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Victorian agriculture makes a significant contribution to Australia’s economy. Our irrigated agriculture was worth $5.24 billion in 2020-21. This represents 28% of Australia’s total irrigated agricultural production.

Irrigation in the state began in the second half of the 19th century and much of the infrastructure could not cope with the demands of modern irrigation and rural water users.

Victoria has approximately $2.9 billion of major water infrastructure projects recently completed or underway that will increase water security and improve drought resilience for our regional communities. Contributors to this work include:

  • the Victorian Government
  • the Commonwealth Government
  • water corporations.

Modernising rural water supply systems

Victoria has several rural water infrastructure projects aimed at improving the efficiency and productivity of existing irrigation districts and rural water supply systems. The construction phase involves upgrading or evolving components specific to each project while ensuring minimal environmental and rural economic impacts.

Modernising rural water supply systems may include:

  • automating and upgrading channels to reduce the need to operate the system manually while measuring water flows accurately and in real-time
  • removing redundant channels
  • replacing open channels with pipelines to minimise water losses
  • upgrading the accuracy of metered outlets that deliver water to farms
  • lining and remodelling channels to minimise water lost during transportation
  • building recycled water infrastructure to increase climate resilience
  • constructing water treatment systems like reverse osmosis to improve potable water quality

Combined with changes to how systems operate, these works improve service levels for rural water users and save billions of litres of water.

Picture of an irrigation system from the Goulburn-Murray Water connections project.
An irrigation system from the Goulburn-Murray Water connections project

Current water infrastructure projects

The Goulburn-Murray Water - Water Efficiency Project is delivering off-farm infrastructure works across the Goulburn Murray Irrigation District.

Lower Murray Water Sunraysia Water Efficiency Project

The $37.9 million Lower Murray Water Sunraysia Water Efficiency Project (SWEP) is funded by the Commonwealth Government under the Off-farm Efficiency Program.

The project builds on the success of previous Sunraysia modernisation projects to further support agricultural production, provide stimulus for the regional economy and the environment.

The project will upgrade and remove outdated water infrastructure in the Mildura, Red Cliffs and Merbein irrigation districts and will:

  • upgrade and line approximately 27 km of outdated irrigation channel
  • remove or upgrade up to 700 existing dethridge, stock and domestic meter outlets.

The project is estimated to achieve water savings of up to 2.5 GL from works completed. These water savings are subject to independent audit against the State’s protocols.

This is the first project under the Off-farm Efficiency Program to deliver not only water savings for the environment but also Traditional Owners and urban water security for Mallee Towns.

Construction commenced on the first stage of works in late-May 2023.

Macalister Irrigation District Modernisation Project

Southern Rural Water's (SRW) Macalister Irrigation District (MID) irrigation infrastructure was in poor-to-fair condition. SRW required significant capital investments to upgrade its supply infrastructure.

The MID is the largest irrigation district in southern Victoria and primarily made up of dairy farming. The district's irrigation infrastructure was mainly manually, with service levels restricting agricultural productivity. There were significant water losses through evaporation and seepage during water transport to customers.

Since 2013 projects have occurred across the district. This work fits within the broader MID2030 modernisation program addressing the issues facing the district.

Phase 1A was a $32 million project completed on 30 June 2017 on time and within budget. This was a 50% co-investment between the Victorian Government and SRW.

The project ultimately removed over 15 km of open channel and upgraded or abandoned more than 300 regulators and 200 outlets within the district.

The project was designed to:

  • increase water efficiency and reduce water losses by approximately 12,000 megalitres (ML)
  • increase the reliability of supply, allowing timely delivery of orders and consistent flow rates, providing flexibility to farm businesses
  • provide economic growth associated with on-farm and local processing
  • provide environmental benefits by reducing nutrient discharge into the Gippsland Lakes.

The Macalister Irrigation District Modernisation Project: Phase 1B was a $60 million investment jointly funded by:

  • the Victorian Government
  • Commonwealth Government
  • Southern Rural Water through customer contributions.

The project focused on upgrading the Southern Tinamba Supply Zone, including:

  • replacing the upper channel system with approximately 39 km of gravity pipeline
  • upgrading and automating 32 km of existing open channel
  • removing redundant outlets.

The Macalister Irrigation District Modernisation Project: Phase 2 is a $62.6 million investment funded by:

  • the Victorian Government ($10.43 million)
  • the Commonwealth Government ($31.3 million)
  • Southern Rural Water through customer contributions.

The MID Phase 2 Project commenced in 2020 and is working to modernise infrastructure that is 60 to 100 years old and presents a major constraint to water supply and contemporary farming practices.

The MID Phase 2 program of works includes the replacement of open channel systems with new pipelines and modernisation works which include the upgrade and automation of outlets.

The project is estimated to generate up to 10.3 GL in water savings, increasing system delivery efficiency and agricultural productivity, boosting the regional economy and improving the health of the Gippsland Lakes by reducing nutrient-run off.

Werribee Irrigation District Modernisation Project

Southern Rural Water’s Werribee Irrigation District (WID) is one of Victoria’s biggest producers of leafy vegetables.

Climate change has seen water security in the region decline over recent decades, negatively impacting productivity and the health of the Werribee River.

Significant losses through evaporation and seepage also contribute to water security issues, as water is transported to irrigators through old, earthen channels.

The WID Stages 1-3 Project was a $19.98 million project funded by:

  • the Victorian Government ($9.54 million)
  • Southern Rural Water.

Stages 1-3 reached practical completion in June 2020 and achieved:

  • the modernisation of approximately 23km of pipeline
  • the upgrade of over 130 outlets.

The project is expected to achieve estimated water savings of 3.7 GL from works completed. These water savings are subject to independent audit against the state’s protocols.

The WID Stages 4-5 Project is a $21.95 million project funded by:

  • the Commonwealth Government via the National Water Grid Fund ($10.975 million)
  • Southern Rural Water.

The project will largely complete modernisation in the Werribee Irrigation District though the replacement of approximately 16.2 km of the inefficient channel-based irrigation network with new pipeline, and the installation of automated outlets to reduce water losses and improve reliability.

The project is expected to achieve estimated water savings of 1350 ML (including a recycled water component) from works completed. These water savings are subject to independent audit against the state’s protocols.

Recycled Water on the Bellarine

An $14.3 million project funded by:

  • Barwon Water ($6.8 million)
  • the Commonwealth Government ($5.5 million)
  • Victorian Government ($1.9 million).

The Recycled Water on the Bellarine project will upgrade an existing water reclamation plant by installing an ultra-filtration and reverse osmosis plant to improve quality and volume of supply.

The project will ensure secure, predictable water supplies now and in the future. The project will improve the quality and increase the volume of recycled water to Class B. This includes upgrading the Portarlington Water Reclamation Plant.

Quality Water for Wannon

A $52 million project announced in the 2023/2024 Federal budget funded by:

  • Wannon Water ($26 million)
  • the Commonwealth Government ($26 million).

The project will build new water treatment infrastructure to improve the potable water quality for the towns of Portland, Heywood and Port Fairy.

The new infrastructure will consist of three reverse osmosis treatment and fluoridation plants that will fundamentally enhance the climate-resilience and quality of life for the three outer regional communities. Broader benefits targeted include improved public health through providing fit-for-purpose drinking water quality leading to reduced obesity and related disease burden, dental health and reduction in plastic waste.

Completed water infrastructure projects

The $29 million Mitiamo Pipeline Project constructed a pipeline and stock and domestic scheme to supply 75,000 hectares south-west of Echuca near the townships of Mitiamo, Tennyson and Dingee. The project was funded by:

  • the Victorian Government ($10.2 million)
  • the Federal Government ($14.5 million)
  • Goulburn Murray Water ($4.3 million).

The project addressed significant water security and water quality issues with the construction of the new pipeline and supply scheme to reduce water losses by 1 GL per annum.

Completed in 2020, the South West Loddon Rural Water Supply Project delivered a 1,065 km pipeline to secure a reticulated water supply.

The project has significantly improved water quality to more than 1,500 rural properties across 2900 km2 surrounding Inglewood, Newbridge, St Arnaud and Wedderburn.

The project also expanded the Victorian water grid by providing an interconnection between the Wimmera-Glenelg and Goulburn system. Funding of the project came from:

  • the Victorian Government ($40 million)
  • the Commonwealth Government ($20 million)
  • Grampians Wimmera Mallee Water through customer contributions.

The project included a memorandum of understanding between Grampians Wimmera Mallee Water and the Traditional Owners, the Dja Dja Wurrung Clans. This is an excellent example of the government working alongside Traditional Owners to understand better and respect Aboriginal water values.

The Connections Project was the Victorian Government's largest irrigation infrastructure project. It delivered works to recover 433 gigalitres (GL) long-term water savings to benefit irrigators, the environment, and traditional owners.

The $2 billion project was vital to Victoria's contribution to implementing the Murray-Darling Basin Plan by providing 204 GL water savings. This contribution was achieved with no socio-economic impact on the region that results from water buy-backs.

The region's water irrigators benefit from a world-class automated water delivery system that drives improved productivity and greater water security.

The water recovery savings were distributed as follows:

  • irrigators (77 GL)
  • Melbourne retailers (75 GL as contracted and funded)
  • the environment (279 GL).

The additional water recovered also enabled 1.36 GL to be provided to Traditional Owners of the district.

The $120 million Sunraysia Modernisation Project has created a more efficient irrigation network across the Mildura, Merbein and Red Cliffs districts. The project has:

  • upgraded key pump stations across the three districts
  • replaced approximately 24 km of open channels with pipeline
  • installed channel automation in the remaining 20km of open channels, including 19 regulating structures.

The Commonwealth Government contributed $103 million towards the Sunraysia Modernisation Project, which Lower Murray Water delivered.

Benefits of the project include:

  • 365-day access to irrigation water via the water ordering system for over 2,000 customers, providing greater reliability and water availability
  • improved water quality and reducing on-farm filtration costs
  • greater operational flexibility and improving service delivery to irrigation customers
  • 7 GL in water savings transferred to the environment to bridge the gap under the Murray-Darling Basin Plan.

The Sunraysia Modernisation Project 2 used existing infrastructure and capacity to create opportunities for the Merbein and Red Cliffs irrigation districts.

The $7.8 million project supplied additional water and unlocked 2,000 hectares of additional land for irrigation.

The Bacchus Marsh irrigation district is a significant producer of:

  • stone and pome fruit
  • leafy vegetables
  • turf.

Climate change has seen water security in the region decline over recent decades, impacting productivity in the district and the health of the Werribee River. Significant losses through evaporation and seepage also contribute to water security issues as water is transported to irrigators through old earthen channels.

Rapid population growth at Bacchus Marsh has increased transport pressures and traffic congestion within the township, which has been exacerbated by the main water channel running through the town centre.

The modernisation project reached practical completion in June 2020 and involved the following:

  • the construction of approximately 8.5 km of pipeline
  • the upgrading of 29 outlets
  • installing a storage tank and decommissioning 2.4 km of channels in the irrigation district.

The $9.9 million project was funded with equal contributions from the Victorian Government and Southern Rural Water. The project saved an estimated 1 GL through the modernisation of channels.

Expanding the grid

Victoria’s water grid moves captured and stored water to places that require it. Investing in projects to expand the water grid increases water security for rural communities, especially in drier periods.

Victoria has several projects that help support rural communities by increasing water security.

The East Grampians Rural Pipeline Project was an $85.4 million project funded by:

  • the Victorian Government ($32 million)
  • the Federal Government ($32 million)
  • Grampians Wimmera Mallee Water ($21.4 million).

The project constructed up to 1,600 km of pipeline networks, securing domestic and stock water supply, covering up to 330,000 hectares of land. The scheme services up to 1,500 rural farming properties with stock and domestic water.

The project improved the agricultural productivity and resilience of rural communities across the Ararat, Pyrenees and Northern Grampians shires in the face of climate change.

The project connected the region with a more reliable water supply with the connection.

Page last updated: 10/10/23