19 August 2008

Rationing in Paradise

For some reason,* Imperial Irrigation District, destination for 70% of California's allotment of water from the Colorado River, is using even more that that:
The 3.1 million acre-feet of water allotted to the IID from the Colorado River every year is just not enough. Although only a projection, the district is estimated to overrun its share by 112,000 acre-feet in 2008, up an additional 12,000 from the 100,000 acre-feet overrun projected last month.

IID spokesman Kevin Kelley said the district has a 65 percent chance of exceeding its allotment this year. This overrun will likely cause the district to declare a supply-demand imbalance.

If declared, a supply-demand imbalance will be cause to implement a water-rationing system within the Imperial Valley. The rationing system, or equitable distribution, would take effect Jan. 1, and the loss, if there is any, would have to be made up to the Colorado River by 2010.

Because a rationing system has never been implemented in the district, Kelley said it would be a “learning experience.”

Equitable distribution would primarily affect agricultural interests within the Imperial Valley, as the municipal and industrial sectors only use 3 percent to 4 percent of the district’s water.

Equitable distribution would allot the same amount of water to each entity and, according to the plan, unused water would be reapportioned to those farmers who need it most.
I quoted this article so extensively so you, the reader, can see how economics does NOT work:
  • A "supply-demand imbalance" means (here) that price is too low.
  • Rationing is the worst way to allocate anything that can be bought and sold. It would be better to allocate water by willingness to pay (and auction), especially since IID farmers understand the value of water as an input.
  • "Paying the river back by 2010"? That's pretty lame. When's the last time the Congress cut spending -- to pay money back? IID already has WAAAYYYY too much water (that they've wasted) and now they want more?
  • Learning experience is right. The Soviets tried to plan and ration for 75 years. Despite being able to put a man into orbit, invade countries, etc., they could never figure out how to ration. Good luck IID!
  • Notice that 96 percent of the water goes to farmers; they only have themselves to blame, which perhaps explains why IID has so many internal disputes.
  • How would you find out which farmers "need it most"? Are you going to ask them? Deliver water to those who wasted more than others? Had back luck? How do you reconcile these aims?
Bottom Line: IID continues to behave as if it's in an alternative universe. Too bad it isn't.

* That's my sarcasm talking. The reason is that IID sells water for $17/AF to its customers. That's pretty cheap.

1 comment:

CRG said...

There's always more to the story than you see on the surface. The BoR's forecasts are notoriously meaningless, particularly early in the year. After that August forecast of a 112,000af overrun, IID ended the year with a more-than-40,000af UNDERRUN.

As of 8/31/09, BoR is forecasting a 164,000af underrun for 2009 - an equally meaningless number.

Those forecasts assume level usage month-to-month, so if the usage has been 600,000af at the end of June, BoR will forecast a total usage of 120,000af for the year. The problem is that water usage does not work that way. Cropping patterns and weather vary significantly throughout the year, and water usage changes accordingly. The forecasts are useful, to a point, when taken in context.

The emphasis on the projected overrun in '08, and the subsequent SDI declaration, were partly a reaction to that year's water usage (and most people will tell you that '08 was an atypical year all around), and partly a convenient time to introduce the equitable distribution pilot program.