BEFORE THE ENVIRONMENT COURT AT CHRISTCHURCH

I MUA I TE KOTI TAIAO O AOTEAROA Kl OTAUTAHI

IN THE MATTER

AND

BETWEEN

AND

Decision No. [2020] NZEnvC 194

of the Resource Management Act 1991

of an appeal under s 120 of the Act

CLUTHA DISTRICT COUNCIL

(ENV-2019-CHC-132)

Appellant

OTAGO REGIONAL COUNCIL

Respondent

Court: Environment Judge J E Borthwick Environment Commissioner A C E Leijnen

Hearing: at Dunedin on 23 September 2020

Appearances: S Peirce for the appellant M Mehlhopt for the respondent

Date of Decision: 19 November 2020

Date of Issue: 19 November 2020

DECISION OF THE ENVIRONMENT COURT

A: The appeal is declined.

B: Any application for costs must be filed by Friday 4 December 2020 and any reply

must be filed by Friday 11 December 2020. In the event no application for costs

is made, the court's order will be (without further decision of the court issuing) that

there is no order as to costs.

CLUTHA DC v ORC - DECISION

Introduction

2

REASONS

[1] Clutha District Council applied for a water permit to take and use surface water

from the north branch of the Clutha River/Mata-Au. Water is needed for the Bruce Water

Supply. The District Council has previously held permits for this scheme and this appeal

concerns an application for a replacement permit.

[2] Resource consent was granted by the Otago Regional Council with a duration of

25-years. The Clutha District Council appeals this decision, seeking instead a 35-year

term.

[3] The appeal is opposed by the Otago Regional Council.

Background

[4] Through its infrastructure network, the Clutha District Council takes water from

the true left bank of the Matau branch of the Clutha River/Mata-Au to supply to rural and

urban destinations. Urban destinations include the townships of Stirling and Benhar, and

the Cherry Lane suburb in Balclutha. 1 • 2 Water is also distributed through the South Bruce

rural water supply to a command area of some 4,594 hectares. 3

[5] The application for the water permit to take and use water specified a maximum

rate of take of 42 litres per second and a maximum daily volume of 3,600 cubic metres

per day. This is the same rate of take and daily volume that applied to the District

Council's expired permit, which had a duration of 20-years.4

[6] A standard form application was filed clearly identifying that the water was for a

public community water supply, noting that details would be provided in the Assessment

of Environmental Effects ("AEE"). While the form prompts an applicant to provide details

1 AEE, p 1; Essenberg, EiC at [8]. 2 The urban supply (at least) the scheme is a registered community water supply and is subject to a public

,,, ,

3

of other uses of water, these were not filled out.5

[7] The AEE attached to the application records that the "predominant" use of water

under the existing permit is for stock and potable water supply. 6 The AEE notes the

volume of water to be taken allows for existing use and for any "possible future growth

and expansion of the water supply scheme" .7 Neither the application nor AEE estimate

the efficiency of current usage, but the applicant asserts the existing and future demand

is efficient because it is a restricted supply to the rural area and metered in Stirling

Township. 8 While we do not consider these reasons prove efficiency of use, 9 the District

Council produced a rudimentary water balance in evidence to back this up which the

Otago Regional Council did not challenge. From this water balance, it transpired 80% of

water is supplied to the rural area for stock water and dairy shed purposes.

Decision under appeal10

[8] The Regional Council granted the water permit limiting its duration to 25-years.

This decision was made prior to the notification of proposed Plan Change 7 to the

operative Regional Plan: Water for Otago ("PCT'). In deciding upon a 25-year duration,

the Regional Council took as its starting point the matters set out in Policy 6.4.19 of the

operative Regional Plan, observing this to be a general policy on consent duration.

[9] The Regional Council noted .that the volume of water included a portion for

contingency supply which may or may not be required in the long term, and could

become an inefficient allocation of water should the flow regime in the Clutha

River/Mata-Au change. The Regional Council was concerned that granting the consent

for 35-years would effectively determine the ongoing allocation regime for the entire

catchment in advance of an upcoming plan process. Having regard to the communal

uses of the water, it determined that a term of 25-years would provide long term security

of supply.

[1 O] In arriving at its decision, the Regional Council took into consideration the policy

,"~8;L~~-,,, 5 See Transcript (Heller) at 33-34. "''

4

in the lwi Management Plan that grants should not exceed 25-years, recording this was

one of a number of factors that led to its decision.

[11] While the Regional Council noted the high volume of water flowing in the river, it

considered that the consent conditions proposed were unlikely to be able to anticipate or

control for emerging environmental effects over a 35-year period and that a review

condition should not be relied upon as a means to grant a long-term permit as there is a

high degree of risk and uncertainty with review conditions.

[12] There is no indication in the decision, that we could find, that the Regional Council

knew that the uses included the supply to dairy sheds. 11

Operative Regional Plan: Water for Otago ("Regional Plan")

[13] The fact that the use and development of otago's water resources has the

potential to adversely affect water supply values, is identified as being a key issue for

Otago in the operative Regional Plan. Human use values supported by Otago's lakes

and rivers are to be maintained or enhanced (Objective 5.3.1). Human use values

include "water supply values" (Policy 5.4.1 (e)) and activities involving surface water will

be managed to avoid (preferentially) adverse effects on water supply values (Policy

5.4.2).

[14] "Water supply values" is defined and means: 12

The existence of a take for human consumption, which people and communities have come

to depend on.

[15] "Water supply values" are found in Schedule 1 B of the Regional Plan (Objective

5.3.1, see also Policies 5.4.1 and 5.4.2). Schedule 1 B is a list of takes from lakes and

rivers, where the water taken is for public water supply purposes. This list includes the

Bruce Water Supply. 13

,,.-:--·-... , 11 The officer who, reporting under s 42 of the Act on the application, notes only water supply for human and \S ~~.r?f· ;?)\ stock consumption. See notice of appeal, ORC Substantive Decision Recommending Report: pp 11, 14, 20

,

5

[16] Objective 6.3.2 is also important in this proceeding. This is:

To provide for the water needs of Otago's primary and secondary industries, and community

domestic water supplies.

Assuming stock falls under primary industry category, we were not referred to any

specific policies that apply particularly to the primary industry. As the Clutha River/Mata-

Au does not have a primary allocation (Policy 6.4.1 ), we have not considered Policy 6.4.8

and its related provisions although these were referred to in evidence. If Policy 6.4.2A

applies, 14 an application to take and use water involving a registered community drinking

water supply may seek an allowance for growth that is reasonably anticipated.

[17] Policy 6.4.19 lists relevant considerations when setting the duration of a resource

consent to take and use water. These are:

(a) The duration of the purpose of use;

(b) The presence of a catchment minimum flow or aquifer restriction level;

(c) Climatic variability and consequent changes in local demand for water;

(d) The extent to which the risk of potentially significant, adverse effects arising from the

activity may be adequately managed through review conditions;

(e) Conditions that allow for adaptive management of the take and use of water;

(~ The value of the investment in infrastructure; and

(g) Use of industry best practice.

[18] Chapter 7 sets out the objectives and policies for water quality. We note Objective

7.A.2 below and come back to this later in our discussion of the Kai Tahu ki Otago Natural

Resource Plan:

Objective 7.A.2

To enable the discharge of water or contaminants to water or land, in a way that maintains

water quality and supports natural and human use values, including Kai Tahu values.

Two supporting policies were also referred to in evidence, 15 but not otherwise assessed.

Their relevance is not clear.

·-0 " ---~ ~ I ,"-;,

6

[19] Finally, we note "community domestic water supply" (Objective 6.4.8) and

"community water supply" (Rule 12.1.3.1 and elsewhere) are not defined by the Regional

Plan. While not defined, there are several indications in the explanatory text to the

Regional Plan that "community water supply" are the schemes listed in Schedule 1 B.

Proposed Plan Change 7 to the Regional Plan

[20] The objectives and policies of proposed Plan Change 7 are also relevant and we

turn to these next.

[21] First, a proposed new objective introduces an interim planning framework to

manage, inter a/ia, replacement water permits to take and use surface water (Objective

1 0A.1.1 ). 16 Policy 1 0A.2.1 provides, irrespective of any other policy in the Regional Plan,

granting resource consent to take and use surface water is to be avoided except in limited

circumstances where:

(a) the deemed permit or water permit that is being replaced is a valid permit;

and

(b) there is no increase in the area under irrigation, if the abstracted water

is used for irrigation; and

(c) there is no increase in the instantaneous rate of abstraction; and

(d) any existing residual flow, minimum flow or take cessation condition is

applied to the new permit; and

(e) there is a reduction in the volume of water allocated for abstraction.

[22] Policy 10A.2.3 contemplates a consent duration exceeding six years may be

granted for non-complying activities only where the following is proven:

(a) the activity will have no more than minor adverse effects (including no

more than minor cumulative effects) on the ecology and the hydrology of

the surface water body (and any connected water body) from which the

abstraction is to occur; and -...,,,,. 1/y·\

"\..,...:.\'\ /i courn oi ~:'.:""

,,,,dV"'

7

[23] Rule 1 0A.3.2.1 is the rule for non-complying activities and states:

10A.3.2.1 Despite any other rule or rules in this Plan:

(a) any activity that is the replacement of an activity authorised under a

Deemed Permit; or

(b) the take and use of surface water (including groundwater

considered as surface water under policy 6.4.1A (a), (b) and (c) of

this Plan) that is the replacement of a take and use authorised by

an existing water permit where that water permit expires prior to 31

December 2025;

that does not meet any one or more of the conditions of Rule 1 0A.3.1.1 is a

non-complying activity.

[24] Both Policy 1 0A.2.1 and Policy 10A.2.3 are very directive as the opening words

make clear:

Policy 1 0A.2.1 "Irrespective of any other policies in this Plan, avoid granting

resource consent ... except where ... ";

Policy 1 0A.2.3 "Irrespective of any other policies in this Plan concerning consent

duration, only grant resource consents ... for a duration of no more than six years,

except where ... ".

Regional Policy Statement

[25] While the planners assessed the proposal directly under the Regional Policy

Statement, we decline to do the same. There seems to be little point to the exercise if

the Regional Policy Statement does not give effect to the National Policy Statement for

Freshwater Management as amended in 2017 or the new National Policy Statement for

Freshwater Management released in 2020. We understand that the Regional Council

intends on a complete review of this policy document - together with the operative

Regional Plan.

8

Weight to be given to the plan changes

[26] Giving planning evidence on behalf of the District Council, Mr Cubitt regards the

provisions in PC? supporting 6-year consent duration for water permits, as "arbitrary" -

particularly where the purpose of the water permit is to provide a secure and reliable

water source for the community. 17 He was troubled by the fact that Policy 6.4.19 of the

Regional Plan (addressing consent duration) has not been deleted or amended by PC?

and consequently he found PC?'s provisions incoherent. 18 While he acknowledged the

PC? provisions are a significant shift in policy, he points out that it remains to be seen

whether they promote the purpose of the Act. 19 Interpolating his evidence, he appears

to be saying the decision by the Regional Council to grant a 25-year consent effectively

negates the purpose of the plan change as the grant already is well beyond the lifespan

of the yet to be notified Land and Water Regional Plan. 20

[27] Mr Cubitt goes as far as saying that it would be a "complete injustice" to give

weight to PC?'s provisions21 and that the plan change should be given either no22 or

insubstantial weight. 23

[28] Counsel for the District Council, Mr Peirce, also submitted that PC? should be

given little weight. Aside from the fact that the plan change has yet to be subject to

independent testing and decision-making, it is unclear what principles the District Council

would have the court bring to bear on the weighting issue. For the most part the matters

raised by counsel concern the merits of the proposal, including the absence of evidence

that the take and use will have an adverse effect on water quantity or quality. These

considerations, however, do not inform the weight to be given to the proposed plan

change. 24

[29] On the other hand, Mr Bell for the Regional Council, would give PC? some

weight. 25 Acknowledging PC? has yet to be subject to independent testing and decision-

17 Cubitt, EiC at [84(f)]. 18 Cubitt, EiC at [84(d)]. 19 Cubitt, EiC at [84(e)]. 2° Cubitt, EiC at [84(g)].

,,,,,.,,,,~t '''->· 21 Cubitt, EiC at [84(c)]. '\'

9

making, he too notes the significant shift in policy around the taking and use of water. As

for any injustice that would arise if its provisions were given weight, he observes the

consideration of PC7 arises by operation of the Act. 26

[30] Setting out the relevant principles27 that the courts have applied when considering

the weighting on a proposal, Ms Mehlhopt for the Regional Council submits greater

weight should be placed on PC7 than the operative Regional Plan.28 She drew to our

attention the observations made by the Environment Court in Granger v Dunedin City

Council, 29 which we adopt. Weight has two aspects:

When discussed in the context of a plan, weight has at least two aspects. First, the weight

to be given to the provisions of a recently notified plan which may yet be modified by

submissions on the plan and through the appeal process. Secondly, the weight (or strength

of direction) of its individual provisions ...

Consideration of weighting

[31] As a matter of law, both the provisions of the Regional Plan and the proposed

plan changes are to be considered under s 104(1 )(b) of the Act. We accept Ms

Mehlhopt's submission that PC7 is a standalone chapter proposed for the Regional Plan

and, as she invites, we have considered the proposal under the provisions of PC7 and

separately, under the relevant provisions of the operative Regional Plan.30

[32] The decision to grant the 25-year permit was made prior to the notification of PC7.

Notwithstanding the significant shift in policy pertaining to consent duration, the Regional

Council continues to support its decision. 31

[33] Applying Policy 1 0A.2.1 ( e) of PC7 to an application to replace an expired water

permit to take and use water solely human consumption, a grant of consent is to be

avoided except where there is a reduction in the volume of water allocated for abstraction.

This appears to create tension with the recognition given to "water supply values" in

Objective 5.3 and related policies of the operative Regional Plan and with the second

26 Bell, EiC at [143]. 27 Regional Council, submissions at [71] and [77]. 28 Regional Council, submissions at [69]-[85]. 29 Granger v Dunedin City Council [2018] NZEnvC 250 at [42].

0 Regional Council, submissions at [47]-[54]. 1 Regional Council, submissions at [2]-[3].

10

priority of Objective 2.1 of the National Policy Statement for Freshwater 2020.

[34] In the specific context of supply for human consumption, we presently would give

more weight to Objective 5.3 of the operative Regional Plan than Policy 1 0A.2.1 of PC?.

The position is less clear for Objective 6.3.2 because of the range of uses the community

water supplies can provide including water for human consumption (see also paragraph

[19] above).

[35] That said, we are not persuaded by Mr Cubitt that the proposed plan change,

taken together with Policy 6.5.19 of the operative Regional Plan, is incoherent. Policy

1 0A.2. 3 is plainly directive - only grant consent for a duration "no more than six years"

except in the case of a non-complying activity where it can be demonstrated that the

activity will have no more than minor adverse effects (including cumulative effect) on the

ecology and hydrology of the surface waterbody from which abstraction is to occur. Thus,

the policy contemplates grants longer than six years in certain circumstances. To the

extent that the matters listed in Policy 6.4.19 are relevant, they are to be considered in

addition to Policy 1 0A.3.2.

[36] Conceivably, Policy 10A2.3 could apply to decline consent to take and use water

for human consumption where there was an adverse effect on the environment, for

example where end-use District Council wastewater systems are inadequate. However,

we think the more likely outcome under this policy is to grant consent for a period up to

six years as an interim measure. Given this, we give weight to Policy 1 0A.2.3 and apply

the policy according to its tenor.

Status of the activity

[37] Rule 12.1.3.1 provides that the taking and use of surface water for any

"community water supply", is a controlled activity. The Regional Council has restricted

the exercise of its control to a number of listed matters, of which the duration of consent

(12.1.3.1 (f)) and review condition (12.1.3.1 (i)) remain of particular relevance on appeal.

11

[39] Counsel for the Regional Council, Ms Mehlhopt, thought the status of the activity

as being of little relevance. 32 We agree with counsel. The appeal is concerned with the

duration of the consent and this is a matter which the consent authority has restricted

control under the controlled activity rule (Rule 12.1.3.1 ). That aside, regardless of the

location of two new additional in-take structures, the proposal is for the purpose of the

Bruce Water Supply, a listed scheme in Schedule 1 B of the Regional Plan and for that

reason we would consider it a controlled activity under Rule 12.1.3.1 of the Regional

Plan.

[40] The proposal would be a non-complying activity under PC7. However, as the

application was lodged prior to the notification of the plan change, we will decide the

appeal as if it were an application for a controlled activity pursuant to s 88A of the Act.

The evidence

[41] As mentioned already, the court heard evidence from planners Messrs Bell and

Cubitt, on behalf of the Regional Council and the District Council respectively. In addition,

we also heard evidence from Mr Thomas Heller, consultant on water resources and

related disciplines, who prepared the application for resource consent, and Mr Gerald

Essen berg, the manager of Capital Delivery at the District Council. None of the witnesses

were cross-examined.

[42] We will not summarise their evidence but address key points which cause us to

decline the appeal and confirm the 25-year duration. If a matter is not mentioned, it is

because the evidence is not such that the court can make a finding of fact or opinion or

the matter has little bearing on the outcome overall.

Discussion

Reduction in volume

[43] Despite the weight Mr Cubitt would give PC7, he accepts the plan change is

relevant. In his opinion the proposal is not contrary to Policy 10A.2.1.33 While the

applicant did not reduce the instantaneous rate of take limit or daily volume limit, 34 the

32 Transcript (Mehlhopt) at 26. 33 Cubitt, EiC replacement text at [81]. Transcript (Cubitt) at 77. 34 See Cubitt, EiC at [81] and replacement text [81] where he said he said the rate of take and daily volume remained the same to allow for urban growth and as a contingency against climate change.

12

consent authority did impose new restrictions on the volume of water to be taken each

month and year. Therefore, he says there has been a reduction in the volume of water

allocated for abstraction - at least on a monthly and annual basis.

[44] On the other hand, Mr Bell maintained the volume of water abstracted had not

been reduced and, therefore, in his opinion, the water permit was contrary to Policy

1 0A.2.1, which is to "avoid" - he interprets - as 'not allow' or 'prevent' granting resource

consent except where (relevantly) there is a reduction in the volume of water

abstracted. 35

[45] As we noted, none of the witnesses were cross-examined and we have found it

difficult, at times, to reconcile their opinions.

[46] PC? was notified after the water permit was granted. Policy 1 0A.2.1 is

implemented by the controlled activity rule (Rule 1 0A. 3.1 ). That rule contemplates the

"reduction in volume of water allocated for abstraction" is to be calculated using the

methodology in Schedule 10A.4.2. The Schedule is complex, and Mr Cubitt does not

say whether the plan change methodology informed his opinion that the proposal gives

effect to this policy. There is no evidence before us that the restrictions on the volume of

water to be taken were calculated in accordance with the same methodology as now

appears in PC?. Indeed, there is no explanation as to how the rates and volumes were

derived. 36

[47] On the issue of whether there is a reduction in the volume of water allocated for

abstraction, given the range of uses for the water (including for human consumption) this

is a matter we find neutral to the outcome of the appeal (PC?, Policy 1 0A.2.1 ).

Range of uses

[48] The planning witnesses were agreed on the importance of water supply values to

the region and we accept their evidence that under Chapter 5 of the Regional Plan water

supply values have primacy over uses of water for other purposes. 37

13

[49] While "water supply values" is a defined term used in Objective 5.3.1 and Policies

5.4.1 and 5.4.2, the planners may not have been aware of this as their evidence proceeds

on the basis that regardless of the use of water, a scheme, if listed in Schedule 1 B, is

given 'primacy' under the operative Regional Plan. Indeed, Mr Cubitt paraphrases

(inaccurately) Policies 5.4.1-5.4.3 as giving 'primacy' to "community water supply

takes". 38

[50] Occurring in different chapters of the Regional Plan, we do not consider the terms

"water supply values" and "community water supply" are interchangeable. Rather, what

is to be "maintained or enhanced" under Objective 5.3.1 and prioritised under Policy

5.4.2, is the use of water for human consumption not community water supply per se.

[51] The term "community water supply" first appears in Chapter 6: Water Quantity

and in Chapter 12: Water Take, Use and Management and is used in Rule 12.1.3.1

(controlled activities). The operative Regional Plan does not define this term, but it

appears the supply may be for a range of uses. Indeed, the evidence was that the Bruce

Water Supply distributes water for human and stock consumption and also for dairy shed

use. Less than 20% of water is supplied for human consumption.

[52] The range of uses for this water means we are unable to give the matter in Policy

6.4.19(a) of the operative Regional Plan significant weight, as invited by the appellant.

Effect on water quality

[53] The dairy shed use is not noted in the consent application, nor in the decision

granting consent. It is unclear whether the consent authority was aware of this use when

granting consent. The Regional Council planner commissioned under s 42A of the Act

to report to the consent authority on the application, records the proposal as being for a

"community drinking water supply". He notes that the amount of water used by each of

the 314 properties supplied, was twice the volume considered efficient for domestic use.

He assumed a significant proportion of the take was therefore required for stock water. 39

[54] We anticipated receiving evidence on the effects of the end use of water

commensurate as this is relevant to both the determination of consent duration and

38 Cubit!, EiC at [17] and [88]. 39 Notice of appeal, Attachment 'ORC Substantive Decision Recommending Report' at [5.6].

14

secondly, whether to impose a review condition. On the topic of effects, Mr Heller

concludes: 40

There are no known measurable effects on water quality of the Clutha River as a result of

the water take, as the primary use of the water is for human consumption and stock water.

Water is not used for irrigation. Any adverse effects arising from water used for dairy shed

supply are managed by each farm's dairy wastewater system that is subject to a separate

consent process with the ORC.

To reiterate, the rate of water take is small when compared to the available water flow within

the Clutha River Mata-au, and the rate that water can be taken as a permitted activity. The

effects of the water take are so small that the effects cannot be measured in any quantitative

sense.

[55] The court questioned the District Council's witnesses over the effects of the end-

uses, particularly in association with dairy sheds. The opinions of the District Council's

witnesses appeared to be that this was of no moment. For the District Council, Mr

Essenberg said any issue arising as to the effect of discharge of water used in dairy

sheds is a matter for the Regional Council and he told the court that the District Council

does not require proof that the farms to which it supplies hold any requisite permit. 41 For

his part, Mr Heller acknowledged that wash down from dairy sheds contains a range of

contaminants. He did not know whether the farms which the District Council supplied

water, held permits for the discharge of contaminants but speculated most would. From

his standpoint the effects of contaminants from this source are managed under the

Regional Plan's rules. 42 Mr Cubitt appeared to say that the only contaminants of concern

are those associated with irrigation,43 which is not a proposition we would accept.

[56] Contrary to the understanding of the above witnesses, Mr Bell's evidence was

that most dairying activities are permitted in Otago, subject to compliance with the

standards in the plan.44 Had he processed the resource consent for the Regional

Council, he would have considered whether the water was being efficiently used45 and

secondly, what was to happen to the water after its use.46

40 Heller, EiC at [31 ]-[32]. 41 Transcript (Essenberg) at 60. 42 Transcript (Heller) at 38-40; EiC at [31]. 43 Transcript (Cubitt) at 80.

, 4 Transcript (Bell) at 103. 4 Efficiency appears to be calculated using standards for the particular type of activity the water is to be

ed, Transcript (Bell) at 107.

15

[57] That the effect of the end-use of water is relevant is not disputed by the District

Council; the District Council lead on the topic of water quality from Mr Heller. The

acceptability of any effect on water quality from dairy uses was predicated on the

Regional Council managing through its Regional Plan the effects of any subsequent

discharge. As for the other consumptive uses (human and stock water supply), we were

told there were no known effects on water quality. This evidence was also not disputed,

and we accept it at face value.

[58] Evidence on water quality was limited to data from the Regional Council's

monitoring site on the Clutha River/Mata-Au upstream of the scheme's command area.

There is groundwater within the command area and possibly two or three surface

waterbodies in addition to the Clutha River/Mata-Au, about which no evidence on water

quality was led.47 We considered the publications referred to in the evidence of Mr Heller

on water quality. 48 Save in relation to water clarity, his reporting is not inaccurate.

However, the evidence does not give a full picture as, for example, he omits to discuss

trend lines over the last 5, 1 O or 15-year period reported by Land and Water Aotearoa.

[59] None of the witnesses had turned their minds to proposed Plan Change 8 to the

Regional Plan ("PC8").49 From our reading of the plan change, PC8 introduces new

provisions pertaining to the storage of effluent and its application to land. The section 32

Report that accompanied PC8 discusses the issues arising in relation to the storage of

animal waste, including from dairy sheds, and its application to land. The report states

the Regional Plan does not manage the storage component, and its current rules either

permit or prohibit the discharge and do not, as the District Council witnesses thought,

manage the process through discharge permits. 5° Further, without a rule in the plan the Regional Council does not have the ability to set minimum standards for these systems. 51

[60] PC8 is part of a proposal of national significance that has been referred by the

Minister for the Environment to the Environment Court for decision. We accept the

Regional Council's submission that the reasons given by the Minister for the Environment

16

to call in PC?, and we add proposed Plan Changes 1 and 8, are relevant. In particular: 52

(a) that the issues the plan changes aim to address have aroused widespread

public concern or interest regarding their actual or likely effect on the

environment;

(b) the plan changes involve or are likely to involve the significant use of natural

and physical resources, while managing the impact of that use on the

environment;

(c) the plan changes affect or are likely to affect areas of national significance;

and

(d) failure to implement the plan changes has the potential to result in

significant and irreversible changes to the environment.

[61] Given that up to 30% of the existing take and use of water is to supply dairy

sheds, 53 the District Council has not discharged its persuasive burden of providing

evidence that the court, with any level of confidence, can rely on to make findings about

the existing or future state of water quality within the command area. It follows we are

unable to satisfy ourselves under Policy 6.9.19(d) of the operative Regional Plan that the

risk of potentially significant adverse effects arising from this activity may be adequately

managed through review conditions. In any event, for reasons that we will come to, we

doubt the efficacy of the proposed review condition.

[62] We have considered Mr Peirce's suggestion that the consent could be subject to

an additional condition effectively constraining the supply of new water to farms with an

up to date farm environment management plan. 54 Such a condition is commended, but

it does not address any present-day risk.

[63] The application of Policy 1 0A.2.3 of PC? to the facts is also problematic for the

reason that the evidence is not capable of proving to the requisite standard that the

proposal will have no more than minor adverse effects (including no more than minor

cumulative effects) on the ecology of the Clutha River/Mata-Au (and any connected water

i',,.;;t~~l:.AL ,r5/>~\. 52 Minister for the Environment, Ministerial direction to refer the Otago Regional Council's proposed Omnibus

~

/ ·\\/' '•,:~,\ Plan Change to its Regional Plans to the Environment Court, 8 April 2020; Minister for the Environment,

'/ 11f;\c;_,1 __ -· __ • __ ·_·•f_ ... j. .. ,,, , ___ ,•,_·,,,\), 'Miini~terial direction to refer the Otago Regional Council's proposed Plan Change 7 - Water Permits to its f //i'i:,:\\_l,[t~;J ;;;'!,) eg1onal Plans to the Environment Court, 8 April 2020.

~ \ 't(~1;1JfG:E;)?';J ';;15 Trans~ript (Heller) at 40, Mr Heller estimates stock water consumption is over 50% and human

o \. { 1:jJ,/1\;Y('\:,;1 1 :~-= onsumpt1on around 20%. SY.\ '·)r:;.":~(,:•;;~(,'.{1//V / ~~i'/ 4 Transcript (Peirce) at 74 \\;",~¢.''~,., .. , .. , ,,,,,;,1,,,,,,., ,:1; ,,,,,.l /\/// 1

\, 1/1;, , . .. -, .. - "' .. ,~?~~ ,I • , .. 0oum 01r \:; •· _

,,.. . ...... , ... ,

17

body) from which the abstraction is to occur.

[64] The above findings on effects weighs in favour of a decision confirming the

consent duration.

Contingencies and investment yields

[65] We are not satisfied that the volume granted was to allow contingency for future

urban growth and climate change as asserted (Policy 6.4.19(c)). This may have been

part of the District Council's thinking, but if it was, the sizing of the take to allow for this

contingency was not explained. 55 Mr Essenburg, whose evidence we accept, said the

primary purpose for the additional capacity (approximately 900m3 / day) is to allow the

District Council to supply water to neighbouring schemes should one of them become

inoperable (e.g. be temporarily shut down for maintenance or at times of low flow). 56 To

do this the infrastructure network will need to be upgraded and if this occurs we

acknowledge the District Council's desire to achieve a yield on its investment. Indeed

this is a relevant consideration under Policy 6.4.19(f)). 57

[66] While the value of its investment is an important consideration in our assessment

of the appropriate duration, it is not determinative of the outcome. A known but

unquantified risk to investment yield must be the future impact of regulatory change on

demand for water, particularly from the primary industry. Going forward, it is not known

whether supply demand will soften.

Other matters

[67] Te Ao Marama Inc and Te R0nanga o Hokonui were notified of, but did not submit

on, the application for resource consent. There is a policy in Kai Tahu ki Otago Natural

Management Plan to oppose the grant of permits for the taking of water for a period of

35-years. 58 In Mr Cubitt's opinion this policy "does not offer any value" when assessing

the impact of the proposed take on the resource in question.59 The duration of the permit

excepted, he concludes the application does not conflict with the policies of the Kai Tahu

18

Ki Otago Natural Resource Management Plan.60

[68] We do not share Mr Cubitt's confidence. First, the policy on 35-year consent

durations is predicated as an action that must not occur in order to achieve the objectives

of this Plan and protect Kai Tahu ki Otago values. 61 Second, the application for resource

consent did not identify all the end-uses of water. Finally, it is a general policy to protect

and restore the mauri of all water (Clause 5.3.4, Policy 4). This policy is implemented

through a series of specific policies, including that an applicant may seek only the amount

of water actually required for the purpose specified in the application (Clause 5. 3.4, Policy

25) and policies for discharge activities.

[69] We would have also thought these considerations are relevant to the outcomes

stated in Objective 7.A.2 of the Regional Plan (above), which while noted in evidence is

not assessed.62

Review conditions

[70] The District and Regional Councils adopted different positions as to whether a

review condition can or should be imposed to respond to the adverse effects of the

activity. We do not set out their competing arguments because, again, we have arrived

at our decision for reasons other than those considered by counsel.

[71] Mr Peirce, for the District Council, described the scheme's purpose as meeting

the community's need for stock and potable drinking water.63 When losses of water from

the scheme are accounted for, in fact less than 20% of the supply ( currently) is for human

consumption and over 80% is for stock water and dairy shed uses.64 As an aside, it was

our impression all witnesses overlooked (or paid insufficient attention to) the scheme's

wider purposes. This certainly seems to be the case for Mr Cubitt who at one point

describes the purpose of the scheme as being to provide drinking water to the

community, 65 which is correct in part.

19

[72] While the matter was not fully argued, we doubt the efficacy of any review

condition where the potential adverse effects are caused by a third-person and not the

consent holder (e.g. discharge of contaminants from dairy shed washdown). This was

briefly touched upon by Ms Mehlhopt during the hearing.66

Outcome

[73] The District Council appears to supply water around the district to meet demand,

without the Regional Council necessarily being aware of the wide purposes of the Bruce

Water Supply scheme. 67 Lack of knowledge about the uses for water risks undermining

the Regional Council's functions in relation to the establishment, implementation and

review of objectives, policies, and methods to achieve integrated management of the

natural and physical resources of the region. 68

[74] The District Council's assessment of effects was not robust. This, and the fact

that the planning regime is in a state of transition, weighs in favour of a shorter duration

for the consent.

[75] Having considered Policy 6.4.19 of the operative Regional Plan, we are not

persuaded to come to any different decision to the Regional Council on duration, albeit

that in reaching this conclusion we take a different view on the effects of the activity.

[76] Returning to PC7, if the water was supplied for human use (only) and maybe

stock water consumption we would have less difficulty with the proposition that a 35-year

duration was appropriate. This is because to succeed the applicant must also

demonstrate under Policy 1 0A.2.3 that the application has no more than a minor adverse

effect on ecology and surface flow of the north branch of the Clutha River/Mata-Au.

However, the facts are that there are a wider range of uses for the scheme's water which

have not been properly assessed by the appellant.

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[77] Given the above, the appeal is declined. Costs are reserved.

For the court: