Victorian agriculture makes a significant contribution to Australia's economy. Irrigated agriculture in Victoria was worth $4.9 billion in 2018-19 (ABS 2020), representing 30% of Australia's total irrigated agricultural production.

Irrigation commenced in Victoria in the latter half of the nineteenth century. Consequently, much of the original infrastructure is unable to cope with the demands of modern irrigation. Thousands of kilometres of channels and pipelines provide water to Victoria's irrigated agricultural industries.

Victoria currently manages $2.6 billion invested in water infrastructure projects to modernise irrigation systems and expand the water grid to increase rural communities' water security. This investment consists of contributions from the Victorian Government, Commonwealth Government and Water Corporations.

Modernising irrigation systems

Victoria has numerous rural water infrastructure projects that aim to improve existing irrigation districts' efficiency and productivity. The construction phase involves upgrading or evolving components specific to each project while ensuring the impacts on the environment are minimised.

Modernising irrigation 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, and
  • lining and remodelling channels to minimise water lost during transport.

In combination with changes to the way systems operate, these works will improve service levels to irrigators and save billions of litres of water.

Water infrastructure projects

These projects will help transform older irrigation infrastructure into modernised systems.

The $177.5 million GMW Water Efficiency Project delivers off-farm infrastructure works across the Goulburn Murray Irrigation District, including the modernisation or decommissioning of more than 250 km of channels and upgrading or rationalising more than 1,000 outlets, to improve service standards for approximately 1,000 customers.

This project will enable the creation of over 900 jobs during construction, reduce the ongoing asset financial liability, improve agricultural productivity and achieve environmental enhancements.

The project will recover 15.9 gigalitres (GL) long term average annual yield (LTAAY) of water savings as a Victorian contribution to a healthy Murray Darling Basin in a manner that does not impact the consumptive pool. The water savings are not taken from farmers but instead come from improved infrastructure, less leaky channels, and better water delivery automation.

The GMW Water Efficiency Project was announced in March 2021. It builds on the Connections Project's success, which finished in October 2020, by providing better levels of service to more farmers and rationalising some ageing parts of the irrigation system.

The Commonwealth Government commitment to fund the GMW Water Efficiency Project followed Victoria's positive socio-economic assessment of the project. The GMW Water Efficiency Project is funded by the Commonwealth Government and is expected to be completed in mid-2024.

More on the GMW Water Efficiency Project

Extensive detail on community engagement, socio-economic assessment, FAQs is available online at Engage Victoria. The GMW website also provides information on the project.

The Goulburn-Murray Water Connections Project is the Victorian Government's largest irrigation infrastructure project. It has already delivered works to recover 429 gigalitres of water savings to benefit irrigators and the environment. The Connections team is now in the process of winding down the completed project.

When completed, all water users in the region will benefit from a world-class automated water delivery system that will drive improved productivity, provide greater security for irrigators and produce real water savings.

The contracted water recovery from Stage 1 is to be distributed equitably between the irrigators, Melbourne retailers and the environment. The contracted water recovery for Stage 2 will be issued to the Commonwealth as part of Victoria's Murray-Darling Basin Plan water recovery targets.

The $2 billion project is a vital part of Victoria's contribution to implementing the Murray-Darling Basin Plan in a way that minimises any socio-economic impacts.

Southern Rural Water's (SRW) Macalister Irrigation District (MID) irrigation infrastructure was in moderately poor-to-fair condition and mostly behind industry best practice. SRW requires 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 operated mainly manually, with service levels restricting greater agricultural productivity. There were significant water losses through evaporation and seepage during the transport of water to customers.

Since 2013 projects have occurred across the district, which fit within the broader MID2030 modernisation program addressing the issues outlined above.

Phase 1A (complete)

The $32m Phase 1A project was completed on 30 June 2017 on time and within budget. This was a 50 per cent co-investment between each of the Victorian Government and SRW. The project ultimately removed over 15 kilometres of open channel and upgraded/abandoned more than 300 regulators and 200 outlets within the district. The project was designed to:

  • Increase water efficiency and reducing water losses by approximately 12,000 megalitres
  • Increase the reliability of supply, enabling timely delivery of orders and consistent flow rates and, in turn, providing flexibility to farm businesses
  • Provide economic growth associated with both on-farm and local processing
  • Provide environmental benefits by reducing nutrient discharge into the Gippsland Lakes.

For more information, visit the Macalister Irrigation District Modernisation Project - Phase 1A

Phase 1B (operationally complete)

The Macalister Irrigation District Modernisation Project: Phase 1B is a $60 million investment jointly funded by the Victorian Government, Commonwealth Government and 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 kilometres of gravity pipeline;
  • Upgrading and automating 32 kilometres of existing open channel; and
  • Removing redundant outlets.

For more information, visit the Macalister Irrigation District Modernisation Project - Phase 1B

Phase 2  (in progress)

The Macalister Irrigation District Modernisation Project: Phase 2 is a $62.6 million investment jointly funded by the Victorian Government ($10.43 million), Commonwealth Government ($31.3 million) and remaining from Southern Rural Water through customer contributions. MID Phase 2 will target infrastructure that are 60 to 100 years old and present a significant constraint to water supply and contemporary farming practices. MID Phase 2 is a program of works consisting of:

  • Piping the Newry subsystem;
  • Completing modernisation of remaining channel subsystems through a combination of piping and automation;
  • Undertaking channel, outlet and associated asset rationalisation and modernisation; and
  • Upgrading high use water outlets to modern, compliant outlets.

For more information, visit the Macalister Irrigation District Modernisation Project - Phase 2

Completed water infrastructure projects

Read more about completed irrigation modernisation projects in Victoria.

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 kilometres of open channels with pipeline; and
  • Installed channel automation in the remaining 20 kilometres of open channels, including 19 regulating structures.

The Commonwealth Government contributed $103 million towards the Sunraysia Modernisation Project, which Lower Murray Water delivered. The Assistant Minister officially opened the Sunraysia Modernisation Project to the Deputy Prime Minister, the Hon. Luke Hartsuyker MP on 21 September 2016.

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 leading to reduce on-farm filtration costs;
  • Greater operational flexibility to improve service delivery to irrigation customers; and
  • Seven gigalitres in water savings transferred to the environment to bridge the gap under the Murray-Darling Basin Plan.

For more information, visit the Sunraysia Modernisation Project.

The Sunraysia Modernisation Project 2 (SMP2) utilised existing infrastructure and capacity to create opportunities for the Merbein and Red Cliffs irrigation districts. The $7.8m project modernised 5.7km of open channel to supply additional water volumes and unlock 2,000 hectares of additional land for irrigation adjacent to the existing irrigation districts. Construction began in March 2019 and was completed in October 2019, one month ahead of schedule, and was ready for the 2019/20 irrigation season.

For more information on the Sunraysia Modernisation Project 2

The Werribee Irrigation District is one of Victoria’s biggest producers of leafy vegetables such as broccoli, lettuce and cauliflower. Climate change has seen water security in the region declined over recent decades, negatively impacting productivity within 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 (approximately) 50 kilometres of old, earthen channels.

The modernisation project reached practical completion in June 2020 and modernised channels, including approximately 23km of pipeline and the upgrade of over 130 outlets in the Werribee Irrigation District. The $19.98 million project was funded with equal contributions from the Victorian Government and Southern Rural Water, achieving an estimated 3. 700 gigalitres in water savings through the modernisation of channels. The project was completed to a reduced scope; however, there is continued effort to seek additional funding to complete Stages 4 and 5 of the original project design.

For more information, visit the Werribee Irrigation District Modernisation Project

The Bacchus Marsh Irrigation District is a significant producer of stone and pome fruit, leafy vegetables and turf. Climate change has seen water security in the region declined over recent decades, negatively impacting productivity within 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 construction of approximately 8.5km of pipeline, the upgrade of 29 outlets, installing a storage tank and decommissioning 2.4 km of channels in the Bacchus Marsh Irrigation District. The $9.9 million project was funded with equal contributions from the Victorian Government and Southern Rural Water, achieving an estimated one gigalitre in water savings through the modernisation of channels. The project was completed to a reduced scope, with stage 5 still outstanding; however, negotiations are underway to complete this work that involves the decommissioning of the main channel.

For more information, visit the Bacchus Marsh Irrigation District Modernisation Project

Expanding the grid

Victoria’s water grid allows water to be moved from captured and stored to where it is required. Investment in projects to expand the water grid increases water security for rural communities, particularly during drier times.

The following projects are helping to support rural communities with increased water security.

The East Grampians Water Supply/Rural Pipeline Project is an $85.4 million project funded by the Victorian Government ($32 million), the Australian Government ($32 million), and Grampians Wimmera Mallee Water ($21.4 million). The project will construct up to 1,600km of pipeline network to secure domestic and stock water supply covering up to 330,000 hectares of unserviced land in the East Grampians region surrounding Ararat. The scheme may service up to 1,500 rural farming properties with stock and domestic water.

The project will help improve the agricultural productivity and resilience of rural communities across the Ararat, Pyrenees and Northern Grampians shires in the face of climate change – connecting the region with a more reliable water supply due to the connection to the Wimmera Mallee Pipeline delivery network.

For more information, visit the East Grampians Rural Pipeline Project.

The $29 million Mitiamo Pipeline Project is currently underway to construct a new pipeline and stock and domestic scheme to supply 75,000 hectares south-west of Echuca near the townships of Mitiamo, Tennyson and Dingee. Significant water security and water quality issues will be addressed by constructing the new pipeline and supply scheme to reduce water losses by one gigalitre per annum. The flow-on agricultural productivity benefits. The project is on track to be completed in 2021 and funded by the Federal Government ($14.5 million), Victorian Government ($10.2 million) and Goulburn Murray Water ($4.3 million).

For more information about the Mitiamo and District Domestic and Stock Pipeline

The South West Loddon Rural Water Supply Project was completed in 2020 to deliver a 1,065km pipeline to secure a reticulated water supply. The project has significantly improved water quality to more than 1500 rural properties across 2900 square kilometres surrounding Inglewood, Newbridge, St Arnaud and Wedderburn.  The project also expanded the Victorian water grid by providing an interconnection between the Wimmera-Glenelg system and the Goulburn system. The State Government funded the project ($40m), Commonwealth Government ($20m) and the remainder by Grampians Wimmera Mallee Water through customer contributions.

Notably, the project included a memorandum of understanding between Grampians Wimmera Mallee Water and the traditional local 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.

For more information, visit the South West Loddon Rural Water Supply Project

Feasibility studies

Feasibility studies are supported to establish whether a business case should be developed for a project proposal. The Victorian Government funds the following feasibility study.

Southern Victoria Irrigation Development (SVID) feasibility study

The SVID feasibility study delivered by Southern Rural Water (SRW) identifies infrastructure options for potential irrigation development in Central Gippsland based on customer demand and willingness to invest, and water availability. It builds on SRW’s pre-feasibility work in 2018 and revisits previously identified areas preferred for development along the Avon and Latrobe catchments.

The SVID feasibility study will not determine the utilisation of water resources for irrigation development - the Central and Gippsland Region Sustainable Water Strategy explores this. The SVID feasibility study will provide a pathway for Government to make responsible strategic investment decisions related to rural water infrastructure in the context of the Latrobe Valley mine rehabilitation work and local job transition.

SRW will complete the feasibility study in 2021.

Page last updated: 30/06/21