meanwhile, as of January 2025, the total water storage in the Murray-Darling Basin is 71% of the overall capacity. This represents a decrease relative to a comparative period in the prior year, where the total storage volume was 85%. The fall in storage volume is set to contribute to slumps in water availability in 2024-25.

Water availability has risen over the past five years. A key driver of increasing water availability has been a rise in annual rainfall, with rainfall levels over the six months through June 2022 being the highest since the same period in 2017. In addition, the Off-farm Efficiency Program replaced the Water Efficiency Program (WEP) in March 2021 and is a $1.54 billion program designed to invest in infrastructure and provide water for the environment. As of January 2025, there were five approved off-farm projects: Victoria's Goulburn Murray Water - Water Efficiency Project, the NSW Murrumbidgee Irrigation Automation Finalisation Project, the SA Marion Water Efficiency Project, the Lower Murray Water (LMW) Water Efficiency Project and NSW Nap Nap Station Water Efficiency Project. Implementing the new program has supported growth in water availability over the past five years.

Several Australian states have invested in desalination plants over the past decade to reduce their dependence on rain-fed water sources. Australia has six major desalination plants, the largest being the Victorian Desalination Plant, with an annual production capacity of 150.0 billion litres. At the same time, the Adelaide Desalination Plant and the Southern Seawater Desalination Plant in Western Australia can produce up to 100.0 billion litres annually. Water availability levels do not include desalination water. For this reason, the development of these desalination plants has limited increases in the availability of water over the past five years through reduced reliance on rain-fed water sources. Overall, IBISWorld forecasts the availability of water to rise at a compound annual rate of 1.7% over the five years through 2024-25.