Water sector solutions to the biodiversity crisis

World Environment Day is a moment to inspire awareness and action for protecting our natural world. To mark the day, we’re highlighting this feature from the latest edition of Current, which explores how water utilities, scientists and engineers are working to restore ecosystems, protect species and drive towards a nature-positive future.

Ten years ago, the UN Convention on Biological Diversity highlighted a crucial intersection between water management and biodiversity. Its Water and Biodiversity report called on the sector, including potable water supply, wastewater treatment and stormwater management, to not only mitigate its impact on ecosystems, but also harness the benefits biodiversity provides.

The message was clear: water security and conservation could – and should – go hand in hand.

In 2025, this principle is no longer a lofty ambition, but the starting point. Australia’s water sector has moved well beyond regulatory obligations, embracing bold innovations to reverse species loss and regenerate ecosystems. From rewilding waterways to integrating nature-based solutions, areas of the water sector are actively shaping a future where water management drives environmental renewal.

Water professionals are driving biodiversity conservation through habitat creation, endangered species protection, and collaborative strategies for ecological resilience. With biodiversity loss accelerating under climate change, the challenge is clear: how can the sector lead the charge toward a nature-positive future?

Different reasons, same goal

Biodiversity and healthy ecosystems are critical to the water sector’s ability to deliver safe and affordable services. As some of the country’s largest landholders, water utilities manage vast areas of biodiverse land – including protected catchments, treatment wetlands and riparian zones.

These natural systems are essential for water extraction, treatment and discharge, making utilities both stewards of and stakeholders in environmental health.

Yarra Valley Water Senior Engineer Natalie Hackett said water utilities collectively manage over a million hectares in Australia, including protected catchments that safeguard drinking water quality, riparian corridors and land surrounding treatment plants. This gives the sector a unique opportunity to enhance biodiversity at scale.

“Unfortunately, the World Economic Forum lists water management and its use as one of the top 10 threats to biodiversity, so we’re also part of the problem. But we have an opportunity with the available land at many of our facilities, and the availability of recycled water, to create climate resilience,” she said.

Urban Utilities Principal Environmental Scientist Cameron Jackson agrees. He believes it was about 10 years ago that his organisation realised how dependent it was on healthy ecosystems to keep their services affordable.

“We essentially extract all of our fresh water from Mother Nature, which drives very low-cost drinking water, and then at the other end, we put most of our treated effluent into the waterways, and rely on those waterways to safely process that residual pollution,” he said.

“If we have to look at other methods, it’s going to be a lot more expensive. That’s why we have to have a role in biodiversity conservation and ecosystem protection.”

For Hackett, the drive to halt biodiversity loss goes beyond wishful thinking – healthy ecosystems are fundamental to sustainable water management, and restoring them supports environmental and cultural outcomes.

“In 2024, I presented a paper at the International Water Association Congress in Canada, highlighting the opportunities and benefits for water utilities in prioritising biodiversity,” she said.

“There’s still work to be done to shift the perception of biodiversity from a ‘nice-to-have’ or co-benefit to a key priority with tangible advantages. Endemic species are part of a nation’s culture, but there’s little distinction made between a nation’s loss of biodiversity and the impact it is having on Traditional Custodians. We have a great opportunity here. Part of enabling caring for Country is to help restore that Country, so the Traditional Custodians can then manage that land on everyone’s behalf.”

Water in all its forms

While the water sector’s role in providing drinking water and wastewater services is well known, its impact on biodiversity extends beyond these to include the management of stormwater, which directly affects the health of waterways and the species that depend on them.

Professor Tim Fletcher, part of the Waterway Ecosystem Research Group at the University of Melbourne, said it wasn’t until the 1990s that the link was made between runoff from urban areas and the degradation of streams, and even longer before the significance of the problem was realised.

“It’s been shown in research, here and in the US, that if even just half a percent of a catchment is an impervious area directly connected into the stream, there will be substantial degradation and loss of many of the species,” he said.

“One of the delays in tackling the issue has been that we initially thought, ‘Oh, it’s just a pollution problem’. Yes, there is pollution generated on these impervious surfaces, but even if that water was clean, you’re still getting degradation, because the amount and the timing of that water is completely changed.”

Fletcher said there was research that showed how the water in many streams is decades old; the natural environment acts as a sponge and releases water gradually. Urbanisation removed this process, creating peak flows that can wash away species in the waterway, as well as erode their habitat.

Regenerating ecosystems

Hackett’s project involves using recycled water to create more than 35 hectares of woodland and wetlands around the Upper Yarra Sewage Treatment Plant, aimed especially at creating habitat for endangered Helmeted Honeyeaters and Leadbeater’s Possums. Recycled water from the plants will support swamp forest habitat.

Working with Traditional Custodians, Greening Australia and Zoos Victoria, the site will become not only a rewilding site, but also contribute to wildlife corridors that give nature space to adjust to climate change.

“We are evolving in our thinking, and our action on climate change cannot be uncoupled from biodiversity loss. They are deeply intertwined,” she said.

“This project is a great example of where we are not only enhancing biodiversity, but we’re sequestering carbon and mitigating the effects of climate change, as well as supporting endangered species.”

Urban Utilities bought a farm adjoining its Helidon Sewage Treatment Plant that was a repository for its recycled water and is turning it into a blue gum forest. Almost 3000 seedlings have been planted on seven hectares in the first phase of the project.

“We can irrigate that sustainably for 25 years, and we have enough land to be able to replicate the forest up to about 33 hectares, which gives us about 60 to 80 years of servicing,” Jackson said.

The property adjoins 100 hectares of existing, conserved koala habitat. “It’s operationally cheap; after the first five years, the trees tend to look after themselves. It is a great biodiversity outcome.”

Large-scale examples of biodiversity-focused wastewater management also exist, such as Melbourne Water’s Western Treatment Plant, where treatment wetlands now provide critical habitat for thousands of waterbirds.

Beyond gumboots and spades

Biodiversity projects don’t all involve planting trees. Many reflect innovative uses of technology to save our natural environment. Fletcher is working on a system of smart water tanks and urban lakes to protect platypus habitat in Monbulk Creek in Victoria.

“We’re building a network similar to that of solar energy, where you give excess energy back to the grid,” he said.

“Our software will control hundreds of water tanks so that when enough rain is predicted to make tanks overflow, it will start a controlled release, reducing the risk of flooding and subsequent erosion of waterways. And when there is very little water in the creek, we will take a pre-agreed amount out of those tanks to provide enough water to support platypus habitat.”

The aim is to have 300 households connected, as well as three to four large urban lakes, to provide a greater ability to regulate the flows provided to the creek. In Queensland, Urban Utilities wanted to learn more about its receiving environment as part of its environment strategy.

“Previously, we’ve relied on the regulator to tell us what to do. Now we have a digital twin of the whole Brisbane River and Moreton Bay which we use to do all of our environmental planning,” Jackson said.

“It is helping us to better understand the impacts our sewerage assets might have on local biodiversity and guides us on the best use of our dollar for environmental improvement. It’s taken us five years to build, but now it gives us a science-based platform to make investment decisions that benefit the environment.”

A holistic approach

Jackson believes one of the main challenges for the water sector is rethinking the role of wastewater treatment plants – not just as infrastructure for waste processing, but as active contributors to local ecosystems.

“The light on top of the hill is urban ecological mutualism. How do we use a wastewater treatment plant to enhance local aquatic ecosystem services?” he said.

“Maybe it’s releasing selected nutrients into the natural system at the right time to stimulate phytoplankton growth and the higher food chain. It’s about how we can fine-tune and optimise existing water sector infrastructure in a nature-positive way.”

In Fletcher’s ideal world, developers would be incentivised to use nature-based solutions to support biodiversity.

“My dream would be for all stormwater to be used as much as makes sense at the source, so people are harvesting it, using it and integrating it into their water supply system,” Fletcher said.

“We’d be able to manage flows into streams so they’re close to natural, and that harvested stormwater is transported back up to a treatment plant and into one of the existing reservoirs and be treated to potable. And in the streetscapes, water is filtered back into the ground at the natural rate to support vegetation.

“If you think about it, why does a water utility exist? The boringly obvious answer is to supply water and water services, but actually it’s more profound than that.

“They are there to improve the life of society in their area; to provide health, to provide recreation, and if you can do so in a way that’s preserving a really nice environment, you’re not just protecting biodiversity, you’re protecting the community.”