May 28, 2023

Policy Brief: Addressing Overallocation and Shrinking of the Colorado River

The Colorado River is facing significant challenges due to overallocation and reduced flow. The prospect of its two largest reservoirs, Lakes Mead and Powell, reaching dead pool levels threatens the water supply in the U.S. Southwest. Negotiations among the affected states - California, Nevada, and Arizona - have stalled, and the expiration of current water sharing guidelines in 2026 poses further risks. This policy brief explores the potential of water reallocation and the use of payments to promote long-term conservation. Additionally, it evaluates whether the proposed 3 million acre-feet reduction in water consumption is a good deal for Arizona.

Water Reallocation and Water Marketing: Water reallocation, transferring water from lower-value to higher-value uses, can play a crucial role in addressing the Colorado River's challenges. As part of a temporary pact, California, Nevada, and Arizona have agreed to reduce their combined water consumption by 3 million acre-feet by 2026. This measure aims to protect water supplies for cities, farmers, and tribes. To facilitate the transition, water marketing, such as voluntary sales or leases of water, can be utilized. Water marketing offers opportunities for water to be allocated more efficiently, ensuring its availability for essential uses.

Replacing Expired Guidelines: The next crucial step involves initiating discussions among the states to replace the expiring guidelines that govern the sharing of Colorado River water. These discussions will likely be more challenging due to the expiration of federal funding and the need for more severe cuts. Threats of litigation have surfaced as a potential solution, but resorting to court proceedings is a lengthy, costly process with uncertain outcomes. Legal arguments put forth by individual basin states often rely on interpretations of vague or ambiguous Law of the River documents, further complicating the legal landscape.

Is the Proposed Deal Beneficial for Arizona? Considering the proposed 3 million acre-feet reduction in water consumption, which represents approximately 14% of the combined allocations for California, Nevada, and Arizona, the question arises whether this is a good deal for Arizona. While the reduction poses challenges, it is crucial to recognize the broader context and the necessity of long-term conservation efforts to sustain the Colorado River's water supply.

Key Considerations:

  1. Water Security: The reduction in water consumption helps safeguard the availability of water for Arizona's cities, farmers, and tribes in the short term.
  2. Cooperation: By participating in the reduction agreement, Arizona demonstrates a commitment to cooperative and collaborative solutions, strengthening interstate relationships and potential future negotiations.
  3. Long-term Sustainability: Adapting to a future with reduced water availability is vital for Arizona's economic and environmental sustainability. By actively engaging in discussions and working towards viable solutions, Arizona can contribute to long-term water management strategies.

The overallocation and shrinking of the Colorado River demand urgent action to secure its water supply. Water reallocation, water marketing, and the replacement of expired guidelines are essential steps in addressing these challenges. While the proposed 3 million acre-feet reduction in water consumption presents difficulties for Arizona, it aligns with the broader need for long-term conservation efforts. By actively participating in negotiations and embracing cooperative solutions, Arizona can contribute to the sustainability of the Colorado River and ensure the availability of water for its communities, agriculture, and natural ecosystems.