BEFORE THE SPECIAL TRIBUNAL FOR THE NGARURORO AND CLIVE .
BEFORE THE SPECIAL TRIBUNAL FOR THE NGARURORO AND CLIVE RIVERSWATER CONSERVATION ORDERAT NAPIERIN THE MATTERof the Resource Management Act1991 (“Act”)ANDIN THE MATTERTHE SPECIAL TRIBUNAL:of a Special Tribunal appointedunder s202 of the Act to consider anapplication for a Water ConservationOrderRichard Fowler (Chair)Alec Neill (Member)Dr Roger Maaka (Member)Dr Ngaire Phillips (Member)John McCliskie (Member)STATEMENT OF EVIDENCE OF XAN HARDING ONBEHALF OF THE HAWKE’S BAY WINEGROWERS’ ASSOCIATION& GIMBLETT GRAVELS WINEGROWERS’ ASSOCIATIONSTAGE 2 MATTERS25 JANUARY 2019Counsel instructed:J D K Gardner-HopkinsPhone: 04 889 2776james@jghbarrister.comPO Box 25-160WELLINGTONSolicitors acting:Alison McEwanPhone: 06 835 8939Fax: 06 835 3712PO Box 446NAPIER
1Qualifications and experience1.1My full name is Xan Harding.1.2I am a director and water spokesperson of the Hawke’s Bay Winegrowers’Association (“HBWG”). I am authorised to give evidence on its behalf.1.3I hold a Bachelor of Horticultural Science (Hons), a Graduate Diploma inBanking Studies and am currently enrolled in a Master of EnvironmentManagement programme (Massey). I have been a grapegrower in Hawke’sBay (Haumoana and Bridge Pa) since 2000.1.4I held the role of deputy Chair of HBWG from 2006 to 2018, prior to thatPresident of Hawke’s Bay Grapegrowers’ Association Inc. as well as being analternate Director of New Zealand Winegrowers and NZW Board FinanceCommittee member for a number of years and a current SustainableWinegrowing New Zealand (“SWNZ”) committee member. I resigned frommy HBWG deputy Chair role in 2018 to avoid any conflict with my newspokesperson role with the Te Mata Peak Peoples’ Track Society butotherwise continue to represent HBWG on RMA matters.1.5I was HBWG’s representative on the TANK group since its inception in 2012and prior to that its representative in the Tuki Tuki PC6 process, as well asthe HBRC Land and Water Management Strategy and various other regionalcouncil and regional TLA processes since circa 2004 (all unpaid apart fromsome modest TANK attendance fees).1.6My evidence supports the submission by Hawke’s Bay Winegrowers’ andGimblett Gravels Winegrowers’ Associations (“Winegrowers”) on the draftWater Conservation Order (“WCO”) for the Ngaruroro and Clive Rivers. TheWinegrowers oppose any WCO in regards to its application to the LowerNgaruroro River.2Scope of evidence2.1The purpose of this evidence is to summarise the Winegrowers’ overallposition on the WCO and provide an overview of the Winegrowers’ evidencewhich will be put to the Special Tribunal at the Stage 2 Hearings in relation tothe Lower Ngaruroro.2.2This evidence addresses the following matters:1
ithe Winegrowers’ overall position on the WCO and its’ opposition toa WCO in the Lower Ngaruroro;iiwine industry sustainability; andiiithe current and future needs of the Hawke’s Bay wine industry.3Executive summary3.1The Winegrowers consider that the Applicant has not made their case thatthere are outstanding values in the Lower Ngaruroro that warrant theprotection of a WCO;3.2Despite considerable efforts on the part of Winegrowers, the Applicant hasfailed to address a number of matters of detail in draft Order which theWinegrowers consider are incompatible with a workable Order in the LowerNgaruroro3.3The TANK Plan Change should be the preferred planning instrumentgoverning the Lower Ngaruroro as it provides for all significant values in thecatchment and does so in a more effective and efficient way than a WCOwould.3.4Sustainability and the SWNZ scheme area central pillars of the New Zealandwine industry, holding members to high and continuously improvingenvironmental standards.3.5S.212 (b) of the RMA requires the Tribunal to have regard to the current andfuture needs of the Hawke’s Bay wine industry, those needs are not providedfor by Version 3 of the draft Order, especially in relation to certainty forexisting discharges (both point-source and diffuse), maintenance of existingpoints of direct surfacewater takes and future access to high-flow storage.3.6Approximately 97% of wine sector water use is for irrigation/frost protection,approximately 95% of irrigation is by the most efficient drip method, vineyardsuse approximately 1/3rd the amount of irrigation per hectare as other irrigatedcrops and have the lowest diffuse discharge profile of any intensive land-useactivity.3.7Paradoxically, whilst vineyards have a low overall environment footprint, thewine sector stands to be most affected by controls on water quality and2
quality, as vineyards generally occupy the lightest soils closest to rivers,including the Ngaruroro.3.8Availability of high-flow water storage will be critical to the future developmentof the Hawke’s Bay wine industry, particularly in the elevated plateauxadjacent to the Ngaruroro.3.9The wine industry is increasingly seen nationally as a future low-carbonlanduse alternative to pastoral farming and this aspect deservesconsideration in having regard to the wine industry’s future needs.3.10The high-flow water storage provisions of the TANK plan change are pivotalin achieving a rebalancing of the extractive uses of water in the Ngarurorocatchment towards greater use of high-flow storage and lesser reliance ongroundwater resources, whilst improving catchment environmental valuesand providing for sustainable growth in primary production.4Overall Position on the WCO4.1Recapping the Winegrowers’ Stage 1 evidence, based on discussions withFish & Game NZ in December 2015 and verbal assurances received fromthem about lack of impact on land-users, the Winegrowers have supportedsome form of WCO in principle but stressed that that the ‘devil would be inthe detail’. In particular, the Winegrowers supported a WCO in the UpperNgaruroro – provided that the effects on the needs of the winegrowers’industry are not significantly affected in the Lower Ngaruroro, and thatconsideration is given to allowing some water storage in the tributaries of theUpper Ngaruroro. The Winegrowers in their submissions opposed the WCOin respect of the Lower Ngaruroro – and continue to do so, for the reasons tobe given in evidence and legal submissions.4.2The Winegrowers were, and continue to be, conscious of:a a general appreciation of the near-natural state of parts of the uppercatchment and community expectations for it to be upheld;b the NPSFM imperative to ‘maintain or improve’ freshwater, and awarenessof Ngati Kahugnunu’s views thereon;c the implications of ‘King Salmon’ in giving planning policy greater ‘teeth’;3
d the wine industry’s own sustainability values; ande the role of the TANK process and ensuing TANK plan change in addressingthe community’s interests in the Ngaruroro River.4.3Since the completion of the Stage 1 hearings, the Winegrowers haveexpended considerable effort and financial resources in continuing to engagewith the Applicant in the spirit of co-operation over the Draft Order, withlimited effect. To assist the Tribunal, the Winegrowers filed a memorandumdated 28 September 2018 registering ongoing concerns about Version 3.Regretfully, the Applicants have chosen to ignore many of the Winegrowers’concerns with the Draft, which the Winegrowers consider are incompatiblewith a workable Order in the Lower Ngaruroro.4.4Whilst the Winegrowers continue to support some form of WCO over theUpper Ngaruroro, we oppose the current Draft Order and any Order inrespect of the Lower Ngaruroro. The key reasons are that:athere are no nationally-outstanding values in the Lower Ngaruroro thatrequire the protection of an Order – the Applicants have not made theircase in this regard;bthe WCO in respect of the Lower Ngaruroro will have little practical effectin protecting the values that do exist, but will have significant impacts onthe current and future needs of the winegrowing industry. In simple terms,the significant costs of the WCO will far outweigh the benefits (little ornone); andcthe TANK Plan Change should be the preferred planning instrumentgoverning the Lower Ngaruroro as it provides for all significant values inthe catchment and does so in a more effective and efficient way than aWCO would, because TANK addresses all significant values in anintegrated manner and by reference to one set of rules. Introducing aWCO in the lower would add an extra layer of regulatory complexity whichwould need to be referenced (and likely contested) on an ongoing basisbut without adding any environmental protections that are not alreadyincluded in the TANK plan change.4
5Needs of the Sector in terms of S. 212(b)5.1The Winegrowers’ Stage 2 submissions focus on describing the current andfuture needs of the wine industry so that the Tribunal may take this intoaccount. To do so, the Winegrowers’ evidence focusses in particular onneeds as they relate to irrigation, discharges and tourism through thefollowing evidence and submissions:DomainWater Use –Irrigation andFrostSubmitterMark Krasnow (Expert)Daniel Watson, CraggyRange WinesAdam Evans,Constellation BrandsGraham Bartleet, bilityFuture NeedsPeter Callendar (Expert)SummaryCritical reliance of Hawke’s Bayvineyards on water for economicproduction and to avoid vine death onlight soils.Hawke’s Bay irrigation good practice,water use efficiency and innovations.Description of Te Tua frost protectionsystem design/operation, explanationof role that water plays cf. frost fans.User perspective on role of storagefor frost protection and irrigation(Crownthorpe)Implications of draft Order provisionsfor winery direct discharges.Xan Harding (thesesubmissions)Fabian Yukich, VillaMariaOverview of diffuse effects ofviticulture.Current and future importance ofHawke’s Bay as NZ’s second-largestwine region from a nationalperspectivePeter RobertsonBoutique winery & wine ischarge water tosustain an industry.Role of sustainability in NZ wineindustry in relation to water.Opportunities for future expansion ofHB wine industry & implications forwater needs.Planning considerations for wineindustry needs and assessment of therelevant planning instruments.Overall legal representation.Xan Harding (thesesubmissions)Xan Harding (thesesubmissions)PlanningMark St.ClairLegalJames Gardner-Hopkins(barrister)Alison McEwan(instructing solicitor)5
6Wine Industry Sustainability Programme6.1The New Zealand wine industry is recognised internationally for globalleadership in its national wine sustainability programme (“SWNZ”), whichoriginated in 1996 and now encompasses 98% of the total New Zealandvineyard area.6.2SWNZ is a voluntary, externally-audited programme based on continuousimprovement and adherence to standards and guidelines issued by OIV(International Organisation of Vine and Wine). It covers 9 pillars – Soil, Air,Water, Biodiversity, People, Energy, Byproducts, Pest & DiseaseManagement and Business,6.3An understanding of the SWNZ programme is essential in considering thecurrent and future needs of the Hawke’s Bay wine industry. As a member ofthe New Zealand Winegrowers Inc. committee overseeing SWNZ, I am wellinformed to assist the Tribunal in this regard.6.4Attached at Annexure 1 is the SWNZ water sustainability pillar document,which summarises the requirements and expectations on SWNZ members.The document encapsulates these in the statement that “it is vital that winebusinesses minimise water use and protected [sic] the purity of waterways toensure our supply remains clean and sustainable in the future”.6.5Attached at Annexure 2 is the SWNZ National Water Use Report 2018,compiled by independent consultants from the latest annual informationsubmitted by SWNZ members. This provides a useful snapshot of vineyardand winery water usage.6.6Extracted from the Water Use Report and reproduced below are some keystatistics in relation to Hawke’s Bay. Overall the Report shows that 77% ofthe Hawke’s Bay vineyard area (3502ha) relies on irrigation and that theamount of irrigation used in the sector varies by region, soil type and season.To produce quality wines, grape growers must actively manage and monitortheir water usage, both as a matter of viticultural necessity and under theterms of SWNZ membership.6
6.7Note that annual water usage in the above graphic is quite variable, withyear-to-year variation within a region due primarily to the amount and timingof seasonal rainfall. Variation between regions is primarily due to regionaldifferences in varietal mix, soil type and windrun.6.8In the above graphic, the ‘Very light – Stoney’ soil requiring the most irrigationwould be found principally in areas of very recent soil close to rivers and inparticular in the Gimblett Gravels subregion. This illustrates a paradox of7
grapegrowing that the lightest soil often most suitable for grapegrowing (andunsuitable for much else agricultural) are generally located closest to rivers,supporting landuse which uses approximately 1/3rd the water of other irrigatedcrops but which by virtue of its location is most likely to be affected bycontrols over rivers and by groundwater connectivity rules.6.9As represented in the figure above, nationally only 3% of wine industry wateruse is by wineries, the rest is for irrigation and frost protection (separatefigures are not available for the Hawke’s Bay region but are unlikely to differmarkedly from the national average).6.10The above figure shows that nationally over 85% of vineyards employ specificsoil moisture monitoring techniques, either with their own equipment or via anadvisory service. The figure also demonstrates that multiple techniques arethe norm, combining objective data with practical viticultural experience.Separate data is not available for Hawke’s Bay but would be expected to besimilar.8
6.11As noted in the SWNZ water pillar at Annexure 1, 95% of the SWNZ memberirrigated area employs undervine drip irrigation, which is current best practicewith an efficiency of approximately 90% in a well-maintained system.7Diffuse Effects of Viticulture7.1Information by way of Powerpoint presentation was provided to the Tribunalduring the Stage 1 hearings on the modelled leaching profile of Hawke’s Bayvineyards and this is repeated below for the Tribunal’s convenience. Onemember of the Tribunal queried why Hawke’s Bay’s P leaching resultsexceeded the national average, with no answer available at that time. Myunderstanding on subsequent enquiry is that this is due to naturally higher Pcontent in some of the Hawke’s Bay soil parent materials. In other words, thisis a natural state, rather than one resulting from any industry practices.7.2Overall, viticulture should still be seen in the context of the N & P leachingnumbers being at the very low end of the spectrum for intensive horticultureand comparable or better than the low end of extensive agriculture.9
7.3Whilst SWNZ does not currently include Overseer or similar leachingassessments, a SWNZ project is underway with a view to achieving FarmEnvironmental Management Plan (“FEMP”) equivalency on a region-byregion/catchment-by-catchment basis, including the use of property-scalenutrient leaching modelling. Such an approach was attempted by SWNZ inthe Tuki Tuki catchment but failed due to drafting constraints in the RRMP.The draft TANK plan change seeks to remove such constraints andincentivises FEMP equivalence via either industry or catchment collective.7.4The Winegrowers support the concept of FEMPs for environmentalcompliance but note that as grapegrowing starts from a very low nutrient baseand generally in Hawke’s Bay does not involve regular application of any solidfertilisers other than at vine establishment, opportunities for grape growers toreduce their nutrient footprint are quite limited.7.5Moreover, in light of the modest nutrient footprint of grapegrowing, theWinegrowers find it illogical and objectionable that the draft WCO would puttheir farming activities in breach in the event of an overall breach of waterquality standards not of our industry’s making.8Future Needs of the Hawke’s Bay Wine Sector8.1Whilst it is not possible to predict the future growth of the Hawke’s Bay wineindustry with any certainty, it is possible to draw some broad conclusionsabout the likely general pattern of development (ie what is more likely tohappen than not, unless unduly constrained, say, by a WCO).8.2In recent years the official figures for Hawke’s Bay vineyard area haveplateaued around 4800-5000ha. However, underlying that figure is significantchange in the vineyard mix, with mainly smaller uneconomic sites on heaviersoils being converted to apples, whilst at the same time there has beengrowth in the large corporate vineyard area particularly in the Crownthorpesubregion which is not yet reflected in the official statistics. Recent new largeinvestments in vineyards (Delegat, Apatu) and new wineries (Villa Maria,Delegat) indicate overall growth in the Hawke’s Bay industry and acommitment to ongoing growth from some of the largest Hawke’s Bayplayers. While Hawkes Bay is still the second largest wine region in NewZealand, its 4,800 Ha of grapes accounts for only 12% of the national grapeplantings, with Marlborough accounting for 68% of the area and the remaining10
20% split between 6 other regions (see graphic below, source – NZWinegrowers’ 2018 Annual report).8.3The rate of growth in the Hawke’s Bay vineyard area has been constrained inrecent years by industry economics, lack of available land, lack of availablegroundwater, the failure of the Ruataniwha water storage scheme, andindustry national investment priorities being focussed on planting up the lastavailable land in Marlborough.8.4A key factor in how the wine sector may grow in the future will be theoutcome of the TANK plan change. While the final form of what is ultimatelyadopted cannot be predicted with certainty, the “starting point” of anadvanced draft now has some clarity. Given the lengthy collaborative effortsin developing the draft, there may well be fewer changes through thehearings processes than with other plan changes.11
8.5In any event, I have been closely involved in the TANK process, and considerI have a good “working” understanding of what the draft TANK plan change isintended to achieve.8.6As drafted, the TANK plan change is expected to cap groundwater resourcesfor irrigation at something approximating actual usage in the most recent dryyear (2012/13), representing approximately 50% of ‘paper’ allocations.Individual consent-holder seasonal allocations are expected in some cases tofurther restrict water availability as a result of the application of a newallocation model (‘Irricalc’) and due to reallocation of some of thegroundwater resource to lowland stream augmentation schemes, which areproposed to improve lowland stream conditions. In addition, it is possible thata proportional scaling back of consent volumes may be required to fit withinthe proposed groundwater allocation limit.8.7In my evidence for the Stage 1 hearings I included a figure illustrating theexpected TANK plan change seasonal water allocations for land-usescomparable to grape growing, showing that the expected modelled waterusage (and hence allocation) for grapes is no more than 1/3rd that of otherirrigated land-uses. The figure is reproduced below for the Tribunal’sconvenience.12
8.8The additional constraint on groundwater resources is intended to bemitigated at least in part in the TANK plan change by providing for anincrease in the high-flow allocation limit for direct water takes in both theNgaruroro and the Tutaekuri Rivers, with such water to be available both forout-of-stream storage on individual properties as well as communityschemes, and for use in augmentation of both lowland streams andgroundwater.8.9In order to achieve this rebalancing of the extractive uses of water in theTANK catchments towards greater use of high-flow storage and l
the New Zealand Winegrowers Inc. committee overseeing SWNZ, I am well-informed to assist the Tribunal in this regard. 6.4 Attached at Annexure 1 is the SWNZ water sustainability pillar document, which summarises the requirements and expectations on SWNZ members. The document encapsulates these in the statement that “it is vital that wine
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