23 April 2025

Unused Victorian power generation water to be reallocated to Gippsland users

| Andrew McLaughlin
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West Gippsland

Water will be diverted to the Latrobe River. Photo: West Gippsland Catchment Management Authority.

The Victorian Government has announced it will divert water previously reserved for power generation to the West Gippsland region for farmers, traditional owners, and the environment.

Minister for Water Gayle Tierney said 16 gigalitres of water that had been set aside for power generation but was currently unused would be diverted to the Latrobe River in an effort to produce environmental flows to improve the health of the river and the Gippsland Lakes system downstream.

She said the Gunaikurnai Land and Waters Aboriginal Corporation would also have access to additional water for self-determined cultural uses, while Southern Rural Water would make additional water available to farmers.

The water allocation is known as the Latrobe 3-4 Bench Bulk Water Entitlement and 25 gigalitres was originally allocated in 1996 for coal-fired power generation at the Loy Yang 3 and 4 power station expansions near Taralgon.

But with the shift to other forms of power generation and the closure of several other coal-fired power stations in recent years – including Energy Brix in 2014 and the massive Hazelwood in 2017 – and with Yallourn station slated for decommissioning in 2027, the water reserve is no longer required.

READ ALSO Victoria to boost desalination plant water production in face of ongoing dry and Melbourne growth

While 16 gigalitres will be reallocated to the Central and Gippsland Region Sustainable Water Strategy (CGRSWS), the remaining nine gigalitres of the entitlement will be retained by the government to provide flexibility to respond to emerging needs in Gippsland.

The announcement comes just weeks after the government said it would boost the production of drinking water from the Victorian Desalination Plant near Phillip Island because of ongoing dry conditions across the state in recent years.

Minister Tierney said she was pleased to announce this reallocation of water and described it as a “win-win-win for Gippsland”.

“This change ensures more water supply within Gippsland to support the environment, farming, and traditional owners,” she said.

Minister for Agriculture Ros Spence added, “We are backing farmers in the Latrobe Valley by making sure more water entitlements are made available to support greater agricultural production and more local jobs.”

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