What Landowners Need to Know About the Future of Water in Hawke’s Bay: Plan Change 9
Written by Kelly Henderson
Originally published in The Profit.
Water is central to Hawke’s Bay’s agricultural and economic success. It sustains crops, reinforces land values and drives investment in one of the New Zealand’s most productive agricultural regions. However, a far-reaching new policy—Plan Change 9 (PC9)—is set to dramatically reshape water rights across the TANK catchments (Tutaekuri, Ahuriri, Ngaruroro, and Karamu). PC9 changes the way water is valued, managed and accessed and its impacts will be immediate and significant for landowners, agribusinesses and investors.
As part of the Hawke’s Bay Regional Plan, PC9 – publicly notified in May 2020 – puts the National Policy Statement for Freshwater Management (NPSFM) into action through locally enforceable rules. Its aim is to correct long-standing overuse of water and ensure regional practices meet national expectations for sustainability. The policy has already triggered legal scrutiny, with 16 appeals expected to be heard in the Environment Court in early 2026.
At the centre of the policy is what’s known as a “sinking lid” – a rule that locks in water allocations based on past use and gradually reduces the total amount available. In practice, this means:
- No new water is being allocated -unless you invest in costly water storage solutions.
- Use it or lose it: If you didn’t fully use your allocation between 2010 and 2020, you’ll likely forfeit the unused portion.
- Transfers are highly restricted: Unused water can no longer be freely traded or reassigned as it was in the past.
Put simply, if you haven’t been using all the water you were allowed, you’ll likely lose the unused portion – and once it’s surrendered, it’s gone for good. No top-ups, no transfers.
The key tool in this shift is the concept of Actual and Reasonable Use (ARU), which determines how much water a consent holder can retain. ARU is defined as the lesser of:
- The highest annual water use in the 10 years before May 2020 (based on meter data); or
- A modelled estimate based on crop type and efficiency using the IRRICALC tool.
If your property had gaps in metering or you simply didn’t use your full entitlement, you’re likely to get a reduced allocation. In some cases, you may be required to challenge the ARU through a publicly notified consent process, which can be time-consuming and complex.
More than 1,000 expired water permits remain in use, but they’ll only stay valid until the Hawke’s Bay Regional Council finishes processing replacements. Many landowners wrongly assume these permits will be automatically renewed – but that’s not the case.
HBRC is in the process of sending letters to water users outlining their ARU estimates. You will be asked to either confirm the estimate or contest it – typically by 31 May 2025.
If you believe your ARU doesn’t reflect your real needs or historical use, you can challenge it. Valid grounds include crop rotation practices, staged development, inaccurate or missing water meter date, or temporary constraints (e.g. system breakdowns or consent conditions). A variety of reports and information will be required to support your case including evidenced historical water meter records and a recalculated IRRICALC model to better reflect your current and intended use.
PC9 is already reshaping the business landscape in Hawke’s Bay. Properties once valued for irrigation potential are now facing uncertain water access – particularly in heavily over-allocated areas like the Heretaunga Plains and Ngaruroro River. For unirrigated land, securing new access is unlikely without investing in large-scale storage solution.
Key implications include:
- Land value: Irrigation potential remains a key driver of property value.
- Business planning: Growers may no longer have enough water to sustain high-value crops in dry years.
- Property sales: Buyers will need to conduct far deeper due diligence around water consents, ARU calculation and future risks.
Given appeals before the Environment Court, the final outcome is uncertain, the implications of PC9 are complex, far-reaching, and evolving. Understanding your water entitlement – particularly under the ARU test – is critical. Decisions made now may significantly impact property value, operational viability, and future development potential.
Bramwell Bate Lawyers may be able to assist you with the legal and strategic aspects of Plan Change 9. If you’re considering how to approach an ARU estimate, a consent renewal or future water management planning, our team can offer guidance to help you assess your next steps.