Farmers in the lower Colorado River basin are getting a cheaper deal on water than cities are, according to a new report by the UCLA Institute of the Environment and Sustainability and Natural Resources Defense Council.
The study looked at the wholesale cost of water paid by large water districts and municipal utilities in the Lower Colorado River Basin states including Arizona, California and Nevada, that buy or redirect more than 10,000 acre-feet of water a year from the Colorado River and major drainages of the Sierra Nevada.
The report analyzed 217 water transactions involving 172 distinct water districts or utilities and 41 different suppliers, representing an average of 16,400,801 acre-feet of water per year which revealed wide discrepancies in water prices ranging from zero dollars to $2,800 an acre-foot.
“We wanted to look at this because there’s long been a basic understanding that agricultural districts and suppliers may be paying less for their water than municipal entities or cities,” said Noah Garrison, researcher with UCLA.
He said the results were shocking.
“That there are large volumes of water, in fact vast volumes of water being provided through the Bureau of Reclamation on the Colorado River system for literally zero dollars an acre foot, to primarily agricultural districts but to municipal wholesalers as well,” Garrison said. “This is in contrast to municipal entities which average closer to $500 an acre-foot.”
The study came to three conclusions, the first being that water obtained through federal projects is cheaper than water obtained through state infrastructure or from other surface water projects and sellers.
According to the report, “The price paid by wholesalers, districts, and utilities reflect only the cost for delivery of the water– the capital costs of the conveyance infrastructure or the cost for operations and maintenance– and even then the price remains inexpensive.”
The actual water from the Colorado River and streams is nearly free.
The study also determined that agricultural districts pay less than municipal districts for the same amount of water due to the “overwhelming” amount of nearly free water provided by the federal government to agricultural districts under surface water rights or established delivery contracts.
It was also discovered that districts in California pay significantly more for water than in Arizona and Nevada, the highest being between San Francisco and San Diego.
“I think the surprise is simply that these systems are based on contracts and pricing structures from 60,80,100 years ago, that we are still relying on despite the fact that conditions have entirely changed in the southwestern United States and certainly for the Colorado River where we’re facing a shortfall of two to four million acre-feet per year,” Garrison said.
The report offered a series of recommendations for the Bureau of Reclamation including a surcharge to federal water as a way to provide funding for infrastructure improvements as well as the development of a centralized water database which to help-inform water-management decisionmaking.
“We can’t operate in a system that is seeing increasing scarcity and really is in crisis at this point, when we’re not providing any signal that the water has value or is limited in any capacity,” Garrison said.
He said that he hopes that the price of water is considered during ongoing discussions of Colorado River water throughout the Basin, as current operating agreements are set to expire next year.
“This is on a system that’s in absolute crisis right now, where we’ve got seven states that are arguing over who’s going to curtail their water use or receive less water,” he said.
