25 May 2008

Water is Valuable!

In this [NOT] shocking report, we learn that farmers in Imperial Valley are not interested in selling their water to the IID (so IID can meet fallowing commitments necessary to ship the water to MWD and SDCWA) at the low price on offer ($85/AF).

It seems that high grain prices mean that the farmers can get more value from the water by using it to grow food. It also seems that IID has not figured this out:
King said only 22 out of more than 400 farmers in the Valley have volunteered, making the pilot program useless.


“It may not be too late. There may be some incentive we can offer. We’re in a new field here — uncharted waters,” he added.
I'll tell you what incentive to offer -- RAISE THE PRICE! The farmers are making the right choice, trying to get as much value for their water as possible, but IID -- searching for incentives to offer -- seems to think that it can offer extra donuts or parking vouchers or something besides money to get farmers to participate. No way -- they need to offer more money.

Bottom Line: Water is valuable and it needs to be allocated to the highest and best use. Cities have argued this for years and have put real money on the table to buy water from farmers. IID (which sells water to San Diego for $250/AF) does not seem to realize that it has to pay to play as well.

Update: IID charges SDCWA just over $300/AF. That means that IID has even more leeway in making an offer to its farmers.