AGRION

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As Governor Jerry Brown proclaimed (on January 17th) that California was in the midst of probably the worst drought the state has experienced in a century, many wonder whether California is finally ready to take the actions necessary to ward off a major environmental and economic disaster. But it may be too late.

This drought is now three years running, with 2013 the driest on record, but previous droughts have often extended for a decade or longer, and mega droughts can last for several decades. Governor Brown’s call for 20% reductions in water use will help, but even if successful, would be just a temporary fix.

By far the largest consumer of water in California is agriculture, accounting for about 80 percent of all water consumption. The drought could be devastating for this $45 billion business, and for California’s economy. Farmers had already learned they would not receive *any* water from the State Water Project, and now the recent announcement that farmers may not receive *any* water from the Central Valley Project either...is a very ominous development.

Meanwhile, increasing temperatures related to climate change have significantly reduced the Sierra Snowpack (which provides about one-third of the state’s water), now standing at about 30 percent of normal levels.

Longer term actions and strategies include:

• Governor Brown’s Bay Delta Conservation Plan

• Water Desalination

• Recycling Wastewater

• Increased Ground Water Storage

• Increased Surface Storage

• Conservation Oriented Rate Structures

• Pricing the Carbon Footprint of Water

• Repairing and Replacing Fragile Levees

Moreover, as the stark reduction in water available for Hydropower worsens, California may often turn to Natural Gas as a substitute, resulting in greater greenhouse gas emissions.

And the drier weather just leads to mass forest die-offs and dangerous mega-wildfires.

Financing projects and strategies for bringing water supply and demand to the required equilibrium over the longer term can be very difficult. The perception that water is relatively low-cost can be exacerbated by water utility rates that are set substantially below their true costs. Relatively flat rate structures have further encouraged overuse, and newer increasing block rates have been ineffective at curtailing water demand when successive blocks do not increase the price adequately.

The California “Safe, Clean and Reliable Drinking Water Supply Act of 2014”, an $11.14 billion general obligation bond, is a modified version of a water bond which has been delayed for several years, as public and political support were lacking. More recently, scaled-back versions of the bond have been proposed in the California Senate and Assembly, reflecting the difficulties of getting the votes necessary for passage.

An alternative approach, assessing a modest non-bypassable public goods charge on investor-owned utility ratepayer bills, has proven politically challenging as well.

Here are some of the questions which our panel of experts will answer, focused on California, but also including the southwestern states:

1) What are the primary actions which state and local government, as well as publicly-owned and privately-owned water utilities, can take to mitigate drought?

2) Which of these actions are most likely to be successful?

3) What are the primary actions which the government and private sector can take to adapt to drought?

4) What are the public financing options most likely to both secure political approval and be most effective?

5) What actions can individuals and communities take to effectively reduce water use?

6) If the 13-year drought covering the southwestern USA states is becoming a mega-drought, what additional actions should be taken in those states, including California?

The specific meeting location in San Francisco will be provided upon registration.