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Water allocation is the process by which the Government of Alberta grants licenses for water use. Under this system, municipalities, private companies, individuals and other users can apply for a license to withdraw a certain amount of water from a water source each year. In the South Saskatchewan River Basin, where there is a Water Management Plan in place, existing licensees can voluntarily transfer their allocation to other licensees or new users subject to review by the regulator.

The legislative framework for the current water allocation system is Alberta’s Water Act, which has evolved over the last 100 years to address the changing use of our water supplies. However, increasing demand, decreasing supplies, and the ongoing changes to the environment driven by climate change have placed considerable strain on the allocation system, especially in southern Alberta.

Graphic Source: Alberta Energy Regulator: Water Use Report, Available at

AUMA policy on water alloction

Given its large importance, water allocation has been a focus of AUMA’s water policy development. After significant member engagement, it became apparent that issues around how water licenses are granted or transferred cannot be solved without addressing broader water management concerns such as the lack of:

  • Integration between land and water use decision making
  • Incentives for collaboration or conservation
  • Transparency around the impact of water use by the oil and gas sector, particularly focusing on hydraulic fracturing
  • Recognition of the true value of water
  • Accessible information on water use, quality, flow variability, groundwater and other data required to support sound decision making.


To improve the ability of the current allocation system to support improved water management, AUMA's policy also recommends that the Government of Alberta:

  • Confirm in legislation that water cannot be allocated out of province: make sure that only Albertans can control Alberta water
  • Build greater transparency into the financial and technical details around transfers (who purchased what volume at what price for what purpose) and performance assessment into the allocation system
  • Realign the allocation system to take care of basic human health and hygiene and the environment first, and then let the market manage economic needs
  • Hold in reserve allocation room for population growth. Municipalities are a small part of water use: the province can protect future growth without significant changes to the system
  • Ensure that the use of Holdbacks does not penalize municipalities for administrative transfers
  • Develop a plan under the current system for the next big drought so that Albertans are prepared and know in advance what actions can be taken, how responsibilities will be shared, and how regulatory decisions will be made during times of hardship
  • Require anyone applying for an additional licence or to buy or sell an existing licence to have a Water, Conservation and Efficiency Productivity Plan in place that demonstrates best practices are being used to minimize water use

AUMA's policy is available for download

Information on water allocation

For more information on water allocation in Alberta, choose one of these: