The Rudd Government is inviting proposals from groups of irrigators in the Murray-Darling Basin wishing to sell their combined water entitlements in ways that deliver simultaneous benefits for farmers, irrigation water providers and the environment.

Minister for Climate Change and Water, Senator Penny Wong, today released the guidelines for groups of irrigators wanting to submit such proposals to the Department of Environment, Water, Heritage and the Arts.

This follows the Government's announcement in August that it would work with irrigation communities to buy out water entitlements from areas willing to move out of irrigation, with an overall price reflecting the value of water savings from closure of infrastructure such as supply channels.

"The program is part of the Government's Water for the Future plan, which includes $3.1 billion for buying back water in the Basin and $5.8 billion for infrastructure improvements and to help communities adjust to reduced water availability," Senator Wong said.

Senator Wong said the Government recognises that groups of irrigators will need to work with their irrigation water provider to develop coordinated proposals for selling their water entitlements.

"This initiative provides some irrigators with a better opportunity to sell their water entitlements and restructure their businesses.

"It gives irrigation water providers the opportunity to decommission leaky channels and pipelines - inefficient infrastructure that can be costly to maintain.

"Finally, it has the potential to return significant environmental flows and help restore the health of rivers and wetlands in the Basin."

Senator Wong said where infrastructure is to be decommissioned, real savings in conveyance water can provide benefits for both irrigators and the environment.

"One potential benefit is that where irrigation supply infrastructure is removed, irrigators may be able to negotiate reductions in termination fees charged by their water provider," Senator Wong said.

To submit a proposal, irrigators will need to work together with their water provider to determine how the costs and benefits of decommissioning infrastructure will be shared.

Detailed guidelines for developing proposals are available from www.environment.gov.au/water/entitlement-purchasing/irrigator-proposals.html or by calling 1800 218 478 for an information pack.