Our Questions to Alberta Environment

All water is owned by the province, and charging for water use is not allowed under the Water Act. To avoid the perception of being in conflict with the act, landowners present it as a charge for “accessing land,” which is not expressly prohibited. 

From a water allocation perspective, there is no real difference between a dugout that fills naturally from surface water runoff or fills naturally by intercepting groundwater. The most important factor for a dugout to qualify for the exemption of 6,250 cubic metres of annual diversion is that water has been captured naturally. For any dugout where water was pumped into it, all water use from that dugout requires a licence. 

Dugouts and any associated exemptions from licensing are limited to agricultural or statutory household purposes. If someone sells access to water in their dugout for non-agricultural purposes, such as for oil and gas, a TDL is required. If the sum of agricultural and non-agricultural diversions from a dugout exceeds 6,250 cubic metres in a year, the landowner also requires a licence for any agricultural use of water during that year.

They are essentially the same thing and achieve the same outcome but are implemented in two different ways. 

An in-stream flow on a licence is determined by the director as part of their decision to allocate water and provides a cut-off where a licensee is required to reduce or cease diversion.

A water conservation objective (WCO) also sets the amount of water quantity or water level established as necessary for a water body. A WCO goes through a public consultation process and must be published by the director. In-stream flow needs are science based measures developed by our department and do not require a government decision. To date, WCOs have only been established where a basin water management plan is completed. For example, in the South Saskatchewan River basin and the Battle River basin. When a WCO is formally established, the director uses that as the ‘in-stream flow need’ that appears as a condition of the licence.

Environment and Protected Areas (EPA) and the AER coordinate their management and regulatory actions when low flows are expected and escalate their interventions when low flows are observed. As a routine allocation tool, TDLs are issued when water is determined to be available and adverse impacts are unlikely. 

They are relatively low risk for managing water because they are a short-term use (one year or less), carry no priority number, and can be cancelled at any time.

When significant low flows happen, one of the first management actions is the cancellation of any existing TDLs. For critical water users during water shortage, TDLs can be an effective tool to provide an alternative source of water. For example, users could be directed to larger, more sustainable sources as opposed to smaller, sensitive streams.

To balance water uses, TDL applications are reviewed against the Surface Water Allocation Directive (SWAD) for areas with no water management plan in place or where there are no water conservation objectives or no requirements for instream objectives to be met. SWAD incorporates principles to manage cumulative water allocation, availability of water, and sustainability of allocations at a water body and watershed scale. This minimizes impacts to downstream aquatic ecosystems and habitats; and provides limits for rates of diversion from lakes/wetlands. SWAD can be found at open.alberta.ca/publications by searching for “surface water allocation directive.”

Industrial uses are not favoured. The Water Act intentionally did not create a hierarchy of purposes that are preferred or deemed better than others. Alberta views water as a resource for people, communities, environment, recreation, and social benefit as well as for generating economic opportunity and sustaining livelihoods. 

Any proposed use of water that does not cause an adverse impact to the aquatic environment, or to other existing water users, can be allocated for a beneficial purpose. Water for Life includes goals and actions for all uses (not preferential use for any activity). Water use in licence applications is justified to regulators, and proposals are scrutinized for the quantity requested, impact to the source, feasibility, and demonstrated need, and that water will not be used wastefully. Policies and practices evolve in time along with considerations informing our management approaches on the supply side and environmental protection. Specific policies, such as the Water Conservation Policy for Upstream Oil and Gas Operations (WCP) target the water demand management and set expectations for minimizing oil and gas reliance on high quality non-saline water sources.

The WCP was released in December 2020. It applies to oil sands mining operations, oil sands in-situ operations, enhanced oil recovery and cold bitumen enhanced oil recovery operations, and multi-stage hydraulic fracturing operations in horizontal wells. 

This policy serves to minimize the use of freshwater in upstream oil as operations using saline groundwater, alternative non-saline water sources such as recycled wastewater, and/or non-water technologies. It builds on the 2006 Water Conservation and Allocation policy, which saw significant freshwater use productivity improvements. The WCP includes quantitative performance measures to assess attainment of policy objectives. The performance measures include trend lines of:

• Applications for operations that use alternative sources and non-saline water.

• Allocation volumes and actual use of non-saline water;

• The ratio of non-saline water use to hydrocarbon production; 

• Allocation of non-saline water to upstream oil and gas operations as a percentage of all water allocation by basin; and 

The Water Act does not allow charging for water, so pricing is not currently an available mechanism for the government to incent behaviour change. 

In the last two decades, increasing water conservation, efficiency, and productivity (CEP) of Alberta’s major water users has largely been achieved voluntarily. For example, Water for Life set a goal of a 30 per cent increase in CEP between 2005-15, and the Alberta Water Council reported in 2017 that provincial target was met and exceeded, by measuring progress across seven major water-using sectors.

Since 2006, the upstream oil and gas sector has been directed by various policies that provide specific guidance to industry on demonstrating level of effort and alternatives evaluation toward minimizing their use of high-quality, non-saline water. The degree to which any major water users, including irrigation, municipalities, power generators, petrochemical, and pulp and paper, could have specific policies, standards, or incentives considered is one of the options being evaluated by EPA under the Premier’s mandate letter to increase water availability and water licences for water users.

The degree to which a licence is consumptive is considered as part of licence decision. For example, irrigation licences are similar to oil and gas or hydraulic fracturing because either of these uses generally result in no-return flow. It makes little sense to try to single out one industry when others have the same or similar net effect.

Alberta recognizes the importance of having access to assured water quantities for rural residents, agricultural producers, businesses, and communities. Individual landowners or occupants that do not have water provided by a water licence have ability to access and store water under specific exemptions (such as household use, exempted agricultural use, and dugouts) provided in the Water Act. 

Diverting water whether it is under an exemption or if it is from a licence or an agricultural registration, cannot provide a full assurance or guarantee of water supply, but describes which entities would have priority to access water, if it is available from a source. Household use is the highest recognized priority. 

The director, when determining whether to issue a licence, must consider the impacts to other water users and the aquatic environment. The department applies administrative practices and policies, informed by environmental flow needs science, to apply licence conditions that protect against adverse impacts. 

The Surface Water Allocation Directive provides current policy guidance for directors and is based on providing a high level of protecting aquatic environment needs in areas that do not already have specific objectives established. If a purpose for water use is intended to be prioritized or restricted – or would have quantities or sources set aside proactively for a specific user, sector, or purpose – it generally requires at least a level of political endorsement (for example, confirmation of Minister support) or requires a Minister decision (such as a Ministerial Order).

Alberta’s 130-year-old management system directs that under standard circumstances, water use is cut back based on conditions of an individual licence (such as an in-stream objective condition) and based on licence priority. 

Temporary Water Diversion Licences (TDLs) are generally the first to be suspended or cancelled because they have no priority. If there is a priority call, senior licences (based on licence priority date) are entitled to divert water ahead of junior users, regardless of purpose.

The recent water sharing agreements established in southern Alberta reflect basin-specific context for each of the sub-basins. The largest users with most of the allocated water are signatories to agreements. Water sharing agreements are designed to be proactive, risk-based, and agile enough to be adjusted in real time. 

In broad terms, the agreements call for the following: 

• Participating municipalities will reduce water consumption by between five and 10 per cent.
• Participating industry will use only the minimum volume of water practical to maintain safe, reliable operations. 
• Participating irrigation districts will use less water and allow other users to get their water first, before using the remaining water available for licensed use. 

To ensure the water conservation efforts of southern Alberta’s largest water users have maximum effect, smaller water licensees have been asked to take the same water conservation actions. This request was outlined in a letter from the Minister to more than 2,000 small water licence holders in the South Saskatchewan River Basin.

Interim water reuse opportunities are encouraged and are occurring, but to support enabling water reuse and remove current barriers to alternative water sourcing options across all sectors (including oil and gas), Alberta Environment must consider regulatory and legislative changes to the Water Act. This is another action being evaluated under the Premier’s mandate letter to increase water availability and water licences for water users.