LeakBird

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California Groundwater Needs to Be Metered Statewide: Only Markets will Control the Need to Use Less Water (Aguanomics)

Jan.20, 2009 in Drought, Public Works, Water Conservation, Water Crisis, Water Industry, Water Management, Water Rights

(Jan. 20, 2009, Aguanomics)

As promised in the comments to this post, I spoke to Mike Wade, Executive Director of the California Farm Water Coalition (CFWC) about water pricing and water markets.

We had a long conversation, but here are the comments that Mike wanted on the record:

CFWC favors a “fix” in the Delta that serves the interests of the environment and water users in the Delta and south of the Delta.

Water markets already exist and should be controlled by local entities that arrange trades between willing buyers and willing sellers.

Groundwater should not be metered or monitored statewide. Local water users already know how much water they use.

Readers of this blog will know that Mike and I didn’t exactly have a meeting of the minds, and here’s why:

A Delta fix is going to have winners and losers. My opinion is that Delta farmers need to be bought out, and that south of Delta farmers (and water users) can do without Delta water.

Existing “markets” are terribly underdeveloped [the Water Bank is a joke], and the biggest trading gains are yet to be realized: There is very little trading across political boundaries in the agricultural sector.

Groundwater needs to be metered/monitored statewide to prevent “theft” of water shared by different user groups and to prevent overdrafting to replace forgone (or sold) surface supplies.

Mike is obviously in a tough place, since he needs to “serve” farm groups with different interests.

He did point out that the current shortage is resulting in land fallowing — NOT a move to higher-efficiency water use (something that the Pacific Institute predicted would happen) because it’s not profitable. I agree that this result is sensible and shortages are hurting agricultural communities (third party impacts), but I also think these changes are inevitable. (According to this article, farmers are also shifting to different crops.)

Bottom Line: In this “New World Order” (so bombastic!), there is less water in total, and everyone (ag, urban, environment) will have to do with less. The best way to reallocate less is with markets — and markets will send price signals that will help everyone decide how much they “need.”

(Original Article Here)