The nation's largest irrigator, the Commonwealth Environmental Water Holder, (CEWH) has told a Senate Estimates hearing it has delivered 2,359 gigalitres of water to the environment in its first five years of operation.

The CEWH manages and deploys the Commonwealth's vast parcel of water, worth $1.89 billion, for environmental purposes throughout the Murray-Darling Basin.

It was allocated 2,812 gigalitres of water over the same five-year period. Of the water which was not delivered, some was lost to evaporation, some has been carried over and some will yet be used this year.

The Water Holder, David Papps, told the hearing that about 46,000 megalitres of the Commonwealth's allocation was forfeited where it could not be used, carried over or traded in the required time.

In response to questions from Queensland Nationals Senator Barnaby Joyce as to why the 46,000 megalitres couldn't have been sold back to irrigators on the temporary water market, Mr Papps said there had been barriers to that.

"Particularly since the Basin Plan has come into force, there are new rules governing the trade by the Commonwealth Environmental Water Holder, and I have to be compliant with those rules before I can trade, and I'm not yet in that position.

"I think the trade question is [now] reasonably settled, with the new provisions in the Basin Plan as it now exists, and the requirements on me and indeed every irrigator within the Basin states.

"The states have their own set of rules and regulations; as far as I'm concerned I have to address those requirements so I'm able to trade, and at the moment I don't see any [legal] changes that are necessary," he said.

Mr Papps says all 55 of his agency's staff are currently based in Canberra, although they travel widely and frequently. He says the CEWH is currently in the process of recruiting six local engagement officers who will be based in Basin regions.

"We undertake both our planning for water use and our delivery of Commonwealth environmental water in collaboration with a range of other agencies and entities, particularly the state-based agencies, with river operators and private companies," Mr Papps said.

"So the total resources available to the CEWH are less relevant; it's the collaborative work that we conduct across the Basin.

"It's fundamentally important for us to be able to demonstrate the effect that our water is having.

"Given we have a commitment and an obligation to an adaptive management framework, you can't do that without monitoring the impact of our watering activities and we have an environmental monitoring program and we're seeking to expand that."

Mr Papps says the CEWH forecasts its total water use for the current year at 1.125 gigalitres although it could be higher, with a carryover amount of 350-400 gigalitres.

"The precise nature of that number won't be known until the end of the water year and it's dependent on a number of watering activities that we're still contemplating before the end of the water year.

"Water carried over isn't lost; we would expect to use any carryover in the early stages of next year."

The Commonwealth's environmental water holdings will continue to increase as the Government continues to chase a total environmental water entitlement target of 2,750 gigalitres as stipulated in the Basin Plan, and potentially more.

Federal Department of Water officials told Estimates that the Federal Government has already acquired 1,600 gigalitres of annual water entitlement, 1,116 gigalitres of which was purchased from irrigators.

So far, 343 gigalitres have been recovered through water-saving infrastructure and efficiency projects, and the Commonwealth believes at least another 270 gigalitres can be recovered in the same way.

But Water Department officials told the hearing that even if all the projected environmental water efficiency targets are met, the Commonwealth will still have to buy back some water from irrigators in order to reach its 2,750 gigalitre target.

The Department put that figure at 280 gigalitres; approximately 200 gigalitres from the southern Basin (in effect, from NSW), and 80 gigalitres from the northern Basin.

Officials told the hearing there is a review currently underway in the northern Basin to determine which tributaries across the flood plain connect up with the Darling River and should therefore be targeted for the remaining water purchases.

At the moment, more than 60 gigalitres is slated to come from the Condamine-Balonne catchment, where Senator Joyce is a local.

In today's hearing, Mr Joyce said he's concerned about the burden that smaller irrigators and communities in that area may have to bear if the region's largest irrigator, Cubbie Station, should choose not to sell any of its entitlement.