For the  past year +, I’ve had the fortunate opportunity to work with Green Investment Group, Inc. at their Missoula, MT Frenchtown Technology Center. The former pulp mill includes 25,000 acre feet of documented historic industrial/power generation use and extensive irrigation water rights. Together, it’s the largest industrial water rights portfolio in the Middle Clark Fork Basin by over 4x. In a basin with groundwater restrictions (35 gpm, 10AF per year) , this portfolio provides an obvious source of water for future demands.

This recent interview with KVGO highlights some of the assets and marketing opportunities.  Additional information is available upon request.

The Unfiltered Truth About Water

For the third straight year (Year 1 &  Year 2)  I’m calling all entrepreneurs with a “fire in the belly” to apply to PERC’sEnviropreneur Institute HERE.  Similar to last year, I’ll leave you with these words of inspiration from the The Icarus Deception.

The challenge of our time is to find a journey worthy of your heart and your soul.

I’d also strongly recommend reading this book shortly after you apply.

I recently completed some market research for a client in New Mexico. This work confirmed my thoughts that markets  aren’t everywhere. In fact, they’re few are far between. New Mexico does have active water markets (Rio Grande, Lower Pecos), although this project wasn’t in one of them.

Reflecting on this work, I identified 7 reasons why New Mexico water marketing is not everywhere.

1. Privacy. Water rights transactions tend to remain private in nature. Thus, uncovering private deals is easier said than done.
2. Record Keeping. The record keeping and tracking of potential transactions remained a challenge in the specific basin.
3. Political Opposition. New Mexico allows acequias or qualifying ditch companies to adopt bylaws requiring their approval as a condition to surface water transfers. Although this law does not specifically pertain to groundwater, the political opposition to trade still exists.
4. Administrative Cost. The administrative cost to change a water right in New Mexico can be high with great uncertainty of success. This creates a barrier to trade.
5. Water Sharing. Water right holders in New Mexico often informally share water within irrigation institutions, thus decreasing the need for trade. This “legal” sharing occurs in districts where the State Engineer has appointed a water master.
6. Exempt Water Use. Small “domestic” groundwater exemptions still exist in New Mexico in annual volumes up to 3 AF per household. The limited domestic demand that existed in this basin allowed for groundwater exemptions to meet demands and  further reducing the need to trade
7. Economic Growth/Decline. Larger economic principles drive growth and a demand for water. Although this basins was closed, economic metrics showed a zero or negative economic growth in recent years.

Although specific to an undisclosed basin in New Mexico, these observations are common across the West.

I’d like to, once again, commend the authors for their work. I’d like to see more transparency in all of these markets and feel publications like this one are a step in the right direction. You can read the publication for yourself,  although two of my highlights taken from the report are embedded below. In case you missed the hyperlink above to the publication, here it is again:

http://www.forest-trends.org/documents/files/doc_3308.pdf

]]> http://activelymovingwater.com/water-market/instream-flow-markets-have-arrived/feed/ 0 http://activelymovingwater.com/marketing/water-bank-update-montana/ http://activelymovingwater.com/marketing/water-bank-update-montana/#comments Tue, 01 Jan 2013 20:33:03 +0000 Chris Corbin http://activelymovingwater.com/?p=1313

This time last year I reflected on my 11 lesssons of 2011. Although many of these lessons hold true for 2012, I’ve decided to share 1 piece of news for the New Year: a Montana Water Bank Update.

Today, I enter my fourth year of determined effort to establish Montana’s first Water Bank. 2012 ended on a high note with a letter (above) from the DNRC determining our application correct and complete. This is a step in the right direction, but far from the finish line. As we begin this next chapter, I’m reminded of this quote by Benjamin Frankin:

Diligence is the mother of good luck.

Happy New Year!

Additional information regarding this water bank are found in this Ecosystem Marketplace article: Can his water bank help Montana solve its water troubles?

December 3, 2012

Contact: Tom Iseman (WGA), (303) 623-9378 or Tony Willardson (WSWC), (801) 685-2555

DENVER — The Western Governors today released a report, Water Transfers in the West, which provides an overview on how the region can help meet growing demands for water with voluntary market-based sales and leases of water rights.

“Voluntary water transfers have occurred for decades,” said Governor Gary R. Herbert (Utah), Chairman of the Western Governors’ Association. “But with so many new citizens and industries settling in the water-scarce West, now is the time to evaluate how we use transfers in our approach to providing water.”

A water transfer, as defined in this report, is a voluntary agreement that results in a change in the type, time or place of use of a water right.  Water transfers can take the form of a sale, lease or donation and they can move water among agricultural, municipal, industrial energy and environmental uses.

Water transfers are one component of a suite of tools Western water managers can use to meet new demands from changes in farming practices, energy development, and urbanization. States can also develop new infrastructure and storage (such as dams), conservation and efficiency, and water reuse projects.

“There is no magic wand or silver bullet when it comes to meeting water supply, only well-informed decision making,” said Jennifer Gimbel, Director of the Colorado Water Conservation Board. “This report will help states learn from each other’s experiences with water transfers in order to make the best decisions for each state’s water future.”

Water transfers offer a means to “re-purpose” existing water resources for new uses. Since farmers hold many of the West’s senior water rights, the Governors passed a policy in 2011 advocating that states “identify and promote innovative ways to allow water transfers from other uses … while avoiding or mitigating damages to agricultural economies and communities.”  The report also addresses ways to mitigate impacts to the environment.

The report is a product of a year-long project in partnership with the Western States Water Council (WSWC), a group of top water administrators in the Western states. The Western Governors’ Association and WSWCconvened three stakeholder workshops with more than 100 participants from July to December of 2011. The meetings drew state administrators, environmental organizations, farmers, academics, and water resource professionals from across the West, providing diverse perspectives on water transfers.

“The balanced approach to water transfers advocated for in the WSWC report is the same philosophy that must be advanced on an even larger scale here in the West,” said Patrick O’Toole, President of the Family Farm Alliance and a workshop participant. “Transfers are a way of meeting short-term water challenges, but they are only one instrument in a much broader suite of tools that also must include water conservation and modern infrastructure to store and move water.”

Rather than providing a “one-size-fits-all” blueprint for states to follow, Water Transfers in the West highlights successful transfers and innovative practices to allow Western states to learn from their collective experiences and take advantage of the “lessons learned.” The report also recognizes that each state’s individual circumstances will determine how it should address transfers. It addresses only transfers within states, and not interstate transfers.

“Transfers are already occurring in all of the Western states, and many state water administrators say that transfers will continue to play a vital role in the way they meet demands,” said Tony Willardson, Executive Director of the Western States Water Council (WSWC).  “WSWC and WGA will continue to provide states with information on how to take advantage of the decentralized and flexible nature of transfers while avoiding or mitigating any negative effects of transfers.”

WGA and WSWC will continue their work on water transfers following the release of the report.

The report, titled Water Transfers in the West: Projects, Trends, and Leading Practices in Voluntary Water Trading is available for download online at westgov.org/water. Information from past stakeholder workshopsand perspectives from stakeholders are also available online.

We frequently forget the exceptional water quality we enjoy in the U.S. and the basis for this luxury.

Water Changes Everything. from charity: water on Vimeo.

I’ve frequently expressed my vision for water banking and loosely defined a Water Bank as a market mechanism to facilitate water trading. The example closest to home includes my work (3 years and running) with the Grass Valley French Ditch Company. I’ve also featured Trout Unlimited’s research on water banking to mitigate exempt wells, as well as other mentions on this topic.

Due to the location specific nature of these markets, defining these water banks and scaling these business models is a challenge at best.  As such,  much confusion exists around “what is a water bank?”

More confusion has arrived with the release of the NRCS Water Bank Program - a $7.5 million dollar program to keep more water on the landscape for water fowl.

As is common in many emerging markets, the language is  just another challenge the water market faces.