Critical March 1, 2022 Deadline for Preserving Non-Domestic Water Rights Nears

In 2016, British Columbia’s new Water Sustainability Act (the “WSA“) came into force and requires all non-domestic groundwater users – including farmers and ranchers, oil and gas companies, mine and smelter operators, water bottling companies, pulp and paper companies and small businesses – to apply for licences by March 1, 2022 to preserve their water rights. Existing groundwater users risk losing their historic water rights if they fail to apply before the fast-approaching deadline.

Prior to the WSA, the use of groundwater or well water in British Columbia was largely unregulated and capturing groundwater under common law was deemed a right. Now groundwater users must play by the same rules as surface users who withdraw water from rivers, streams and lakes. Under the WSA, anyone who diverts and uses groundwater for anything other than household use is required to obtain a water licence and pay water fees and rentals. A water licence is not required for “domestic purposes”, which essentially means the use of water for household purposes by occupants of single family private dwellings (for the complete definition, see section 2 of the WSA).

March 1, 2022 is the deadline to apply for a water licence for “existing groundwater users” – those who were using groundwater from a well or dugout on or before February 29, 2016 for non-domestic purposes such as irrigation, commercial or industrial use. Historical groundwater users who apply for licences before March 1, 2022, will be assigned “priority dates” based on when they first drew groundwater. This historical date is crucial because older licences get priority access to water in times of water scarcity.

Consequences for missing the March 1, 2022 deadline can be significant. First, existing groundwater users who miss the deadline will be unauthorized and must stop using water immediately. They will not be able to use the water until their licence is granted, something which can take years rather than months, given current processing delays. Further, those who miss the deadline will be treated as a “new user”. They will lose recognition of their historical date of first use and end up at the back of the queue. Their application for a licence may even be refused in water-stressed areas. In addition, anyone who continues to use water after the deadline without a licence commits an offence under the WSA and is liable to significant fines and even imprisonment, including daily fines for continuing offences. Applications made after the deadline will not benefit from the waived application fee and may require costly studies to support an application. Finally, property values could decline if there is no water licence attached or if the licence has a much later priority date.

If you are using groundwater for non-domestic purposes and have yet to apply, we recommend that you act now to secure your water rights. Further information regarding application requirements, as well as a link to the online licence application portal, are available here.

If you need assistance with your licence application or have questions regarding the impending deadline, please contact Mark Thompson, Mike Nienhuis or any member of our Commercial Real Estate Group.

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