19 February 2009

Water Markets in Colorado

In response to my request for more information on water markets in Colorado, Tyler McMahon wrote the following:
This paper [PDF] on water transfers in Colorado is more on the economic impacts on the comparative basins, but also discusses historical transfers.

Another paper [PDF] by Charles Howe, Jeffrey Lazo, and Kenneth Weber (1990) has a table of water transfers in the Arkansas Basin, the most controversial basin - but no prices. I've attached a copy of this table [DOC] that I updated for my thesis with information from the District 2 State Engineer and the Howe and Goemans paper. As you can see there is limited information on these transfers, part of the problem.

The Northern Colorado Water Conservancy District has a functioning water market internally, everybody uses it as a model of the market. The problem is that it is transbasin water meaning no legal obligation for return flows and the market is between anybody in the water district that receives Colorado Big Thompson water.

Charles Howe has been very active in discussing water markets and has a lot of stuff out there with other co-authors on Colorado's efforts.
Please comment if you have more information on water markets in Colorado.

Bottom Line: Markets differ in form, function and efficiency. Take the time to find out why.

1 comment:

  1. Is there really a Water Market ?

    Interesting that the water markets discussed, for the most part, involve transmountain diversion water ( Colorado Big Thompson and Fryingpan Arkansas Project).

    Waters from these projects, which are from tunnels under the Continental Divide, are NON-TRIBUTARY to the receiving South Platte and Arkansas River basins. The non-tributary aspect provides for much of their versatility in the market place.

    There is another proposed Project to bring 4-500,000 acre feet each year from the Green River at Flaming Gorge to the Denver area. It too will be a trans-mountain diversion and non-tributary to the South Platte River basin, if and when it arrives.

    All of these transmountain diversions legally deplete the flow of the Colorado River, their basin of origin.

    Strange that no State, municipality, BUREAU, or water district that receives water from the Colorado River in CA, CO, AZ or NV is the least bit interested in receiving any of the million acre feet a year of NON_TRIBUTARY fresh water from a Source that is legally available, economically feasible and will not damage the environment or the water rights of anyone, anywhere !

    The NON-TRIBUTARY million acre feet a year could be not only utilized to keep Lake MEAD FULL and producing 2000 megawatts of renewable energy each year, but could also be utilized to solve numerous water shortage dilemmas throughout the Colorado River basin and the other river basins directly or by exchange.

    Water for restoration of the Colorado River Delta, endangered species, oil shale, drug & immigration problems with Mexico and water supply for CA and Las Vegas are all solvable !

    I doubt very seriously that there is a water market on the Colorado River ! What there appears to be is only a water shuffle arrangement between key players at the water table with no seat available for a supply outside the existing water trough ...

    If I am wrong, I challenge any entity that receives water from the Colorado River or its tributaries to step forward in writing and specify an exact quantity that they would be willing to buy if the price and legal circumstances met all of their contingencies.

    Requests for FREE water for NOTHING do not count!

    Note: After all these years of effort, any personal gain is a very tiny part of a master plan to solve the water problems of the region.

    Ray Walker (Retired Water Rights Analyst) waterrdw@yahoo.com

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