The consumption of groundwater from Victoria’s aquifers is managed according to geographical area. The principal management unit for groundwater in Victoria is the groundwater management unit (GMU), the boundaries of which often fall across more than one river basin. A GMU can be a Groundwater Management Area; Water Supply Protection Area; or Unincorporated Area.

A formal sharing agreement, the Groundwater Sharing Agreement, is in place between South Australia and Victoria where aquifers straddle the State borders.

In Victoria groundwater is managed through a range of actions:

• Licences are issued to protect the rights of licence holders; ensure that water is shared amongst users; and to ensure that environmental requirements are protected. To generate greater understanding about groundwater licensing for commercial purposes DSE has prepared the Groundwater Licensing and Trading Fact Sheet (PDF~229kb).
  
  
• Permissible consumptive volumes (PCVs) are caps that can be imposed to prevent the resource being depleted or adverse impacts such as declining groundwater levels, reduced base flows in rivers and streams, or changes to water quality. A PCV is a cap set by the Minister for Water and is the maximum volume of water that can be allocated in the area.
  
  PCVs are used in Groundwater Management Areas (GMA) and Water Supply Protection Areas (WSPA).  The declaration of a PCV for an area provides certainty as to the limits of groundwater available for extraction. Currently PCVs are set for GMAs and WSPAs but caps do not currently exist in Unincorporated  Areas. Many GMAs and WSPAs are already allocated to their PCV limit. In these areas new licences cannot be issued. The only way to acquire new water in these areas is to purchase a licence from an existing groundwater entitlement holder.
  
  
• Management plans and management rules can be used in WSPAs  and GMAs respectively, to manage groundwater resources equitably and sustainably where there is a risk to the resource.
  
  
• Monitoring and metering is used to track groundwater use. The water levels in approximately 2500 observation bores across the state are regularly monitored to assist with responsible management of groundwater resources for long term sustainability.
  

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