The Great Midwestern Overdraft

The last 10 years have given rise to considerable consternation as to future water availability in the Western and Midwestern United States. Due to climate change as well as cyclical precipitation patterns, the rains have seemingly disappeared across these regions and the limitless supply of water we enjoyed over the past two centuries has become an anachronism of the past.

Individuals across the government, business, and non-profit worlds alike have developed plans geared towards reducing water demand while increasing future supply — Poseidon’s Carlsbad SWRO plant and California’s Sustainable Groundwater Management being perhaps the two most notable examples in the West. Few deny that the manner in which these regions use water today will drive the future viability of the regions and yet, by virtue of the massive infrastructure projects built following World War II, only one of these regions — the West — is positioned to adjust to a new, drought-like, normal. The Midwest, home of the Dust Bowl, historically known as the “Great American Desert,” and vast over-pumper of the great Ogallala Aquifer, has yet to adopt many of the lessons learned by Western counterparts in managing water supplies.

As a brief but important historical interlude, the Midwest first developed into an agricultural haven during the times of Manifest Destiny, as Congress’ Homestead Act and the Bureau of Reclamation distributed 40 acres of fertile land and cheap water, respectively, to aspiring entrepreneurs. Upon arrival, many of these optimistic Homesteaders found the land to be poor, the topsoil thin, and an ever-present need to irrigate the land in order to produce a steady crop. Over time a greater and greater number of individuals moved to the region — leading to an over-allocation of surface water resources and a need for increased numbers of irrigation projects that were fast becoming uneconomical (Note: for a great history of water west of the Mississippi, the 1986 book “Cadillac Desert” and its learnings remains surprisingly prescient today). As the population of this agricultural breadbasket continued to grow, surface water supplies became more stressed — and poor water management policies led in part to the outsized impact that the 1920s-drought had on the region.

The solution to this Midwestern crisis in the mid-20th century was not, unfortunately, to develop more sustainable water usage plans. Instead, new advances in drilling and pumping technology led farmers, irrigation districts, and municipal utilities to begin municipal-scale groundwater pumping programs in order to mitigate the impacts of surface water losses due to drought. For several decades, this ‘new’ water supply gave rise to an economy built upon some of the largest agricultural conglomerates that the world has ever seen. The Ogallala Aquifer (the largest freshwater aquifer in the world) was both the bounty that these individuals needed and the victim of these individuals’ lack of a coordinated management plan. Today, the Ogallala Aquifer has been depleted by approximately 300 ft in some areas, with losses between 2001 and 2011 equaling approximately 1/3 of the total losses from the entire 20th century. These groundwater resources, unlike the ocean water resources that the West enjoys, are not renewable, and continued over-extraction of this water supply is, at best, short-sighted.

Last year, if one were so inclined to read into Kansas water policy, two major events occurred signaling a shift in the status quo of Midwestern water supplies. First, Southwestern Kansas experienced the worst fires in modern recorded history in May 2017, with the Starbuck fire consuming over 662,000 acres of agricultural land across 23 counties, destroying the economic livelihoods of countless farmers, and permanently altering the landscape of the region. While these fires were, of course, not caused by the overdraft of the Ogallala Aquifer (in fact it was a downed power line), their ferocity signifies a change in the way in which we have to come to manage our land, and the consequences that can emerge following dry spells combined with over-allocated water resources.

Michele Steinberg of the National Fire Protection Association stated that, “Lack of mutual aid… and access to roads and water played a role.” Second, outgoing Gov. Sam Brownback held a state-wide ‘Water Tour’. Throughout this tour, Brownback spoke with constituents on how best to balance the management of water resources with the economic and cultural considerations that come from a conservative, agricultural state. One aspect of this tour was also to promote the Local Enhanced Management Area (LEMA) tool created by Kansas lawmakers in 2012 that saw a 35 percent decrease in water usage by participating farmers in just four years. Here, a voluntary (carrot) mechanism promoted by the government developed a means to reduce water usage without any compulsory (stick) penalties.

What resulted from these fires and this tour?

First, FEMA, the Department of Agriculture, and private insurance companies paid out hundreds of millions of dollars to farmers in order to compensate individuals/companies for their lost income and/or homes. President Donald Trump issued a Federal Disaster declaration, allowing impacted individuals to seek funds to help offset the economic hardships that have followed. Since the fires have died down, there has been little to no press on the follow-up to this disaster. A couple human interest pieces followed by silence. No discussions of improving water availability or disaster planning, no editorials on more resilient ground cover throughout the state, just crickets.

Secondly, Brownback’s tour of the state has led to little tangible policy to date other than a few press releases and speeches. While the LEMA tool has proven effective in Kansas, I am unable to find any follow up information regarding efforts or campaigns geared towards increasing the prevalence of these organizations in Kansas since August 2017. In fact, recent calls to the state’s Department of Environment resulted in a response detailing how the state has little understanding of how much money is being spent on water infrastructure every year, including drinking water, wastewater, storm water management, etc. Meanwhile, as the governorship transitioned from Brownback to Jeff Colyer, the Ogallala aquifer continues to decline in water supply by 5 in. every year. Kansas’s great achievement in reducing the speed at which the Ogallala declines remains insufficient — it is truly a manifestation of every economics undergraduate introductory lesson to the Tragedy of the Commons.

So, what can the Midwest do? How can the Midwest begin to come to terms with its own reality and understand that, unlike the West, it does not have a limitless supply of ocean water available along its borders? It is clear that, unlike during the times of the Dust Bowl, when a ‘limitless’ groundwater supply was discovered to supplement surface water sources, no such additional resource exists. Instead, the Midwest is entering into a timeframe in which Day 0 is fast approaching, a time when all emergency technology deployment and sustainable groundwater management plans will no longer be sufficient. Thus, we are entering into a time during which we must, like my old coach used to say, act with a hell of a lot more hustle and urgency.

What we need now is for business leaders and policymakers in this region to begin working together not to regulate, but to manage groundwater resources. While many in the Midwest scoff at the environmental ideals of California, the latter state’s Sustainable Groundwater Management Act is an excellent example of what strong, centralized leadership can do to optimize groundwater resources. Our policymakers’ goal must be to protect and represent American citizens — they are failing to do so if they fail to protect the water supplies of future generations. In addition, local communities must begin to develop greater tracking of extant groundwater wells, both permitted and off-grid, in order to better understand how withdrawals are shaping the aquifer and the region writ large. Business leaders must begin to work together to manage water usage — with farmers transitioning away from water intensive crops such as soy in favor or more drought-resistant crops and local manufacturing beginning to implement an internal price of water. In the end, true groundwater management will require a holistic approach to manage resources across all stakeholders, leading to a modern “Coasian equilibrium”.

What we are experiencing today in the Midwest is nothing new — academic books and papers have discussed the unsustainable groundwater withdrawals of the Ogallala for decades. But what is different is that this impending water crisis continues to be met with little resistance. The Midwest has, on an institutional level, done very little. If we hope to enjoy a region of the future that continues to thrive on agriculture, we better begin planning for that future. If we don’t, we are likely to wake up to a Midwest that bears little resemblance to the land that many, including myself, grew up to enjoy. 

Op-Ed: The ludicrous plan to pump Mojave water to L.A.

In 1992, prospectors in Los Angeles hatched an idea for a new water supply that was improbable and speculative, even by Southern California standards. Far off in the Mojave Desert, beneath the flat dry lake bed of the Cadiz Valley, millennia’s worth of groundwater could be pumped and piped 43 miles to the Colorado River Aqueduct, the crown jewel of the Metropolitan Water District’s massive web of infrastructure. The water then could be sold to any of the 26 member agencies of the MWD. This scheme came to be called the Cadiz Valley Water Conservation, Recovery and Storage Project, now known as the Cadiz project. It is owned by a publicly listed corporation, Cadiz Inc., which in 25 years has yet to turn a profit.

After decades of court battles, mixed environmental reviews and bleak investor reports, the Cadiz project has recently taken a few steps forward. In a decision issued last May, an appellate court certified that Cadiz Inc. has the legal right to 50,000 acre-feet of the Mojave groundwater per year for the next 50 years. Then, early last month, the White House removed a restriction on a federal railroad right of way, effectively allowing Cadiz to build a new pipeline for moving the water to the existing aqueduct without undergoing a federal environmental review. And now a Cadiz lobbyist and shareholder, David Bernhardt, is under consideration for the No. 2 position at the Department of Interior, where, if confirmed by the Senate, he would help decide the future of the project.

In many ways, the Cadiz project is consistent with Southern California’s miraculous and controversial water history. A $1-trillion economy now exists in what was once a scarcely inhabited flood basin thanks to prodigious feats of civil engineering. There is enough water to support our way of life because the Los Angeles Aqueduct, the State Water Project, the Colorado River Aqueduct and the All American Canal bring it here.

 

The closer a water source is to where the water gets used, the better.

But Cadiz’s vision is now out of step with the times. In the decades since the project was conceived, water planning has moved away from the centralized, over-engineered projects of the past to decentralized infrastructure that is more resilient and efficient. Just as telecommunication grids are migrating from wired lines to mobile networks, and electricity generation from power plants to community-level solar power, our water infrastructure, too, is becoming more localized. The closer a water source is to where the water gets used, the better.

Examples of this new-style water infrastructure are underway all over Southern California. There are more than 30 new water recycling projects in operation or in development, converting reclaimed wastewater into potable water, according to the WateReuse Assn., in addition to dozens of non-potable water recycling projects. At least four new desalination plants are in operation or development in Southern California, designed to supply water to their immediate communities. And plans to crack the concrete of the Los Angeles River and other flood channels will capture millions of gallons of stormwater a year.

Simple economics drove this change. The cost of moving water long distances has grown, while lower costs of technology and other factors have made these smaller, decentralized projects less costly. Also, in California and elsewhere, many large-scale water schemes have been revealed as vulnerable (the State Water Project crosses the San Andreas Fault 32 times) and increasingly expensive to maintain (see: Dam, Oroville).

After four years of drought — the worst on record­ — the biggest surprise for most water planners was not Southern California’s scarcity, but the region’s adaptability. California’s overall water use has been in decline since peaking in 1995 even as the state’s population has grown, thanks to low-flow fixtures, turf removal and other conservation measures. We now know that any new need for additional water could be more than offset by a combination of these conservation measures, water reuse projects, seawater desalination facilities, stormwater capture and groundwater recharge efforts.

Cadiz has set an estimate cost for their water of $775 and $960 per acre-foot, and other estimates put the cost at $850 per acre-foot. MWD’s current average price of untreated water is $670 per acre-foot. This means that water users who buy Cadiz water would see a rate increase for a project that no longer is necessary. What’s more, taxpayers paid for the construction of the Colorado River Aqueduct, and MWD water users pay the cost of its operations and maintenance. We would be footing the bill for Cadiz in more ways than one.

If water users were presented with a choice between the cost of Cadiz and conservation, they almost certainly would prefer to conserve. It’s only the absence of true price transparency and customer choice that has allowed a project as fraught and flawed as Cadiz to move forward. We already are looking at $1 trillion in deferred spending on maintenance and enhancement of our existing water infrastructure around the country. This infrastructure should get the attention it needs before we break ground on anything as speculative as the Cadiz project. (Again, see: Dam, Oroville.)

There is another factor that undoubtedly will raise the cost of the Cadiz project, a factor so worrisome the company buried it deep inside its SEC investment risk disclosures. Cadiz groundwater contains the carcinogen hexavalent chromium, or chromium 6. Although chromium 6 can be treated, Cadiz’s plan is unconvincing at best: The company claims that by blending Mojave water with Colorado River water, the chemical will be diluted to safe levels. The legal limit is in dispute, with the California Department of Public Health recommending a limit of 10 parts per billion (ppb), and courts allowing up to 50 ppb. Still, MWD’s water currently has no detectable chromium 6, while Cadiz’s water contains the carcinogen at levels up to 16 ppb.

Cadiz would be detrimental to more than just Californians’ wallets. Opponents of the project correctly argue that the extraction of 50,000 acre-feet per year is unsustainable, putting the area’s sensitive freshwater springs and delicate desert ecosystems at risk. (According to Cadiz’s own analysis, the average annual replenishment volume of water is only 32,000 acre-feet.) Moreover, if history is any indication, it is unlikely that Cadiz would keep to the 50,000 acre-feet over 50 years. One need only look to the Owens Valley for an example of what happens when a thirsty metropolis dips a straw into a far-flung water resource. The temptation for overuse would be too great to resist.

Cadiz claims the project has been delayed because of environmental obstructionism and burdensome regulations. In fact, the project has struggled because it fails on its merits. While technically feasible and legal, it presents significant economic, engineering, quality, sustainability and environmental challenges, and is made even less desirable by a recent surge in cheaper, less risky alternatives. Southern California would be wise to move beyond the outdated methods of the Cadiz project and welcome a new generation of ideas for securing water.