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California’s Water Market: Overall Trends and Southern California’s Role. Ellen Hanak Public Policy Institute of California Presentation to So. Cal. Water Dialogue October 26, 2005. California’s Main Water-Using Regions. Bay Area. Sacramento Valley. San Joaquin Valley. - PowerPoint PPT Presentation
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California’s Water Market:California’s Water Market: Overall Trends and Overall Trends and
Southern California’s Role Southern California’s Role
Ellen HanakEllen Hanak
Public Policy Institute of CaliforniaPublic Policy Institute of California
Presentation to So. Cal. Water DialoguePresentation to So. Cal. Water Dialogue
October 26, 2005October 26, 2005
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California’s Main Water-Using RegionsCalifornia’s Main Water-Using Regions
Southern CA (rural)* (Imperial County)
San Joaquin Valley
Sacramento Valley
Bay Area
Southern CA (urban)
5m
10m
15m
20m
Population 2004
* Imperial County is included in the Southern CA region in this presentation
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OutlineOutline
Market trends to 2001Market trends to 2001
More recent and pending long-term transfersMore recent and pending long-term transfers
Data sourcesData sources
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Water Market Was Jumpstarted by DroughtWater Market Was Jumpstarted by Droughtin Early 1990sin Early 1990s
200,000
400,000
600,000
800,000
1,000,000
1,200,000
1,400,000
1985
1987
1989
1991
1993
1995
1997
1999
2001Acre-feet
456789101112131415161718
Water-yeartype
Acre-feet traded Water-year type
Dry
Normal
Wet
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Putting the Market in PerspectivePutting the Market in Perspective
Still comparatively small: 3% of all water Still comparatively small: 3% of all water usedused
But delivers 3 times more water than But delivers 3 times more water than recyclingrecycling
Contracts mainly short-term: 80% of volumeContracts mainly short-term: 80% of volume
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Environmental Concerns, Not Cities, Environmental Concerns, Not Cities, Drove Late 1990s Growth in DemandDrove Late 1990s Growth in Demand
200,000
400,000
600,000
800,000
1,000,000
1988 -1994 1995 -2001
Acre-feetper year
Mixed usesOther farmersSJ Valley farmersEnvironmentCities
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So Cal Share of Purchases: 10–35 PercentSo Cal Share of Purchases: 10–35 Percent
200,000
400,000
600,000
800,000
1,000,000
1,200,000
1,400,000
19851986198719881989199019911992199319941995199619971998199920002001
So Cal Other regions Acre-feet
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So Cal Has Not Been a Big Net Importer, So Cal Has Not Been a Big Net Importer, It Actually Has Exported in Wet YearsIt Actually Has Exported in Wet Years
-300,000
-200,000
-100,000
0
100,000
200,000
300,000
1988 1989 1990 1991 1992 1993 1994 1995 1996 1997 1998 1999 2000 2001 0
2
4
6
8
10
12
14
16
Net imports to So Cal Water-year typeNet exports from So Cal
Acre-feetWater-year
type
Wet
Normal
Dry
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OutlineOutline
Market trends to 2001Market trends to 2001
More recent and pending long-term transfersMore recent and pending long-term transfers
Data sourcesData sources
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Long-term and Permanent DealsLong-term and Permanent Deals Are On the Rise… Are On the Rise…
200
400
600
800
1,000
1,200
1,400
1988 1990 1992 1994 1996 1998 2000 2002recent or pending*
PermanentSales*
New Long-Term Sales *
Existing Long-Term Sales*
Thousands of acre-feet
* See data notes for an explanation
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...and So Cal and Environmental Programs...and So Cal and Environmental ProgramsAre Major BuyersAre Major Buyers
200
400
600
800
1,000
1,200
1,400
1988 1990 1992 1994 1996 1998 2000 2002recent or pending
Environment
Other regions
Southern CA
Thousands of acre-feet
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OutlineOutline
Market trends to 2001Market trends to 2001
More recent and pending long-term transfersMore recent and pending long-term transfers
Data sourcesData sources
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Data SourcesData Sources
Data up to 2001 are found in Hanak, Data up to 2001 are found in Hanak, Who Should Be Allowed to Who Should Be Allowed to Sell Water in California?, Sell Water in California?, Public Policy Institute of California, Public Policy Institute of California, July 2003, Appendix A (available at July 2003, Appendix A (available at www.ppic.orgwww.ppic.org))
Data on more recent trends in long-term and permanent Data on more recent trends in long-term and permanent transfers are taken from tables A.5 and A.6 in the above report, transfers are taken from tables A.5 and A.6 in the above report, supplemented with information from news articles. The “recent supplemented with information from news articles. The “recent or pending” category includes maximum annual flows from new or pending” category includes maximum annual flows from new or pending transfers – in practice it will take some years before or pending transfers – in practice it will take some years before these levels are reached.these levels are reached.– ““Permanent” sales refer to the permanent transfer of water Permanent” sales refer to the permanent transfer of water
rights or contractsrights or contracts– ““Long-term” sales are for over 1 year (typically ranging from Long-term” sales are for over 1 year (typically ranging from
10 to 45 years)10 to 45 years)
For questions, contact Ellen Hanak (For questions, contact Ellen Hanak ([email protected]@ppic.org); (415-291-); (415-291-44334433
