Subsidies and Pricing Key to Significant Water Conservation in California Agriculture

Subsidies and Pricing Key to Significant Water Conservation in California Agriculture

In September, the Pacific Institute, an Oakland-based environmental think tank, released More with Less: Agricultural Conservation and Efficiency in California, a report that analyzes opportunities for reductions in agricultural water use, particularly in the water-stressed Sacramento-San Joaquin Delta region. That fragile ecosystem is home to the court-protected Delta smelt and a significant source of irrigation water to a large percentage of California’s agricultural production. More with Less makes a number of valid and valuable points but, unfortunately, is also misleading.

The authors note that a major challenge in forward planning for California’s water resource management is that reliable data on regional and statewide water use is limited, particularly in the agricultural sector. Improved monitoring – including remotely sensed satellite and aerial data – will be a valuable tool in understanding trends in agricultural water use. This data will also provide useful input for irrigation scheduling systems.

The report also correctly argues that direct or indirect subsidies that result in artificially low agricultural water prices essentially subsidize inefficiency. The report calls for a removal of these programs that “encourage inefficient use.” Appropriate and accurate pricing across all use sectors is crucial for promoting adoption of water conservation that will help to alleviate some of the water quantity stresses across the state, particularly in dry years like 2007 and 2008.

The report also points out that the “existing water rights system in California provides disincentives for water conservation and efficiency improvements.” This is very much the case. The convoluted water management system in California, and the use-it-or-lose-it approach to most water allocations, means that users who do conserve risk losing their water rights. That analysis is on target, but More with Less doesn’t get everything right.

The crux of this report is that achieving significant reductions in agricultural water use can be done relatively simply. The report suggests, for example, that significant savings could be obtained by switching 25 percent of field crops in the Delta region to vegetable crops, which use less water and are easier to irrigate with more efficient irrigation systems.

Indeed, this would save some water. But while the report calls this change “modest,” in fact it would be somewhat radical. According to data presented in the Pacific Institute report itself, a 25-percent decrease in field crops is approximately the scale of change that has occurred in California in the last 25 years. Accomplishing that same scale of change in a short period of time is no simple matter.

The report suggests we might “simply change [land] use from more water-intensive field crops to less water-intensive vegetable crops” but there are numerous reasons why this change is not nearly as “simple” as the report makes it sound. Growing field crops like alfalfa and cotton differs from growing vegetable crops in a number of important and fundamental ways.

The necessary equipment is different, the scheduling is different, the management is different, and the markets are different. With the right water pricing signals, no doubt some farmers would elect to make this change, but the report is too optimistic about the water savings that would realistically result from these changes in the near term.

On this issue, we should not lose sight of the importance of agriculture to the California economy. California leads the nation in agricultural production, bringing in the highest cash receipts of any state, and leads the nation in production of a vast array of agricultural products, including almonds, asparagus, broccoli, carrots, grapes, hay, milk, and strawberries. That kind of production requires considerable use of water, currently channeled through an inefficient and wasteful system. Achieving significant reduction in agricultural water use is important and possible, but it won’t be easy.

By implying this change can be accomplished simply, and reporting the significant water savings that would result, More with Less obscures what should be the main message. Significant changes in water subsidies and water pricing in California will encourage conservation across all water-use sectors – including agriculture – through whatever means the users deem most appropriate for their individual situations.

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Nothing contained in this blog is to be construed as necessarily reflecting the views of the Pacific Research Institute or as an attempt to thwart or aid the passage of any legislation.