Nature Coast Alliance spokesman Brett Stevenson said "a rushed, corner-cutting knee jerk approach will not deliver optimal outcomes and runs the risk of creating new problems down the track".

He had concerns the Berejiklian government was fast-tracking new dam projects by cutting environment protections and "green tape".

"We want to ensure the protection measures identified in the project EIS are retained and fully carried forward from the project's concept design stage into the implementation and construction phase, without being watered down, reduced or omitted because of the current moves to fast track dam developments and cut so-called 'green tape'," Mr Stevenson said.

"There will also be inevitable pressures to cut costs and corners as the project moves into the implementation and construction phase during a period of federal government budget shortfalls."

Eurobodalla Shire Council's infrastructure director Warren Sharpe said environmental protection measures would be put in place during the construction of the dam and upgrading of the river off-take and water pump station.

"As an off-river storage (3000ML dam), the project supports the water sharing plans for the Tuross and Moruya rivers by allowing extraction of water at times of higher river flows," Mr Sharpe said.

"When the rivers are lower, we will take water from the dam, leaving more water for agriculture and the river environment."

In response to whether the construction process could be fast-tracked, Mr Sharpe said: "We need the Australian Government (Deputy Prime Minister Michael McCormack) to approve the grant funding application submitted by the NSW Government for co-funding of the dam.

"We have $25.6 million in NSW Government funding of the $105 million total project cost.

"We now have a formal approval for the dam from the NSW Government. This followed submission of a development application with an accompanying environmental impact statement, which was publicly advertised as part of the approvals process."

Nature Coast Alliance warned designs should be adequate for the long term.

"Any major new water storage infrastructure needs to undergo thorough and rigorous siting analysis and design processes, including comprehensive environmental assessments to ensure minimal environmental impacts and long-term viability," Mr Stevenson said.

"The design assumptions and specifications must factor in projected long-term changes to Australian rainfall and runoff."

He said new major storage should "be only one element of a comprehensive integrated approach to water management and supply".

Other elements would include "demand management, distributed storage (e.g. rainwater tanks), more efficient local water use and reuse, together with community education to assist in achieving these objectives".

The alliance supported the need for a "secure water supply" in the Eurobodalla, but said "new major storages (i.e. dams) will not be effective unless there is sufficient rainfall in the catchments which supply the storages".

"Regular and adequate long term precipitation cannot be guaranteed as our weather becomes more variable and extreme due to the impacts of climate change," Mr Stevenson said.

In response, Mr Sharpe said the new dam meant water could be collected and stored to secure supply for many years to come.

"The new dam is being built as a 3000ML storage with foundations that enable us to increase the storage capacity of the dam to 8000ML at a future stage," Mr Sharpe said.

"The dam will be filled by pumping from the Tuross River during periods of high flow."

He said the dam was separate to the existing 4900ML Deep Creek Dam in the north of the Shire.

"Having a second dam not only provides us with the storage required to secure our water supply during periods of drought, it mitigates the risk to our community in the unlikely event that one of the dams was to be contaminated," Mr Sharpe said.

"Our water supply system is fully interconnected and allows us to move water either north to south, or south to north.

"In the interim period, we are taking water which is drawing down Deep Creek Dam (now at approximately 72 per cent capacity)."

He said there was one year of water supply left with water restrictions in place.

"We are currently at level 1 water restriction, and without significant rainfall, will need to move to level 3 water restrictions by Christmas. We are monitoring these changes weekly and will adapt our strategy to suit the circumstance."

Building of the new dam was scheduled to commence in 2020 and be complete by 2023.

Mr Sharpe said works would be put out to contract via an open tender process. The primary contractor would need to have the financial and technical capacity to deliver a project of this scale.

He said the project would create "significant" local employment during construction.

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