Summary

This project focused on testing Civic Ledger’s blockchain Water Ledger trading platform, which is currently at the Minimum Viable Product stage of its software development lifecycle. The pilot was conducted with horticultural irrigators within the Mareeba Dimbulah Water Supply Scheme (MDWSS) on the Atherton Tablelands in Far North Queensland.

The objective of piloting Water Ledger in the MDWSS was to research and evaluate the potential of blockchain technology to support and enhance the design and development of innovative water markets in northern Australia.

This objective included evaluation of opportunities to enhance real time price discoverability, reduce trading costs, and improve liquidity of transfers to ensure water availability through the removal of information asymmetry by creating perfect water trading and market conditions.

The project’s trading platform conducted trades in parallel with existing Water Information Systems used by the irrigators at MDWSS to collect data for analysis and determine a smart market based on blockchain technology:

• Incentivises optimisation of water allocations
• Increases market confidence
• Decreases transaction costs
• Improves data integrity.

Through this process, the project generated essential data to inform future researched aimed at optimising trading markets relevant to northern Australia’s growing agriculture industry. It also provided valuable feedback for the further development of the Water Ledger platform, including the application at a water supply scheme.

Expected outcomes

The project contributed to a better understanding of governance and market mechanisms for the efficient functioning of water trading in northern Australia.

By exploring the conditions required for the successful application of blockchain technology in water trading within the MDWSS, the pilot project directly examined the following questions:

• How can blockchain technology be used to design incentives for irrigators to optimise water allocations, leading to increased agri-economic outputs?
• Will price and market volume transparency in near to real time afforded by a blockchain enabled water trading platform lead to optimisation of water allocations?
• Can blockchain technology help design new regulatory and governance frameworks for emerging water markets in northern Australia to deliver truthful and symmetric revelation of information about water process and market volume to capture the ASEAN agricultural opportunity?