Monthly Archives: April 2010

That day is not yet.

Man, all the news stories are dull these days. Is this what blogging in a normal water year is going to be like?

I am working on several posts on water and markets. One day you’ll come by and see eight posts at once. If you have questions on water and markets, now is a good time to ask them.

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Filed under Uncategorized

A shadowy cabal, let me tell you.

This is an interesting article on businesses facing the realities of climate change, because they’re feeling early effects.

This makes capitalism a curiously bracing mechanism for cutting through ideological haze and manufactured doubt. Politicians or pundits can distort or cherry-pick climate science any way they want to try and gain temporary influence with the public. But any serious industrialist who’s facing “climate exposure”—as it’s now called by money managers—cannot afford to engage in that sort of self-delusion. Spend a couple of hours wandering through the websites of various industrial associations—aluminum manufacturers, real-estate agents, wineries, agribusinesses, take your pick—and you’ll find straightforward statements about the grim reality of climate change that wouldn’t seem out of place coming from Greenpeace.

I can tell you who isn’t interested in debating the reality of climate change and faked data. Upper managers at my state agency are not at all interested in an argument over whether climate change is real. They don’t have time for that. They’ll argue over how bad it might get, or whether we can get moving on mitigation fast enough. They’re as happy as anyone to work on strategies for shifting the burdens to someone else. But they’re acutely aware that climate conditions have already shifted. They know that the plumbing we have now won’t work half so well if we lose the snowpack. They can’t pretend that we might not lose the snowpack, because angry water districts are going to show up with pitchforks if we promise water we can’t deliver. (They also might show up with pitchforks if we admit that we can’t deliver water.)

You know how denialists say climate change is all a faked-up conspiracy? I’ve never really understood what the conspiracy is for. Like, who gains? I’ve heard different answers. Thousands of university researchers are carefully faking data, in tandem, for grant money that will keep them employed. (But they’d get grants doing other science if they weren’t studying climate change.) Environmentalists made up climate change because they want to enforce their tiny-car and cloth bag-bringing ways on red-blooded Americans. (I suppose, I guess.) I’ve heard that The State is making up climate change to support a land and water grab for billionaire farmers. (But, we don’t actually get to have that land and water. The land will be undersea or retired, and any re-allocated water will be spread finely over the next ten billion people to live in our cities. It isn’t like we bureaucrats get awarded cute little cabins with pure cold springs, mores the pity.) I guess the story below points to beneficiaries for the conspiracy. Starting in the early Eighties, university scientists started making up climate change so that thirty years later, the Bureau of Reclamation would buy un-needed new turbines from turbine companies in North Carolina. That was far-sighted of them. They’re probably related to the turbine company owners. It’s the only explanation.

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Filed under Basic stuff, Climate Change

Couple examples.

You know how I talk about climate change making everything more expensive? I usually attribute that to actually having less stuff (run-off, hydropower, precip). But there’s also the fact that we’re optimized to the current climate. Changing that will be expensive. Those costs permeate everything.

Yesterday there was a story about installing new turbines at Hoover Dam, so they can continue to generate power when lake levels are low from drought. That’s a small, unexpected cost of $3.4M, that will help us keep the power generation we have now, not increase generation or improve our quality of life. Today there’s a story about changing ocean currents scouring more sand than they used to, so dredged materials aren’t enough to re-fill a local beach. It’d cost the local city $700,000 to replace that sand, but they don’t have it, so this year they only replenished half the beach. In this case, our quality of life is going down, by half a pretty beach’s worth. Not the end of the world, but we’re going to take these hits and feel these small costs in hundreds of ways. Increases in water and utility rates are just the blatant examples of the ways we’re getting poorer.

I saw an early presentation of this paper on how climate change will shift sands on SoCal beaches a couple years ago. It’s pretty neat.

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Filed under Climate Change

In our lifetimes.

I’ve heard these numbers on food waste before, and don’t have any gut feel for whether they’re about right. (Via.) I’ll say what I always say, which is that the pounds of food waste could be huge (millions and millions), and still be a small percentage of the overall foodstream. But I don’t know. Maybe it is noticeable percentage of the foodstream.

If a noticeable percent of the foodstream is wasted, I think that using that making better use of that food has good potential to use less water in ag. Honestly, I think it holds more easy gains than straight up engineering solutions to irrigation techniques. There are still improvements to make on the engineering side of things, but contra the Pacific Institute, I don’t think they free up a ton of water. The three avenues I see for using much less water in ag without fallowing are: decreasing food waste, improving soil tilth, and bio-engineering crops.

The other thing I’d like to point out is that the farmer quoted in the food waste story said that farmers account for a five percent food loss in the fields. Last year, the year of the Communist carrots and the scares about loss of food production from drought, California carrot acreage was down 3%. This year, because of late rains, California carrot acreage is down 11%. But no one is going to go shrieking about rains causing us to import carrots from China. The food threat from the last three years of drought is completely unfounded, less than the annual write-off from harvesting waste (before food gets wasted at every other level of transaction).

Then, because I can’t help hammering home my usual theme, I have to point out that doing stuff like reducing food waste and improving soil tilth is exactly the type of intense management for small gains over widely spread territory that no one wants to do. We’ve exhausted the big, low-entropy sources of water, so if we want more, we have to get it in small bits from ungleaned fields everywhere. We are still rich enough that it is there for the taking. But we’re getting poor enough that we’re starting to be interested in taking what we never thought worth it before. This is what a transition to relative scarcity looks like.

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Filed under Agriculture, Climate Change

There will be a quiz.

It has been heavy on the policy side around here, so I wanted to get back to some science.

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Filed under Uncategorized

Maybe a flamethrower would be better.

This is an analogy, so I am properly ashamed.  I’ll put it under the fold so innocents don’t have to see if they don’t want to.

Continue reading

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Filed under Water Markets!!!

A market is just a tool. It isn’t a goal. It is a way to accomplish some things.

The Australian Markets Report (2008-2009)  is an example of everything wrong with water market enthusiasm.

The primary objective of the Commission’s Australian water markets reports is to inform market participants about market structure, trading activity, prices and key policy drivers. 

Providing this type of information to both direct and indirect participants in the market is an important step towards improving market performance.

Then it counts up the number and nature of water trades.  From everything I’ve seen, Australia is the best example of having a water market for the purpose of having a water market.  The metric of its success is whether it was a lot of water market or a little water market.  This is all ridiculous.  An assessment of a water market for the purpose of improving its performance should look at whether it does the things it was designed to accomplish.  In towns with more trades, are farm mortgages more secure?  In towns with more trades, do farmworkers have better working conditions? Do schoolchildren skip more?  Do people choose to use smart irrigation timers?  Do couples make love more often?   There should be some policy goal, chosen for some purpose (secure the Delta, support east side farming, make food affordable, make meat expensive, some goal).  And then we look at all the ways we could get to that goal, and perhaps a market is the least cost way to achieve that.  If so, we choose a market as the way to accomplish the goal.  Here, watch this applied to Cap and Trade.

In Cap and Trade, we want to reduce carbon emissions.  Reducing carbon emissions is the goal.  We do that because of conditions in the physical world.  We set a cap on carbon emissions because we have science about how much the atmosphere can absorb this year without the oceans boiling over and the continents exploding.  Right?  A policy goal, set by real world conditions.  Then, after science and people have agreed on that goal and set a cap, we look around for ways to do it.  We could regulate emissions.  We could tax emissions.  We could create a market in emissions.  Some people think creating a market in emissions would be the lowest cost way to get to our policy goal of reducing emissions.  In that case, they like Cap and Trade.  But we don’t want a cap and trade system because we LOOOOOOOVVEE trades.  We haven’t won if there are more faster trades than ever before.  We win if we hit the cap. 

That’s the problem with all the talk about water markets.  I never hear it paired with a goal.  “I want a water market that gets me a smaller, robust farming system.”  “I want a water market that gets me the cheapest possible water for urban users.”  “I want a water market that gets me the most expensive possible water for urban users, because then they’ll conserve.”  So far as I can tell, Australia wanted a water market because it wanted a water market, and we want a water market because Australia has one.  If Australia wanted a water market because it would make farming easier, because it would move water to cities, because of something, you can’t tell from the Water Markets Report.  It doesn’t measure anything but their market’s marketiness, which should only be of interest to the technicians tweaking it to accomplish some goal better.  But they don’t even have a goal. 

If you don’t have a goal for a water market, it will do ONE THING.  It will seek out economic efficiency.  Was that the goal in the first place?  Who the fuck knows, we never talk about actual goals.  Economists like to get rid of economic inefficiency, but some people call economic inefficiency their “jobs” and “towns” and “lifestyles”.  (I was impressed to see Dr. Michael discuss this issue a while back.)

I’m not even opposed to water markets on principle.  Once we have an actual goal, a market that was designed to support that goal could be the fastest cheapest way to get it.  Or not.  It almost certainly won’t be the fairest way to get that (because we aren’t starting with wealth spread evenly throughout society, so poor people will not be able to use the market to express their full preferences), so we should decide up front whether fairness is one of our design criteria.  But all of that is a secondary, technical conversation.  The first conversation should be to choose the goal.

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Filed under Uncategorized, Water Markets!!!