Biden's investment in climate change is benefiting large agricultural businesses located along the Colorado River.

Biden’s investment in climate change is benefiting large agricultural businesses located along the Colorado River.

The agreement to save water from the declining Colorado River is being seen as a major benefit for influential farmers and tribes in the Western region.

2009 program have been

According to a recent investigation by POLITICO, a significant number of agreements made under the 2009 program worth $1.2 billion for water conservation have been deemed ineffective. 2007

In May 2007, Arizona, California, and Nevada reached a deal.

The value of current contracts for water conservation and transfer is increasing by approximately 50%.

The Colorado River provides water to 40 million individuals and large areas of the nation’s most fertile farmland. However, this task is becoming more challenging as the effects of climate change cause its flow to decrease. Despite this, an investigation conducted through numerous interviews and analyses of government documents indicates that the influx of federal funds may ultimately lead to a more costly resolution for preserving the West’s vital river.

“It’s all a grand experiment,” said Kathryn Sorensen, a former head of Phoenix’s water department, who noted that Democrats’ Inflation Reduction Act

Funding is essentially generating a fresh market for water, with a increased price. “This market, particularly one with a higher value, could potentially lead to some undesirable motivations.”

The $1.2 billion in federal funding that made the May deal possible comes out of a $4 billion pot of money in the climate law tagged for mitigating drought. That provision, secured at the last minute by Independent Sen. Kyrsten Sinema

The state of Arizona created this plan during a time when the Southwest seemed to be facing a potential disaster. The water levels of Lake Mead, an important reservoir for the river, had reached their lowest point since its initial filling in the 1930s. This decline was occurring rapidly and there were concerns that the lake could reach a critical level within months, making it impossible to obtain water through the Hoover Dam.

The Biden administration

Last autumn, the Inflation Reduction Act provided the first portion of funding to water-right holders in Arizona, California, and Nevada.

As a trade-off for storing their water in Lake Mead, the states were given an incentive. However, the Interior Department also warned that if a suitable plan to conserve enough water was not agreed upon, they would take control of the river and implement cuts.

25% of the amount that California is obligated to pay under the agreement with Arizona and Nevada.

However, the farmers in that region had previously made a commitment to conserve that amount of water. This was initially part of a agreement made in 2004 with the major urban water agency in southern California, the Metropolitan Water District of Southern California. It was later reaffirmed in a 2021 agreement between regional water agencies and the federal government, with the goal of increasing reservoir levels.

$1,200 per acre-foot of water

Instead of receiving $270 for each acre-foot of water as specified in the previous agreements, the landowners are now expected to receive approximately $1,200 per acre-foot of water.

Under the IRA program, the cost is $400 for each acre-foot..

Currently, the irrigation district is attempting to revise its extended water transfer agreement with Metropolitan, which is essential in securing water resources for Los Angeles and San Diego in the face of climate change impacts. Once the federal program terminates in 2026, the original water-conservation contract will return to Metropolitan and remain in effect for an additional 12 years.

The president of the board of trustees for the Palo Verde Irrigation District, Dana Fisher, stated that the district had been discussing with Metropolitan about increasing their payments from the previously negotiated levels in 2004. The Inflation Reduction Act program brought attention to this ongoing discussion.

Fisher stated that there is a difference between our Met contract and the federal offer.

During an interview, Camille Touton, the Commissioner of the Bureau of Reclamation, recognized that numerous new conservation contracts are based on less expensive previous agreements.

However, she stated that there is a significant difference between previous programs and the recent federal one. In previous agreements, such as the one between Palo Verde and Metropolitan, the saved water would have been used by someone else. With the new federal program, this water is left unused, which contributes to an increase in Lake Mead’s water level.

Touton explained that the conserved water is stored in the Lake Mead system to maintain stability in the reservoirs.

It was also mentioned that the Biden administration intends to allocate the remaining $4 billion of IRA funds towards initiatives such as reinforcing canals, constructing reservoirs, and improving irrigation systems. These efforts will result in sustainable decreases in water consumption over time.

It is possible that water conservation deals are becoming more costly, even without the additional federal funding. This is due to the fact that the diminishing river has led to heightened competition for a finite resource.

Tom Buschatzke, the lead negotiator for Arizona on the Colorado River, stated that all of these programs require a seller who is willing to participate. He also mentioned that several of the previous agreements made with California farmers were reached under pressure.

The cost for water conservation in his area was $261 per acre-foot, but the federal offer is now up to $400 per acre-foot. Buschatzke predicts that the future price will be similar to the IRA price.

The majority of Arizona’s preserved water will be sourced from cities, tribes, and industrial users who utilize the main Colorado River canal system, known as the Central Arizona Project. This information was revealed in a Bureau of Reclamation presentation obtained by POLITICO and confirmed by previous federal statements. These users have mostly committed to keeping their water in Lake Mead instead of storing it in nearby underground aquifers, where it could be saved or sold for later use.

However, these particular users faced the highest likelihood of experiencing mandatory reductions in their water supply if reservoir levels continued to decline. By agreeing to conserve water for Reclamation, they were able to receive compensation for potential cuts and also contribute to increasing reservoir levels, thus increasing the likelihood of receiving their full water allocations.

The share of the agreement allocated to Nevada is small and does not involve any federal reimbursement.

However, in the Southwest, there is an influential agricultural region that is gearing up to implement substantial conservation efforts.

The crown jewel of the states’ May deal is an additional 250,000 acre-feet per year offered up by California’s Imperial Irrigation District. The district uses the single largest share of Colorado River water — more than the states of Arizona and Nevada combined — and has for more than a century taken a firm stance against efforts to alter its status as one of the last to take cuts in times of shortage.

Imperial’s acceptance of additional water conservation responsibilities, in addition to existing ones from 2003, was a major victory for the Biden administration. However, it will be expensive.

According to sources familiar with the ongoing negotiations, the irrigation district is seeking a contract with Reclamation that would pay double the usual $400 per acre-foot rate for agreeing to not use water for at least three years. Both parties involved have chosen not to disclose the specific price at this time, as negotiations are still in progress.

In the end, the irrigation district intends to fulfill its conservation promise primarily through implementing new initiatives to decrease summertime irrigation. However, it is currently not feasible to conserve water in this manner for this year. Therefore, local water organizations are preparing to transfer water from an existing conservation program in Imperial Valley to the federal program.

The program, which involves farmers saving water for San Diego, was established twenty years ago when San Diego’s political leaders were in dire need of securing control over their water resources. The cost, currently approaching $800 per acre-foot, has been criticized by others in the area as excessively expensive.

Currently, the Biden administration seems prepared to solidify this as the established cost for water usage from the river’s largest consumer.