Chapter 6: Water

6.4 Groundwater

Previous Contents Next

6.4 Groundwater

Demand for groundwater resources in New South Wales has increased as access to surface water supplies has become constrained. Although extraction from some groundwater resources has been above the long-term sustainable yield in recent years, use is now being managed to the sustainable yield through the implementation of water sharing plans for groundwater.

The Upper and Lower Namoi, the Lower Murrumbidgee and the Lower Lachlan alluvial aquifers have continued to experience high levels of extraction over the last three years. Areas that are still over-allocated but not presently over-extracted include some parts of the Murrumbidgee, Macquarie–Bogan, Murray and Hunter River catchments.

The current drought has increased the demand on groundwater resources, causing localised stresses in parts of some other groundwater systems.

The Great Artesian Basin is over-allocated in one water source only – the Eastern Recharge Groundwater Source. However, the program of capping and piping bores is conserving current groundwater resources and artesian pressure in the western two-thirds of the basin. This has resulted in water savings of 47,000 megalitres per year and improvements in groundwater pressure.

The development of statutory groundwater sharing plans to reduce entitlements to sustainable levels over the 10 years of the plans is an important step and significant progress has already been made in managing extractions over the reporting period.

NSW indicators

Indicator and status


Information availability

Extent and condition of groundwater-dependent ecosystems



Long-term extraction limit: use

No change


Long-term extraction limit: entitlement



Land-use impacts on groundwater



Access at regional scale



Localised impacts

No change


Aquifer integrity

No change


Groundwater quality



Notes: Terms and symbols used above are defined in About SoE 2009 at the front of the report.


Where surface water is available, groundwater is generally seen as a supplementary water resource. However, for many communities in regional NSW, groundwater is the primary source of water for drinking, stock and domestic use, agriculture and other industries.

Importantly, too, a range of ecosystems depend on groundwater for their continued survival, including some surface water bodies (wetlands, rivers and lakes) that are connected to groundwater, as well as some terrestrial ecosystems.

Significant changes in groundwater quality and quantity have the potential to degrade ecosystems and affect human uses of water. Because of the hidden nature of many groundwater dependent ecosystems, the impacts are likely to be less obvious and well-understood.

Status and trends

Extent and major uses of groundwater in NSW

Approximately 11% of the water used in NSW comes from groundwater sources. It is used for drinking water, irrigation, watering stock, and domestic and industrial purposes.

Agriculture and mining are the largest users of groundwater in NSW, with the greatest volume used for irrigation in areas around the main inland alluvial aquifers. For some inland mining operations, groundwater is the only available source of water, but it may also be an obstruction or hazard that must be removed before mining can proceed.

For more than 200 towns in NSW, groundwater is the principal source of water supply. An estimated 13% of the groundwater used in NSW goes to domestic and stock purposes.

Levels of extraction and recharge

Variability in climatic conditions affects the amount of groundwater used. Extraction may increase substantially in times of drought to offset the lack of surface water, while in periods of high rainfall, groundwater will be recharged more and used less.

Due to the heavy competition for surface water supplies in NSW, demand for groundwater resources has generally increased over the past 10 years. Table 6.11 shows metered groundwater extraction from aquifers in NSW over the nine years to 2007–08. Extraction peaked at around 1300 gigalitres in 2002–03. However, extraction levels are highly variable from year to year. Apart from 2002–03, extraction has generally been between 500 and 1000 GL per year.

Table 6.11: Annual metered levels of NSW groundwater extraction, 1999–00 to 2007–08


Yearly total (GL)



















Source: DWE data 2008

Long-term average extraction limits

The intent of water sharing plans for groundwater (see Responses below) is to manage the resource sustainably so that extraction remains in balance with yield over the longer term. This means that over-extraction in times of drought, for one or several years, is permissible, providing that extraction drops back below the sustainable yield after the period of drought to allow water levels to recover. This natural flexibility of groundwater systems provides for a reliable and secure water resource.

The long-term average extraction limit is the level of groundwater that can be extracted sustainably on an annual basis. Where data is available, the extraction limit is based on numeric models which relate rainfall and river leakage to recharge over a period of 20 to 30 years. Where insufficient data is available, it is based on a percentage of the annual average rainfall being captured as recharge. The final extraction limit is then set after a portion is allocated to the environment, based on the environmental assets identified as requiring protection.

In large areas of NSW the potential to extract groundwater is low because of geomorphological factors or the quality of the water is not suitable for use. At the state scale, therefore, the overall level of entitlement compared with the long-term average extraction limit is quite low, at around 20%.

The geological province of the inland alluvium lies in the flat lands of north-western and south-western NSW and provides high-yielding, good quality water supplies which are able to be used extensively for irrigation. About 80% of all groundwater extraction in NSW is from these aquifers.

As a consequence, it is only in the inland alluvium that there is pressure to manage groundwater sustainably and the overall level of entitlement is close to the long-term average extraction limit. Since the 1980s, there has been an embargo on further licences in the inland alluvium and annual limits have been placed on extractions. Figure 6.5 shows the pattern of extraction from the aquifers of the inland alluvium compared with the long-term average extraction limit in the nine years to 2007–08.

Figure 6.5: Total extraction levels from inland alluvial aquifers, 1999–00 to 2007–08

Figure 6.5

Download Data

Source: DWE data 2008

Usage levels reflect the overall state patterns shown previously in Table 6.11. The peak in water use during 2002–03 may largely be attributed to drought conditions. Although subsequent years have also felt the impact of drought, groundwater use in the major alluvial systems has stabilised, mainly because of the management of extractions through annual allocations and the implementation of water sharing plans.

Over-extraction of aquifers

The inland alluvium is comprised of a number of individual aquifers and groundwater use can be quite variable, both within and between aquifers. Overall, however, some aquifers still have a relatively high level of extraction compared with the long-term average extraction limit set in the water sharing plans. This is because these plans provide for progressive reduction in entitlements over their 10-year term, allowing water users to adjust to the lower levels of entitlement (see Responses below). Map 6.3 shows the annual extraction levels against the long-term average extraction limit for groundwater aquifers in NSW.

Map 6.3: Extraction from groundwater aquifers as a percentage of the long-term average extraction limit, 2007–08

Map 6.3

Areas where extraction above the long-term average extraction limit occurred during 2007–08 include the Lower Namoi alluvium, some zones in the Upper Namoi alluvium, the Lower Murrumbidgee and the Lower Lachlan alluviums. The Great Artesian Basin, underlying a large portion of north-western NSW, is not over-allocated, except for the Eastern Recharge Groundwater Source, but has lost pressure in some areas due to free-flowing bores.

Groundwater dependent ecosystems

'Groundwater dependent ecosystems' are those that rely in some part for their survival on groundwater. Dependence ranges from complete reliance for some systems to others that rely partially on groundwater, particularly during times of drought. The degree and nature of dependency influences the extent to which ecosystems are affected by changes to groundwater aquifers, both in quality and quantity.

The national Connected Water Program, under Management of Ecosystems: Groundwater Dependent Ecosystems, identifies six types of systems (Hatton & Evans 1998), as described below.

Terrestrial vegetation may depend on diffuse discharges of shallow groundwater to varying degrees, either to sustain transpiration and growth through a dry season or to maintain perennially lush ecosystems in otherwise arid environments.

Wetland ecosystems may depend on groundwater to keep them seasonally waterlogged or flooded. Wetlands provide the most extensive and diverse set of potentially groundwater dependent ecosystems in Australia. Examples include mesophyll palm vine forests, paperbark swamp forests and woodlands, swamp sclerophyll forests and woodlands, swamp scrubs and heaths, swamp shrublands, sedgelands and mound springs ecosystems.

River baseflow systems: Many river reaches have a baseflow component of groundwater discharge. This groundwater component may be vital to the character and composition of in-stream and near-stream ecosystems.

Aquifer and cave ecosystems: The life forms that live in karst or limestone caves with their porous and fissured aquifers, particularly microorganisms and invertebrates, are heavily dependent on groundwater availability. Life in cave aquifers may be as rich as it is above ground.

Terrestrial fauna: Groundwater dependent fauna have a reliance on groundwater that is not based on the provision of habitat, but as a source of drinking water. Groundwater, as river baseflow or discharge into a spring or pool, is an important source of water across much of the country, particularly in northern and inland Australia and other areas with a semi-arid climate. Its significance is greater for larger mammals and birds, as many smaller animals can obtain most of their water requirements from their food or respiration.

Pastoralists in inland Australia have made extensive use of groundwater to supply drinking water to grazing stock. In addition to watering stock, groundwater is also used by native fauna, such as kangaroos, and pest and feral animals. Provision of water has allowed larger populations of both wildlife and pest animals to be sustained than would otherwise be the case.

Estuarine and near-shore marine systems which may depend on groundwater discharges to provide a suitable habitat include coastal lakes, mangroves, saltmarshes and seagrass beds. Groundwater discharge may be in the form of direct off-shore discharge or baseflow into streams that discharge to the ocean.

Identification of groundwater dependent ecosystems

Interest in groundwater dependent ecosystems and their sustainability is relatively recent and little is known about their location or condition (Eamus & Froend 2006). A preliminary desktop study in NSW has identified a range of sites where GDEs could potentially occur (Table 6.12). Follow-up field survey work is needed to establish the extent of natural values and the condition of these sites, as well as their level of groundwater dependency.

Table 6.12: Number and type of potential groundwater dependent ecosystems identified

Ecosystem type


Aquifers and karst


Terrestrial vegetation




River baseflow


Estuarine and near-shore marine


Terrestrial fauna


Source: DECCW data 2009


Excessive extraction and demand

Over the longer term, reducing the storage levels of an aquifer or permanent mining of the resource, will affect its stability and integrity, as well as having permanent consequences for all dependent ecosystems and beneficial uses. The aim of water sharing plans is to ensure that this does not occur and that water is managed sustainably.

Saline intrusion

Where the level of extraction of groundwater is high and the aquifer is overlain by saline aquifers or near the coast, there is a risk of saline water intrusion into the depleted aquifer. This will have a detrimental effect on water quality and related uses.

Chemical contamination

Groundwater contamination by chemical pollutants can significantly reduce the value of water to users or the environment and increase the cost of water treatment. It may prevent some types of water use altogether. Once an aquifer is polluted, it is extremely difficult and expensive to restore. Groundwater contamination is largely associated with long-standing existing or former industrial areas and tends to be in urbanised areas concentrated around Sydney, Newcastle and Wollongong.

Climate change

The sustainable yield project for the Murray–Darling Basin identified that the current and probable future levels of groundwater extraction will have a greater impact on inland aquifer systems than a likely reduction in recharge from rainfall and river systems due to climate change. Along the coast, the potential impacts of sea level rise and climate change on coastal aquifers will be more significant with saline intrusion on freshwater coastal aquifers affecting associated groundwater dependent ecosystems.


State Plan 2006

State Plan 2006: A new direction for NSW (NSW Government 2006) has the following target under Priority E4: 'By 2015 there is an improvement in the ability of groundwater systems to support groundwater dependent ecosystems and designated beneficial uses'. A Monitoring, Evaluation and Reporting (MER) strategy is being implemented to monitor progress towards all E4 targets.

A review of State Plan 2006 commenced in August 2009 and this may adjust some of the plan's priorities and targets.

Water sharing plans for groundwater

The Water Management Act 2000 requires all groundwater aquifers to be managed sustainably and this is occurring through the implementation of statutory water sharing plans for groundwater. The intent of these plans is to manage the resource so that extraction remains in balance with yield over the longer term.

The environmental provisions in the groundwater sharing plans are centred on:

  • protecting the long-term storage component of the aquifer
  • reserving a proportion of the average annual recharge for the environment.

From July 2008 an embargo has applied to the issue of further entitlements to groundwater in inland NSW. New entitlements are also not being issued in some parts of coastal NSW to protect the environment and the availability of water to existing licence holders.

In some NSW groundwater systems, the level of extraction currently licensed is greater than the sustainable yield of the aquifer. This is mainly the case in the major inland alluvial aquifers: the Upper and Lower Namoi, Lower Gwydir, Lower Macquarie, Lower Lachlan, Lower Murrumbidgee and Lower Murray groundwater systems. For all such systems the implementation of water sharing plans includes a process to reduce groundwater entitlements and use to align with the sustainable yield of aquifers over the 10 years of the plan.

Thirteen water sharing plans for groundwater have been implemented since 2004, while another four are being finalised for coastal aquifers. Through these plans, entitlements in these aquifers have been reduced by a total of 942 GL per year. Eventually all groundwater systems will be subject to water sharing plans, which will ensure that entitlements are brought into equilibrium with the sustainable yields of aquifers throughout NSW.

Achieving Sustainable Groundwater Entitlements Program: The Australian and NSW Governments are funding this program to minimise the impact of the reductions in groundwater entitlements required by water sharing plans in the state's six major inland alluvial groundwater systems. Under the program, financial assistance is provided to affected groundwater licence holders to help them adjust to new levels of entitlement.

Cap and Pipe the Bores Program

Since the 1990s, various programs have been in place to cap and pipe bores across the Great Artesian Basin which underlies parts of NSW, Queensland and South Australia to reduce water wastage and improve groundwater pressure. The Cap and Pipe the Bores Program provides financial incentives to landholders to offset the cost of rehabilitating bores and installing efficient piped systems to replace open bores. The pipeline systems provide water to properties, prevent large quantities of salt from entering drainage systems, and help drought-proof properties. These measures have produced savings of 47,000 megalitres per year and there has now been an increase in water pressure across the basin.

Groundwater Dependent Ecosystems Policy

The NSW State Groundwater Dependent Ecosystems Policy (DLWC 2002) provides guidelines on how to protect and manage groundwater dependent ecosystems. Further work will help to establish the location of these ecosystems and how heavily they rely on groundwater.

Other programs

Other programs to manage groundwater include work by the Government to improve understanding of the relationship between surface water and groundwater and the impact of groundwater extraction on river systems. These programs are identifying where groundwater systems are highly connected to surface water systems.

Future directions

Current knowledge of groundwater recharge and availability is based on estimates using the limited data available and conceptual models of groundwater systems and recharge. Continued monitoring of extraction will improve the basis of these models and enable greater accuracy when setting extraction limits.

More comprehensive metering of extraction should be conducted in some groundwater management areas in NSW. Currently, irrigation and high-yield bores must be metered, but in many groundwater management areas meter readings are not reported. Although the quality of data about groundwater use has improved, further information is needed to assess the status of groundwater extraction more effectively and better manage impacts on resource security.

The connections between groundwater and surface water systems need to be better understood. The potential for integrated management of closely linked systems as a single resource needs further development. There is a risk that more stringent limits on the use of surface water will place greater pressure on groundwater as a substitute source of water.

Knowledge of groundwater dependent ecosystems is still at an early stage and better understanding is needed of their location, characteristics and levels of dependency. Little is also known about the fauna and flora that live within, or are dependent on, groundwater aquifers and this makes it difficult to manage groundwater systems to protect them.