As part of its oversight and approval role over Columbia River Basin (CRB) fish and wildlife programs, the Northwest Power Planning Council (Council) receives proposals to augment instream flows for the benefit of fish. Such proposals sometimes include plans to accomplish this instream flow augmentation by the short- or long-term acquisition of water rights from existing owners.
Because such instream flow acquisition has little precedent in the region, the Council has requested the assistance of the Independent Economic Analysis Board (IEAB) to develop recommendations and guidelines for how such water acquisitions might be accomplished, and how these proposals should be evaluated. Specifically, the Council asked the IEAB to address the following questions:
- What determines the economic value of water uses?
- How is water use currently allocated, and is this allocation based on economic value?
- How should the cost-effectiveness of a proposed water project be evaluated?
- How could market mechanisms or program structures be used to increase the cost effectiveness of water projects?
A specific motivation for this report was the Council's recent experience with streamflow enhancement in the Teanaway River. As explained to the IEAB by Karl Weist, a large section of the Teanaway is dewatered every irrigation season. The intent of the Teanaway River Instream Flow Restoration Project is to restore flows to the Teanaway by purchasing land with water rights attached, by purchasing water rights outright and by doing a water conservation project. Due to landowners’ strong reluctance to sell water rights and land for streamflow enhancement, the project evolved into a water conservation effort. The Bureau of Reclamation, Bonneville and others would purchase new irrigation systems for the three main water user groups on the Teanaway, replacing the current system of push-up dams with a lower point of diversion on the river and a high-pressure irrigation delivery system. By installing this higher-tech system, and eliminating flood irrigation, it was hoped that considerable volumes of water would be saved.
For a variety of reasons, the cost of the project escalated to $5.3 million. According to Weist, the project would generate no more than 3.74 cfs during the irrigation season (which is equivalent to 7.4 acre-feet per day). If the irrigation season lasts 6 months, this conservation project would be expected to add 1,351.4 acre-feet to instream flow -- at a cost of $3,921 per acre-foot. This cost seems high based upon casual comparison to prices experienced in Idaho and Oregon water markets. So, we set out to gain some perspective on whether this cost is unreasonably high for a stream enhancement project and whether water acquisition would be an appropriate, low-cost alternative.
