Water Ledger, an Australian-grown project based out of Queensland, has launched its pilot project in the far north of their home state.
Built as a blockchain solution for the trading of water rights, the pilot project is being undertaken to evaluate blockchain’s potential to improve Australia's legacy, highly inefficient water markets.
Currently in Australia, trading in water rights and licences is a complex, slow and fairly opaque process. In New South Wales alone, more than 38,000 water licences are in circulation, but individual ownership is difficult to determine. While there is a central register of licence ownership, it is not free to access, and fees must be paid for every search. The ultimate effect is that finding out the owners of every water licences currently issued in NSW would cost approximately $558,600. The cost of searching registers throughout the country would be greater still.
The complexity extends to the kinds of licences that can be issued, and the rules around trading, transfer and ownership. CEO and co-founder of Water Ledger, Katrina Donaghy has commented that:-
The Water Ledger platform will completely transform the way irrigators trade temporary water allocations. A catalyst to driving innovation across water markets is to remove unnecessary complexities in how water allocations are traded. This means simplifying the process and providing greater clarity to stakeholders
RMIT researcher Harry Wetherall, who is considering the implications of blockchain for water trading, has previously commented that there is an obvious use case for a blockchain based system using smart contracts to improve these legacy systems, saying:
At the moment the quickest trades are taking place in a handful of days, but interstate trades, trades between zones or moving across industries, that can take up to nine weeks... So when you're making a trade you're trying to guess how much water you will need in the few weeks and it might rain an inch in that time.
Water Ledger has been developed and is owned by technology start up Civic Ledger. Joe Moro, Chairman of FNQ Growers, and a very influential irrigator said:
I'm very excited at the opportunity this gives our growers and look forward to seeing results over the coming months.
The CRCNA's CEO Jed Matz said:
The project team will work with stakeholders including irrigators to help them understand how blockchain and smart contracts work and how they may help them save money and improve their decision-making by allowing them to access near-real-time water trading information...We hope through accessing and using the technology platform, irrigators will provide feedback to help improve the technology and the adoption of Civic Ledger's Water Ledger platform.
This pilot project has been a while in the making. In May 2019, Civic Ledger submitted an EOI to the Cooperative Research Centre for Northern Australia (CRCNA) to undertake a trial pilot project Improving Water Markets and Trading through New Digital Technologies in the Mareeba-Dimbulah Water Supply Scheme (MDWSS) in Queensland. In early October 2019, the CRCNA advised Civic Ledger that it had been successful in its EOI, with the the pilot trial project initially scheduled to run from 28 January 2020 to 28 July 2020.