Angry residents say they can't believe truckloads of Yass Valley water are being sold to a nearby wind farm during drought.
However, Yass Valley Council's director of engineering, Stan Robb, says there are no concerns of water shortage.
A Facebook post about the water going to Bango Wind Farm - 30 kilometres north of Yass near Boorowa and Rye Park, bridging both Yass Valley and Hilltops local government areas - attracted 109 comments.
"I just cannot accept that Yass Valley Council would do this for a foreign-owned wind farm in the middle of a drought," Yass Valley resident Bob Jones said.
"There are farms around here that have empty dams. Fire risk is high. Where do they get off?"
There were also concerns that the water pipeline under construction from Yass to Murrumbateman would draw even more dam water.
But the council's decision to raise the Yass Dam wall in 2013 had "secured sufficient water ... to sustain current needs," Mr Robb said.
Any buyer can purchase from the council's standpipe at the current rate of $4.20 per kilolitre, the same charged to Bango Wind Farm.
"All [standpipe] users are charged the same unit rate for water as laid out in the council's adopted fees and charges," Mr Robb said.
However, the council did not know how much of its water was going to the wind farm.
"The project is using several contractors to provide water to its operations. Daily usage varies depending on prevailing weather conditions and works carried out at the time," he said.
Income generated from water sold at the standpipe goes back into the council's water fund, paying for projects such as improvements to the water supply and raising the dam wall, he said.
The water from the standpipe is potable, processed through the council's water treatment plant and supplies Yass town.
The only time water at the standpipe would be restricted was if local water restrictions were in place, Mr Robb said.
However, the council recently restricted flow from the standpipe to ensure there would be enough water for emergency operations this summer.
Some residents suggested Hilltops Council had refused water to Bango Wind Farm, forcing developer CWP Renewables to buy water from Yass Valley Council.
However, Hilltops mayor Brian Ingram said he had no knowledge of CWP Renewables contacting his council about buying water.
The Tribune has asked CWP Renewables how it is using the water and how much water will be needed to complete the project.
The company said, "as a condition of our approval by the NSW Government, we must ensure we have sufficient water for all stages of the development.
"We continue to work with Yass Valley Council on our water needs and we are also finalising arrangements to source water from outside the council area."
It's understood the majority of water is being used for dust suppression as construction at the wind farm begins.
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