Policy Note: "Economic Tools to Achieve Groundwater Sustainability for Nature: Two Experimental Case Studies from California"

Abstract

Groundwater is a critical water supply around the world and is increasingly under threat from pumping that exceeds natural replenishment. California is taking on this challenge with the Sustainable Groundwater Management Act (SGMA) of 2014, which seeks to reliably manage groundwater to meet current and future water needs for the economy, communities and environment. Successful implementation of SGMA depends on the ability of local agencies to work with stakeholders to develop plans and implement projects that reduce groundwater use, increase recharge and efficiently allocate pumping. With more than 250 local agencies undertaking actions to address groundwater overdraft, California serves as a unique laboratory for testing new ways to achieve groundwater management. At the same time, economic tools are increasingly being utilized to secure or deliver water to the environment. For the past several years, The Nature Conservancy has been testing ways that economic tools can help achieve groundwater sustainability. This paper presents case studies that illustrate how two forms of Payment for Ecosystem Services (PES) — a groundwater market and a multi-benefit recharge incentive program — are being used in California to achieve groundwater sustainability to simultaneously meet the water needs of people and nature.

Dynamic multibenefit solutions for global water challenges

“…In future projects, The Nature Conservancy plans to evaluate the water quality benefits of this practice, since recharging aquifers on some agricultural soils that have been heavily fertilized can flush out nutrients and cause nitrate contamination in groundwater. The infiltration water volume from the BirdReturns work was two‐thirds the total amount of the annual rainfall over the same land area over a 2‐ to 3‐week time frame (Matsumoto, Rohde, & Heard, ). This was simultaneously accomplished while providing migratory bird habitat—reducing the threat of habitat loss to one of the major migratory flyways in North America by complementing existing efforts of permanent habitat protection.…”

“…In contrast, with the spatial certainty of permanent protected areas, pop‐up habitat in this area currently provides increased temporal certainty for migratory birds as the rental pool of available agricultural land is large enough to change year‐to‐year based on landholder needs and water availability. In addition, “renting” land and water to create migratory bird habitat is 0.5—1.5% the cost of purchasing and maintaining land and is a fraction of the cost in comparison to other water supply projects (Matsumoto et al, ; Reynolds et al, ).…”