Insights from California's experience with drought and water management.

1. Trading Water and Managing Groundwater
Sustainably: Insights from California
Ellen Hanak
Water Policy Center, Public
Policy Institute of California

2. What is water trading and why does it
matter?
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• Water trading: temporary, long-term or permanent trades of rights or
contracts to use water
• Why it matters for water-limited regions like California:
• Reducing costs of drought
• Accommodating shifts in demand
• Adapting to a changing climate

3. Trading has requirements and constraints
• Infrastructure
• To connect source/destination
• To get/store/retrieve water from banks
• Protections
• No injury (unreasonable harm) to other water users (including fish
& wildlife)
• Should also aim to prevent, mitigate significant local economic
harm in source regions
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4. California’s extensive infrastructure facilitates
trading, even across long distances
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Counties in the market

5. California’s 2014 Sustainable Groundwater
Management Act
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• 127 priority basins, > 250 sustainability
agencies
• Local sustainability plans due in Jan.
2020 or 2022
• 20 years to fully attain sustainability
goals:
• Water levels
• Aquifer storage
• Water quality
• Seawater intrusion
• Land subsidence
• Surface water, ecosystem impacts

6. In overdrafted basins, attaining balance
means more recharge, less water use, or both
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 Cooperative recharge programs
can help capture extra water in wet
years
 Trading within basins can lower
costs of reducing water use
 This requires partnerships…and
transparent monitoring,
accounting systems for basins that
everyone can trust