Buying water for the environment: A hydro-economic analysis of Salton Sea inflows

Authors: LEVERS, L. - University Of California; Skaggs, Todd; SCHWABE, K. - University Of California

Submitted to: Agricultural Water Management
Publication Type: Peer Reviewed Journal
Publication Acceptance Date: 10/27/2018
Publication Date: 11/15/2018
Citation: Levers, L.R., Skaggs, T.H., Schwabe, K.A. 2018. Buying water for the environment: A hydro-economic analysis of Salton Sea inflows. Agricultural Water Management. 213:554-567. https://doi.org/10.1016/j.agwat.2018.10.041.
DOI: https://doi.org/10.1016/j.agwat.2018.10.041

Interpretive Summary: In arid and semi-arid regions, the allocation of scarce water resources among agricultural, urban, and environmental sectors is frequently contentious, involving adversarial claims about water rights and the private and public benefits of different forms of water use and consumption. Economic optimization models provide one possible means of assessing water allocations. In this work, we develop a regional agro-environmental economic model that accounts for essential field-level agronomic processes related to crop production, irrigation water quality, soil salinity, and drainage. As an example, we assess the allocation of Colorado River water in Southern California and its impact on the Salton Sea. The results indicate that limited water leasing programs would help reverse the ongoing degradation of the Salton Sea with relatively small decreases in agricultural production and either no impact or increases in grower profits. The value of the water generated and used for environmental flows greatly exceeds the costs of the programs, which are substantially less than comparable alternative Salton Sea restoration plans. This research will be of use to researchers and policymakers concerned with water use and water allocations in arid and semi-arid regions.

Technical Abstract: As societies confront greater levels of water scarcity, conflict follows. Water transfers are increasing with irrigation water regularly considered in such discussions given it often comprises the bulk of water rights within a particular region, especially in water scarce environments. Here we analyze the impacts of three widely considered and implemented strategies to purchase water from irrigated agriculture—land fallowing, improvements in irrigation efficiency, and direct leasing. Our empirical application involves water transfers from Colorado River water rights holders to the Salton Sea, a critical ecological resource that has been in decline for many decades, with environmental damages estimated in the tens of billions of dollars. We develop a regional hydroeconomic model that accounts for essential field-level agro-hydrologic processes related to crop production, irrigation, and salinity to evaluate the cost-effectiveness of these three programs. Results indicate that both fallow and direct water lease programs are capable of generating significant environmental water flows with relatively small decreases in agricultural production and no appreciable decrease in grower profits. Because these policies focus on a single input (applied water) rather than overall inflows to the Sea, the direct lease program—which is the most cost-effective approach for generating water conservation— may result in less inflows into the Sea than a land fallowing program.