In Texas, Allan Ritter, a Republican and chairman of the House Natural Resources Committee, proposed bills that would withdraw $2 billion from the state’s Rainy Day Fund to establish a water infrastructure bank that would lend money for projects dedicated to the state’s 50-year water plan. His proposals received support from Republican leaders, the Sierra Club’s Texas chapter and the Texas Association of Business. (read the article)

 
Texas Republicans’ inclination is to reduce government involvement when markets can be involved, but, in this instance, previously opposing forces are cooperating to deal with what are perceived to be structural challenges. Water is essential to commerce, agriculture, energy and consumers. Current Texas politicians perceive water as too important of a commodity to be left to the markets to allocate and price.

How long will this perspective about water last?  Will other states follow?

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Most importantly, the Santa River which receives water from the glaciers, has passed its “peak water,” after which the amount of discharge from the glaciers drops off sharply.

The back story for the Peruvian experience is that agriculture was built up in recent years taking advantage of the glacial flow – just as the flow started to diminish.

This sets up a conflict for various users of the water, which is likely to be duplicated in many parts of the world so affected. The military has identified this conflict as central to future military conflict. At the very least, more efficient water-use will be a necessity for many years.

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That realization spurred action, and now China is the world’s leading practitioner of what is called the payment-for-ecosystems-services program – which essentially pays people to do what is good for the environment.  For instance, China pays farmers to reforest their land, hoping to slow soil erosion and the loss of valuable top soil due to poor agricultural practices. As a result of this one practice, Chinese officials, between 2000 and 2010, managed to increase the amount of forested land at the rate of 1.6 percent each year, a pace roughly three times faster than any other country in the world.  Beijing is also paying watchdogs to make sure the paid project actually happens.

Meanwhile, local governments have used the payment approach to protect water sources.  For instance, in some areas, local governments have passed laws that require anyone polluting a river upstream to compensate all those who suffer economic or health losses from that pollution downstream.

China’s program uses a software tool that measures overall costs of, say, cutting down a forest, including such secondary effects as erosion, additional risks of flooding, loss of carbon absorption area and so on.  With that information, Chinese officials are making economic decisions, and that model, which was actually developed at Stanford’s Natural Capital Project, is now being tried in Ecuador, Colombia, Mexico and Costa Rica.

(New Scientist, 6/16/12)

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