Save it for next year?

Water law in the western U.S. doesn’t generally allow a user to save water from one year to the next. You use it, or you lose it. That, for example, is the situation faced by the Imperial Irrigation District this year, which faces the prospect of (horrors!) having Los Angeles get the extra water if the farmers don’t find something to do with it.

A new paper in Water Resources Research by Donna Brennan touts the benefits of creating a property right in stored water, allowing farmers to store and trade water across years, rather than only within a single year:

[C]ompared to the historically used, centrally determined storage policy, a market-based storage policy would store more water, on average, and would also allocate more water in periods of low rainfall.

It’s hard to think about the legal and policy approach that might be used here to implement such a thing. Suggestions?


  1. No answers.
    Just some questions?

    Where did the use it or lose it regulation come from? It sounds governmental and relating to government fiscal years not supply and demand.
    Who are the champions of the status quo?
    Will they block property rights on stored water?
    Is there a way to sell property rights so that consumers win and not too many oligarchs are created?
    A standard government approach is to assume that economic needs match government fiscal years. Usually this is not true. What are successful, stable, government or private multiyear resource management programs–programs that are not strongly driven by quarterly earnings or election cycles?

  2. Remember the basic rule of appropriative water rights: you have priority to what you use. If you don’t use it, the water becomes available to the next junior appropriator. So if in a normal water year, IID (as the most senior appropriator on the Colorado) decided not to make a call on its full right, and the middle appropriators took their full rights, then a junior appropriator, who normally would only get water in a very wet year, would get water.

    Now assume that MWD is that junior appropriator, and it uses that water for filling Diamond Valley Reservoir, or storing in the Los Angeles groundwater basins. Why would MWD agree to let IID store water up in Lake Mead? If IID doesn’t want the water, then under common law (that far precedes the Colorado River compacts) the water belongs to MWD.

    Also, back in the wet years, storage on the Colorado River was disfavored because you risked having the water dumped in order to make space for new water coming in.

    Water is very difficult to store — surface water evaporates, groundwater percolates away and also needs to be lifted back out of the ground. Most infrastructure to store water reliably long term is tremendously expensive per unit of water, so the only one who can afford it is the government. Governments are not in the profit-maximizing business; they want to serve the needs of their constituents by providing safe, affordable and reliable water. (Note that safety, affordability and reliability are goals that pull very much in different dimensions. More on that later, if anyone’s interested.)

  3. David, I see you’ve finally started learning the Law of the River. Under what legal authority can IID store water in Lake Mead? (And why should anyone care what your preferences are? You are neither a farmer in Imperial County nor an IID Board member.)

    JF: You’ve been at this long enough so that you should immediately have doubts whenever someone talks about “markets” for large volumes of water. Who are the buyers? Who are the sellers? Where does the transfer occur? Who carries the water from the seller to the buyer? What are the losses associated with storing the water until it’s needed? What losses are associated with carrying the water from the seller to the buyer? What risks are associated with storing the water (like loss of flood control or loss of capacity to store new water)? What are the environmental consequences with creating the “market” (like loss of natural flow for fish)? What impact will establishing the market have on other users of water in the hydrological system?

    Is this a one-time transfer or a long-term lease? How does the answer to that question change the analysis for the foregoing series of questions?

    What changes in state and federal law are needed to create the market? Is there any interest in the political community to take on such an enormous challenge?


    There are some (like Zetland) who appear to believe that creating a “market” for Western water is inherently a good idea. I’m more curious as to what is the problem that the creation of a market is supposed to solve.

  4. @Francis — your condescension is not productive. Isn’t the “law of the river” an evolving concept? Why can’t IID ask for storage. If Mulroy can swap a dam in CA for water in Mead, why can’t IID.

    Please get your head out of your casebook, and start to think of solutions instead of barriers.

  5. DZ: quite some time ago, I wrote that you were arrogant and sloppy. Unfortunately, nothing’s changed. I’ll continue to be condescending until your analysis improves.

    Arrogant — what possible basis do you have to know the appropriate course of action for IID? Here’s the bare minimum I’d need to know before advising them on what to do with surplus water: regulatory certainty regarding storage in Mead, evaporative losses in Mead, predicted rainfall for the 2010-2011 water year, capacity in the California Aqueduct, price of water offered by MWD and MWD member agencies, planting expectations w/in IID for next year, financial status of the District. And that’s just for starters. Do you have that info?

    Sloppy — you stated “IID can store it in Lake Mead”. But can it do so? Here is the Record of Decision for the “Colorado River Interim Guidelines for Lower Basin Shortages and the Coordinated Operations for Lake Powell and Lake Mead.” Unless you’ve read, and understood, the Interim Guidelines, you simply do not know whether IID can store the water in Mead. It is entirely possible that unused IID water goes to someone else. And what impact does the QSA litigation have on the Interim Guidelines? I don’t know, but I don’t claim to know whether IID can store surplus water in Mead.

    Yes, one possible grand solution is your idea of an all-in auction. Have you modeled the outcome of the auction? Run the idea past a lawyer, a politician, or MWD’s GM? Is there one single serious player in the water world who thinks your idea is a good one and should be pressed in Congress?

    Alternatively, you can take situation as it currently exists and see if you can’t make incremental improvements. That was the goal behind the Interim Guidelines and the QSA. That work is highly technical, requiring a deep understanding of the environment, the engineering, the law and history. It also tends not to generate sweeping solutions. I note that you’ve been highly critical of the QSA. But I have yet to see you offer a feasible alternative.

  6. I’ll avoid the ongoing confrontation and take a stab at Eric’s questions. In short, use it or lose it is a common law concept that expresses both the preference for putting water to beneficial use and an anti-speculation sentiment. Where water is limited, the fear that one person might lay claim to all water in a stream, regardless of whether they could actually put it to use, caused courts to impose a time limitation on putting the water to use after an appropriation was made – usually 3 years. Many states have enacted statutes that permit non-use for specified periods of time as part of short-term transfer agreements or preservation of in stream flow amenities. But the basic doctrine of use it or lose remains in all appropriation states – it doesn’t apply under the riparian doctrine.

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