Policy analysis for informing climate adaptation, environmental resilience, and irrigation demands in the Rio Grande Basin.

Water policymakers internationally face the challenge of adapting to climate, supporting environmental resource needs, and meeting irrigation demands for food security in the world's arid and semi-arid regions. Much recent work has assessed the economic performance of environmental river flows to support endangered species habitat protection. However, little published work to date has systematically formulated and applied methods to identify the economic performance of various policy measures that adapt to climate, support endangered species, and meet irrigation demands for water. This work's original contribution with international relevance is to address those gaps by identifying the economic performance of various water shortage sharing methods for handling climate water stress while supporting protection of critical habitat to protect the endangered Southwestern willow flycatcher (Empidonax traillii extimus) along with Willow tree (Salix bonplandiana) habitat in the middle part of the Rio Grande Basin in North America, a region facing a number of conflicts between commercial uses of water and protection of key ecological assets. It develops a hydroeconomic optimization model containing information on crop water use and endangered species requirements in that region to identify the economic performance of three climate adaptation policy scenarios for handling water shortages while respecting endangered species habitat protection requirements. Results show how water shortages as well as policy responses for handing those shortages affect the economic value of water in agriculture for food security both with and without critical habitat to support the endangered flycatcher. This work's international relevance comes from its capacity to inform policy debates on the costs of protecting endangered species habitat under various climate scenarios and climate policy adaptation measures. Findings provide a general framework to address existing gaps in understanding and measuring the economic performance of measures to promote environmental resilience.

Sustaining aquifers hydrologically, economically, and institutionally: Policy analysis of the Ogallala in New Mexico.

Groundwater discharge exceeding recharge threatens sustainable aquifer water use internationally. Interest remains high in discovering more hydrologically sustainable and economically affordable measures to protect these aquifers. Previous research has conducted various aquifer assessments. Some work has investigated costs and benefits of various plans that would limit aquifer pumping. Despite notable advances in this kind of analysis, little published work to date has unified these elements into a science-based integrated framework to inform more sustainable aquifer policy design. This work's novel contribution is to integrate analysis of hydrology, economics, institutions, and policy into a unified scientific framework to inform choices on more sustainable pumping strategies while protecting economic activity for agricultural and urban water-using sectors. It does so by conceptualizing, formulating, designing, and applying a mathematical programming framework to replicate historically observed pumping patterns in parts of the Southern and Central High Plains Ogallala Aquifer region in New Mexico, USA. We first calibrated the optimization framework to replicate the historically observed data. We then go on to identify least cost pumping caps that would have partly restored the aquifer to its 2014 level by 2020, while comparing the performance of four other partial aquifer protection policy measures. Findings indicate a surprisingly low cost that could have been incurred to partially protect the aquifer over that period. However, these low costs are complicated by (1) decreasing water quality outside of the irrigated regions and (2) focusing of lateral inputs to a narrower zone of depression around the irrigated regions. These findings carry important implications for identifying more sustainable aquifer management plans internationally. The work's importance comes from its capacity to inform policy debates over a range of water shortage sharing plans, while respecting institutional constraints governing equitable burden sharing.

Integrating water science, economics, and policy for future climate adaptation.

Water science, water economics, and water policy issues continue to rise in importance internationally as elevated population, income growth, and climate change magnify scarcity, shortages, and injustices in water access. Based on the unique physical, institutional, and economic characteristics of water, this work's first contribution is to characterize a road forward for research innovations that enable better integration of water science, water economics, and water policy. Meeting water's sustainable development and justice goals calls for several research innovations that humanity awaits. The advances called for in this work include deep uncertainty management, red team reviews, innovative water rights design, accelerating SDG achievement, valuing water infrastructure, valuing natural water retention, incentivizing water conservation, improving financial performance of rural water systems, water network modularization, non-price scarcity signals, optimization model calibration, remote sensing, transboundary benefit sharing, optimal growth, and water valuation. The work's second contribution is to present a prototype scalable basin scale hydroeconomic analysis (HEA) as a framework for integrating these above innovations when they occur. Results of the HEA show that losses from a 50% shortage in the basin's surface water supply can continue to protect 93% of total economic benefits across economic sectors if an efficient water trading system is established to move water from lower to higher valued uses when shortages occur. The work concludes by noting that great advances remain needed for better and longer lives.

Climate adaptation guidance: New roles for hydroeconomic analysis.

Climate water stress internationally challenges the goal of achieving food, energy, and water security. This challenge is elevated by population and income growth. Increased climate water stress levels reduce water supplies in many river basins and elevate competition for water among sectors. Organized information is needed to guide river basin managers and stakeholders who must plan for a changing climate through innovative water allocation policies, trade-off analysis, vulnerability assessment, capacity adaptation, and infrastructure planning. Several hydroeconomic models have been developed and applied assessing water use in different sectors, counties, cultures, and time periods. However, none to date has presented an optimization framework by which historical water use and economic benefit patterns can be replicated while presenting capacity to adapt to future climate water stresses to inform the design of policies not yet been implemented. This paper's unique contribution is to address this gap by designing and presenting results of a hydroeconomic model for which optimized base conditions exactly match observed data water use and economic welfare for several urban and agricultural uses at several locations in a large European river basin for which water use supports a population of more than 3.2 million. We develop a state-of-the arts empirical dynamic hydroeconomic optimization model to discover land and water use patterns that optimize sustained farm and city income under various levels of climate-water stress. Findings using innovative model calibration methods allow for the discovery of efficient water allocation plans as well as providing insight into marginal behavioral responses to climate water stress and water policies. Results identify that water trade policy under climate water stress provides more economically efficient water use patterns, reallocating water from lower valued uses to higher valued uses such as urban water. The Ebro River Basin in Spain is used as an example to investigate water use adaptation patterns under various levels of climate water stress. That basin's issues and challenges can be of relevance to other river basins internationally.

Enhancing climate resilience of irrigated agriculture: A review.

Emerging evidence showing trends in climate change with a strong likelihood those changes will continue elevates the importance of finding affordable adaptations by irrigated agriculture. Successful climate adaptation measures are needed to affordably sustain irrigated agriculture in the face of elevated carbon emissions affecting the reliability of water supplies. Numerous potential adaptation options are available for adjusting irrigated agricultural systems to implement climate risk adaptation. This work focuses on addressing the gap in the literature defined by a scarcity of reviews on measures to elevate the capacity of irrigated agriculture to enhance its climate change resilience. Accordingly, the original contribution of this work is to review the literature describing measures for enhancing climate resilience by irrigated agriculture. In addition, it describes the role of economic analysis to discover affordable measures to enhance resilience by irrigated agriculture. It achieves those aims by posing the question "What principles, practices, and recent developments are available to guide discovery of measures to improve resilience by irrigated agriculture to adapt to ongoing evidence of climate change?" It addresses that question by reviewing several risk reduction measures to control the economic cost of losses to irrigators in the face of growing water supply unreliability. Following this review, a role for optimizing a portfolio of climate adaptation measures is described, followed by a discussion of potential contributions that can be made by the use of hydroeconomic analysis. Results provide a framework for economic analysis to discover economically attractive methods to elevate resilience of irrigated agriculture.

Sustaining aquifers economically in the face of hydrologic, institutional, and climate constraints.

Aquifers supply water to millions of farms, thousands of cities, and billions of people worldwide. Water use and economic activity in aquifer-dependent regions cannot be sustained if groundwater levels are not stabilized. This article addresses a question relevant to these regions internationally: how can water scarce areas reduce aquifer depletion while supporting the many economically and institutionally important uses of groundwater, which serve as a critical source of supply in many parts of the world with limited or seasonal precipitation which could become more pronounced in the face of future climate stress. Facing that challenge, this work presents a framework for discovering measures to hydrologically stabilize aquifers that control economic losses while respecting local institutional constraints. It advances our capacity to discover measures to efficiently, equitably, and sustainably allocate burden sharing that protects aquifers while adapting to hydrologic, economic, and institutional characteristics of an affected community. Results of this work show that for the aquifers investigated, present practices of groundwater use are unsustainable and finds that alternative practices are possible. It provides scenarios describing such practices and also determines their hydrological and economic consequences. Finally, it shows how these results can feed into policy debates over the several water-sharing arrangements. This work makes several incremental contributions: calibrating modelled pumping patterns to the historical baseline, controlling economic costs of achieving hydrologic sustainability, respecting institutional constraints governing equitable burden sharing, presenting an approach with powers of generalizability, and using routinely collected data. While the approach and findings are illustrated for two aquifers in Africa, its approach carries some generalizability. All data, variables, equations, constraints, and results are included as appendices.

Economic optimization to guide climate water stress adaptation.

Allocation of water over its six dimensions of quantity, quality, timing, location, price, and cost remains an ongoing challenge facing water resource planning worldwide. This challenge is magnified with growing evidence of climate change and related water supply stressors. This stress will challenge food, energy, and water systems as climate adaptation policy measures see continued debate. Despite numerous achievements made many by previous works, few attempts have scanned the literature on economic optimization analysis for water resources planning to discover affordable climate adaptation measures. This paper aims to fill that gap by reviewing the literature on water resource optimization analysis at the basin scale to guide discovery of affordable climate adaptation measures. It does so by posing the question "What principles, practices, and recent developments are available to guide discovery of policy measures to improve water resource system adaptions to growing evidence of climate water stress?" It describes past achievements and identifies improvements needed for optimization analysis to inform policy debates for crafting plans to improve climate resilience. It describes an economic conceptual framework as well as identifying data needs for conducting economic optimization exercises to support river basin planning faced by the challenge of managing the six water dimensions described above. It presents an example from an ongoing issue facing water planners in the Middle East. Conclusions find considerable utility in the use of economic optimization exercises to guide climate water stressadaptation. Any use of trade, firm, or product names is for descriptive purposes only and does not imply endorsement by the U.S. Government.

Managing food-ecosystem synergies to sustain water resource systems.

Measures implemented to restore ecosystem services are widely believed to conflict with food production in the world's irrigated regions because of their competition for scarce water. However, little integrated analysis has been conducted to test this hypothesis. This work tests that hypothesis by presenting results of a basin-scale hydroeconomic analysis linking biophysical, hydrologic, agronomic, ecological, economic, policy, and institutional dimensions of the partially-restored Mesopotamian Marshes of Western Asia. Results serve to partly reject the hypothesis: Here we find that an economically-optimized ecosystem restoration trajectory can be achieved with a minimal loss in food production or farm income where restored wetlands complement important dimensions of food production. Moreover, we find that where water shortage sharing rules can be made more flexible, ecosystem restoration more nearly complements improved food security. Our results point to previously unexplored synergies among food production, ecosystem restoration, and water laws in arid and semi-arid regions internationally.

Economics of irrigation water conservation: Dynamic optimization for consumption and investment.

Measures to protect irrigation water supplies for food security continue to receive international attention to address growing water scarcity when faced by increased food demands combined with reduced water supply reliability. Yet, a common problem where water is delivered with earthen canals is delivery inefficiency combined with low economic values per unit of water. In many of the world's arid regions, climate stressed water shortages have raised the importance of discovering measures to improve irrigation delivery efficiency. However, little research grade work to date has presented an integrated analysis of the economic performance of irrigation delivery improvements faced by drought and climate stressed regions. This paper's unique contribution is to investigate the economic performance of water conservation infrastructure combined with dynamically optimized use of saved water. We develop a state-of-the arts empirical dynamic optimization model to discover land and water use patterns that optimize sustained farm income. Results from the upper watershed irrigation region of the Canadian Basin in the southwestern US show that canal and delivery system lining can raise the sustained economic value of water for crop irrigation. The saved water can see immediate use in dry years. It can also be stored in wet years to mitigate the most adverse impacts of future climate water stress. This double dividend is especially important in rain-fed watersheds for which surface water supplies for irrigation are difficult to forecast accurately. Findings light a path for water managers and other stakeholders who bear responsibility of finding economically responsible measures to improve irrigation water productivity in the world's dry regions.

Incentive pricing and cost recovery at the basin scale.

Incentive pricing programs have potential to promote economically efficient water use patterns and provide a revenue source to compensate for environmental damages. However, incentive pricing may impose disproportionate costs and aggravate poverty where high prices are levied for basic human needs. This paper presents an analysis of a two-tiered water pricing system that sets a low price for subsistence needs, while charging a price equal to marginal cost, including environmental cost, for discretionary uses. This pricing arrangement can promote efficient and sustainable water use patterns, goals set by the European Water Framework Directive, while meeting subsistence needs of poor households. Using data from the Rio Grande Basin of North America, a dynamic nonlinear program, maximizes the basin's total net economic and environmental benefits subject to several hydrological and institutional constraints. Supply costs, environmental costs, and resource costs are integrated in a model of a river basin's hydrology, economics, and institutions. Three programs are compared: (1) Law of the River, in which water allocations and prices are determined by rules governing water transfers; (2) marginal cost pricing, in which households pay the full marginal cost of supplying treated water; (3) two-tiered pricing, in which households' subsistence water needs are priced cheaply, while discretionary uses are priced at efficient levels. Compared to the Law of the River and marginal cost pricing, two-tiered pricing performs well for efficiency and adequately for sustainability and equity. Findings provide a general framework for formulating water pricing programs that promote economically and environmentally efficient water use programs while also addressing other policy goals.

Water conservation in irrigation can increase water use.

Climate change, water supply limits, and continued population growth have intensified the search for measures to conserve water in irrigated agriculture, the world's largest water user. Policy measures that encourage adoption of water-conserving irrigation technologies are widely believed to make more water available for cities and the environment. However, little integrated analysis has been conducted to test this hypothesis. This article presents results of an integrated basin-scale analysis linking biophysical, hydrologic, agronomic, economic, policy, and institutional dimensions of the Upper Rio Grande Basin of North America. It analyzes a series of water conservation policies for their effect on water used in irrigation and on water conserved. In contrast to widely-held beliefs, our results show that water conservation subsidies are unlikely to reduce water use under conditions that occur in many river basins. Adoption of more efficient irrigation technologies reduces valuable return flows and limits aquifer recharge. Policies aimed at reducing water applications can actually increase water depletions. Achieving real water savings requires designing institutional, technical, and accounting measures that accurately track and economically reward reduced water depletions. Conservation programs that target reduced water diversions or applications provide no guarantee of saving water.