interviews
Water and the American West
by Richard Frank
October 25, 2021
This interview with Richard Frank, professor of environmental practice at the UC Davis School of Law and Director of the California Environmental Law and Policy Center, was conducted and condensed by franknews.
frank | Can you tell me a little bit about the story of water and how it's tied to the West, and to California in particular?
Richard | A friend of mine who's a Court of Appeals Justice here in California wrote an opinion on a water law dispute and started it with the quote, "the history of California is written on its waters." And I think that the point is true of the entire American West.
Water policy and legal issues are inextricably tied to the development of the Western United States; water is the limiting factor in so many ways to settlement, to economic development, to prosperity, and to the environment and environmental preservation.
Can you talk about the difference between groundwater and surface water– and the policies that regulate each?
There are really two types of water when it comes to human consumption. There's surface water: that is the water that is transmitted by lakes, rivers, and streams. Then there is groundwater, and a substantial amount of water that Americans and the American West rely on is groundwater. That is water that is stored in groundwater aquifers, which are naturally occurring groundwater basins. Both groundwater and surface water are critical to the American West and its economy and its culture.
Traditionally a couple of things are important to note, first of all, water is finite. Second, water gets allocated in the Western United States generally at the state level. There's a limited federal role. Primarily, policy decisions about who gets how much water for what purpose are made state by state.
I think allocation is really interesting in that it's more state-level than federal. How was water and the allocation of water in California designed? Is it a public-private combination? What goes on in terms of the infrastructure of water?
Another very good question. The answer is it depends. Most of our water infrastructure is public in nature.
Again, in the American West, the regulation of water rights is generally done at the state level, but the federal government, historically, has a major water footprint in the American West because it has been federal dollars and federal design and management that really controlled much of the major water infrastructure in the American West — you know, Hoover Dam, and the complex system of dams and reservoirs on the Colorado River in California, with the Central Valley Project that was built and managed by the federal government with Shasta Dam on the upper Sacramento River as the centerpiece of that project. But we also have a California State Water Project, the key facility being the Oroville Dam and reservoir on the Southern River that is managed by state water managers. If we were starting over, that kind of parallel system would make no particular engineering or operational sense.
But, we are captive to our history.
And then you have these massive systems of aqueducts and canals that move water from one place to another throughout the American West. They are particularly responsible for moving water from surface water storage facilities to population centers. In the last 50 to 75 years, these population centers have really expanded dramatically, so you need massive infrastructure to deliver water from those storage facilities, the dams, and reservoirs, which generally are located in remote areas to the population centers. So it takes a lot of time and energy to transport the water, from where it is captured and stored to where it is needed for human use.
California has faced continuous drought – what measures is the state taking now to manage water?
Just to frame the issue a little bit — we have, as I mentioned, a growing population in the American Southwest at a time when the amount of available water is shrinking due to drought and due to the impacts of climate change. We have growing human demand for residential and commercial purposes and at the same time, we have a shrinking water supply. That is a huge looming crisis.
And it is beginning to play out in real-time. You see that playing out in real-time. For example, several different states and Mexico rely on Colorado River flows based on an allocation system that was created in the 1920s, which is overly optimistic about the amount of available water. From the 1920s until now, that water supply has decreased, and decreased, and decreased. Now you have interstate agreements, and in the case of Mexico, international agreements that allocate the finite Colorado river water supplies based on faulty, now obsolete, information. It is a real problem.
What measures do you take now, knowing this information?
If you look at the US Drought Monitor, it is obvious the problem is not limited to the Colorado River. We are in a mega-drought, so cutbacks are being imposed by federal and state water agencies to encourage agricultural, urban, and commercial water users to cut their water use and, and stretch finite supplies as much as possible through conservation efforts.
In California, we have the State Water Resources Control Board, the state water regulator in California, and they have issued curtailment orders. Meaning, they have told water rights holders, many of whom have had those water rights for over a hundred years, that, for the first time, the water that they feel they are entitled to, is not available. Local water districts are also issuing water conservation mandates; the San Francisco water department is doing that, in Los Angeles, the metropolitan water district, is urging urban users to curtail their efforts.
And then agriculture. Agricultural users — farmers and ranchers — have had to get water rights in many cases through the federal government, as the federal government is the operator of these water projects. They have contracts with water users, individual farmers, ranchers, or districts, and they are now issuing curtailment orders. They're saying, we know you contracted for X amount of water for this calendar year, but we are telling you because of the drought shortages we don't have that water to supply. Our reservoirs are low at Lake Shasta or at the Oroville Dam.
When you drive from San Francisco to LA on the five, you see a lot of signage from the agricultural farming community about water. There's apparently some frustration about this. What are the other options for them?
About 80% of all human consumed water goes to agriculture. That is by far the biggest component of water use, as opposed to 20% used for urban and commercial, and industrial purposes.
Over the years, ranchers and farmers, and agricultural water districts assumed that the water would always be there — as we all do.
And the farmers and ranchers have, in hindsight, exacerbated the problem by bringing more and more land into production. You see on those drives between San Francisco and Los Angeles, particularly in the San Joaquin Valley, all these orchards are being planted. Orchards are more lucrative crops than row crops — cotton, alfalfa, and rice. But, if you are growing a row crop, you can leave the land fallow in times of drought.
We don't have to plant. If the water stopped there, or if it's too expensive to get, it may make economic sense, but if you have an orchard or a vineyard it's a high value, those are high value crops, you don't have that operational flexibility and they need to be irrigated in wet years and in dry years. Now, you see these orchards, which were only planted a few years ago, are now being uprooted because the farmers realized that they don't have the water necessary to keep those vineyards and orchards alive. For ranchers, the same thing is true with their herds. They don’t have enough water for their livestock.
The water shortage has never been drier than it is right now. Farmers and ranchers are being deprived of water that they traditionally believed was theirs and they're very understandably, very unhappy about it. They see it as a threat to their livelihood and to the livelihood of the folks who work for them. Their anger and frustration are to be expected, but it's nobody's fault.
To say, as some farmers do, that it is mismanagement by state and federal government officials, I think is overly simplistic and misplaced in the face of a mega-drought. Everybody's going to have to sacrifice. Everybody's going to have to be more efficient in how they use water. All sectors are going to need to be more efficient with the water that does exist.
Looking at this percentage breakdown of water use – is it actually important for individual users to change their water habits?
Well, every little bit helps. When you're talking about homeowners, about 70% of urban water use is for outdoor irrigation. So we're talking parks and cemeteries and golf courses and folks' yards. You know, that used to be considered part of that American dream and the California dream — you would have a big lawn in front of your house and behind your house. Truth be told, that has never made much sense in an arid environment. That's where the water savings in urban areas is critical in the way it really involves aesthetics rather than critical human needs, like water for drinking and bathing and sanitation purposes. There is a growing movement away from big lawns, and away from the type of landscaping that you see in the Eastern US — there is no drought in the Eastern United States. As Hurricane Ida and other recent storms have shown, the problem is too much water, or rather than too little in most of the Eastern United States. So it really is a tale of two countries.
We just need to recognize that the American West is an arid region. It has always been an arid region, we can't make the desert bloom with water that doesn't exist. We need to be more efficient in how we allocate those water supplies. And it seems to me in an urban area, the best way to conserve and most effective way is to reduce urban landscaping, which is the major component of urban water use.
You also write about water markets and making them better – for those who don’t know, what is the water market?
Water markets, that is, the voluntary transfer of water between water users, is more robust in some other Western states. Again Arizona and New Mexico come to mind. California somewhat surprisingly is behind the curve. We are in the dark ages compared to other states. Water markets are kind of anecdotal. There is not much of a statewide system. It is done at the local level, through individual transactions without much oversight and without much transparency. And I have concerns about all of those things.
I believe conceptually watermarks are a way to stretch scarce, finite water resources to make water use more efficient. I can, for example, allow farmers or ranchers to sell water to urban uses or commercial usage or factories in times of drought.
Farmers sometimes can make more money by farming water, than they can by farming crops.
There are efficiencies to be gained here.
The problem in my view is really one of transparency. The water markets are not publicly regulated, and some of the people who are engaging in water transactions like it that way, frankly, they want to operate under the radar.
In my opinion, water markets need to be overseen by a public entity rather than private or nonprofit entities. We need oversight and transparency, so that folks like you and myself can follow the markets to see who's selling water to whom, for what purpose, and make sure that those water transfers serve the public interests and not just the private interests.
There have been a number of stories in the New York Times and the Wall Street Journal and the Salt Lake City Tribune about efforts in some parts to privatize water transfer. Hedge fund managers are buying and selling water, as a means of profiting. And it strikes me that when you're talking about an essential public resource — and in California, it is embedded in the law that public water is an inherently public resource, that water is owned by the public and it can be used for private purposes, but it is an inherently public resource — the idea of commoditizing water through the private, opaque markets is very troublesome to me. I think it represents a very dangerous trend and one that needs to be corrected and avoided.
Why is California so behind?
There's no good reason for it. It's largely inexplicable that since the state was created on September 9th, 1860, we've been fighting over water. In the 19th century, it was miners versus farmers ranchers. In the 20th century, with the growth of urban communities, the evolution of California into one of the most populous states with 40 million Californians, it has been a struggle between urban and agricultural uses of water.
In the second half of the 20th century, there was a recognition that some component of water had to be left in streams to protect ecosystems, landscape, and wildlife, including the threatened and endangered wildlife. That suggestion has made agricultural users in California angry. You will see those signs that allude to the idea that food and farming are more important than environmental values. I don't happen to believe that's true. I believe both are critically important to our society. But the advocates for the environment have a proverbial seat at the water table. So that's another demand for water allocation that exists.
Do you maintain optimism?
Yes. I think it's human nature to look on the bright side. I try to do that through research scholarships and teaching. There are models for how we can do this better in the United States. Israel and Saudi Arabia and Singapore are far more efficient with their water policies and efforts. Australia went through a severe megadrought. They came out of it a few years ago, but they used that opportunity to dramatically reform their water allocation systems. That's an additional model. I think most people would agree in hindsight that their previous system was antiquated, and not able to meet the challenges of climate change and the growing water shortage in some parts of the world.
Here in the United States, we can learn from those efforts. There are also some ways to expand the water supply. Desalination for one. Again, Singapore and Saudi Arabia have led the world in terms of removing the salt content from ocean water and increasing water supply that way. In Carlsbad, California, north of San Diego, we have the biggest desalination plant in the United States right now, and that is currently satisfying a significant component of the San Diego metropolitan areas’ water needs. It's more expensive than other water supplies, but the technology is getting more refined, so the cost of desalinated water is coming down at a time when other water supplies, due to shortages and the workings of the free market are going up.
At some point, they're going to meet or get closer. Unlike some of my environmental colleagues, I think desalination is an important part of the equation.
In a proposal that came up in the recall election, one of the candidates was talking about how we just need to build a canal from the Mississippi River to California to take care of all our problems. That ignores political problems associated with that effort, as well as the massive infrastructure costs that would be required to build and maintain a major aqueduct for 2000 miles from the Mississippi to California. That's just not going to happen. Some of those pie in the sky thoughts of how we expand the water supply, I think, are unrealistic.
interviews
How FICO Limits Clean Energy
by Forrest Watkins
February 11, 2019
This interview with Forrest Watkins, a program manager at Solstice, was conducted and condensed by frank news.
How do you, as a company, define energy democracy?
For us, energy democracy is really about giving power over our energy systems back to everyday people. We know that for the whole history of the energy industry, the benefits and the impacts of energy systems have been very unevenly distributed. Low-income communities and communities of color have confronted the worst impacts of pollution from energy and industry – to the extent that a 2017 study showed that the very structure of our cities has been informed by which sectors of the city are downwind, and where the pollution will blow and have the most impact.
To this day, there are millions of people that lack access to electricity. Even in places where we think of our electric grids as robust and well-developed, like in the U.S., low-income households frequently experience energy poverty, where they don't necessarily have the money to adequately heat their homes. And this has real impacts on people’s health and livelihoods, especially those of children and families.
When we're working on energy democracy, we’re trying to ensure that the next iteration of our energy systems can reverse that dynamic, and really put the people that have been marginalized in fossil-fueled energy systems, at the core of the transition to clean energy.
On a practical level, that means that when we're building out solar and wind energy infrastructure, we need to make sure that low-income communities, communities of color, are included in the benefits of those energy projects, and equally importantly, that they have a say in the development of those projects. When there's a project going into our communities, whether it's a solar project or a gas pipeline, we really need to make sure they have a say in how that develops, and whether it's developed in the first place.
Finally, it's worth calling out that movements for clean energy and environmental protection have pretty consistently undervalued the needs and objectives of communities of color, low-income communities and other marginalized people. Movements for energy democracy and environmental justice, on the other hand, has been led by these communities, from Afton, North Carolina in 1982 to present-day groups like PUSH Buffalo, Greenlining Institute, and campaigns like the Portland Clean Energy Initiative.
Why do you think there's such a lack of understanding about where our energy comes from and how the grid functions?
I think it’s the same thing with a lot of the really important, complex issues that we’re facing today. I care a lot about energy and have worked really hard over the last few years to do what I can to contribute to equity in the space, but I don't necessarily have the same level of understanding on agriculture, or on health systems.
But I also don't know that in-depth policy and resource understanding is necessary to increasing democratic control. If we build the transition to clean energy on the idea that everyone has to understand regional power markets, or utility resource planning schemes, or different regulatory processes, then I don't know if we're going to get there. But if we can give people an opportunity to say, "Yes, I want the choice to participate in this renewable energy program." Or, "Yes, I think if you have the chance to build out more renewable energy in the coming years, you should include that in your resource planning." There's lots of ways we can take the incredible public support for renewable energy, and translate it into smart policies that shape the future of energy.
How do you engage the unengaged in a conversation about transitioning away from a system they’re used to, and might not mind?
Solstice does a lot of the direct engagement in getting people signed up for local, community-shared solar arrays. We know what people are thinking about when they're making these decisions. What we see is people might have different motivations for supporting renewable energy, but they really, overwhelmingly support clean energy, and they don’t want to wait. For some people, it is a climate motivation, or making a more sustainable energy system. Other people, it's not that. Some people say, "I don't believe in climate change," or, "I don't believe that humans are even having an effect on the climate. But solar just makes sense, because it's less expensive, and it gives us more independence in your energy supply.” For some it's about that, the cost savings of energy independence
I think for us, when we’re thinking about our impact, we really want to engage with everyone in the transition to renewable energy, regardless of their specific motivations for it. When it comes down to it, I think people have heard this is the right way to go economically as well as environmentally. When we get on the phone with them, or are at the town hall events with them, it's not something where we have to do a tremendous amount of convincing.
Energy democracy is really tied to clean energy. But the move towards clean doesn't necessarily have to incorporate the ideals of energy democracy. There is a version of this that's corporate, and the power structures won’t change. Why is discussing power, when talking about energy, important?
What we've seen so far in the solar industry, though, is that the early adopters who are able to make these decisions, are generally people with higher income, and the time to shop around and make a good investments decision. In many states, a lot of the wind and solar deployment is being driven by big, investor-owned utilities.
It can be argued that this is the most economically efficient way of rolling out clean energy, but we also know from a few centuries of hard data who benefits from an energy system that’s built that way - and who is marginalized. When we build at a scale that serves a community, and we create spaces for input on the project from the community, that’s how we fit the project to their needs and priorities, and make sure that it’s developed in an equitable way.
When you're building at that scale, it also increases the resiliency of the grid. If you have a more decentralized system with more local power generation, that's a way of reducing the risk for local communities, and making them more resilient to larger impacts. As we're looking at cases like California and Puerto Rico, if our goal is to get the power back on sooner for communities regardless of their economic or racial makeup, inclusive, community-scale solar is a great path to creating an energy system that is resilient not just for the people able to invest in a rooftop array, but also those who aren't.
And how does this all work in practice?
Community solar allows people to enroll in a local solar array and see credits on their energy bill as if they had the array on their own rooftop. Solstice typically uses a subscription model, because it allows people to participate without any upfront payment. So we’ll look at your utility payment history, and how your energy bill has fluctuated over time. That allows us to adjust the allocation size for your energy needs. Once that energy project's turned on, you will start seeing credits on your utility bill. Those credits will more or less zero out your energy bill, and you pay for that energy, but at a discounted rate. The typical discount that we see is about 10%.We advocate for contracts that let the customer pass the subscription on to another customer, should they have to move, or have to cancel their subscription for whatever reason. That just allows for everyone to participate, whether they're renters, or other people that have higher levels of mobility.
At Solstice, we don't develop the projects ourselves. We work with the people that develop and finance the solar projects, we help them get people signed up for the projects, then manage people’s experience, and their allocations, on an ongoing basis. We have a software platform that integrates this with utilities systems to manage the billing process and give people ongoing information about how much they're saving, how much their piece of the solar garden is contributing to carbon reductions, things like that.
We also have invented the EnergyScore, an alternative way of qualifying people for community solar farms that is more accurate in predicting people’s utility bill payment behavior and more inclusive of low-to-moderate income households than the FICO credit scores that are typically used to qualify people for projects. Our goal is really to make it as easy as possible for everyone to participate in these projects, regardless of their background, or how they're coming to the table.
How do you charge people, and decide the value of what that energy is worth?
There's a number of different ways people are approaching this. What we advocate for, is doing a direct percentage discount, because that is really the best way of protecting the customer and making sure they are seeing a discount, no matter what. There are legislated programs of community solar in 18 states, and the 19th, New Mexico, is likely to pass a bill before long. In those 18 states, currently, there is legislative program that allows for automatic bill crediting and the administration of these programs. Under those, people automatically see the utility bill credits that allow them to see savings at the end of the month.
Do you work outside the grid, or through the grid?
We work through the grid. There are definitely some exciting things happening in the microgrid space. At this point, they still have a fairly limited set of use cases because the economics often don’t allow people to save. But in some cases, like with off-grid communities, or organizations like hospitals that really need a high degree of reliability and resiliency, it can make financial sense for them to do that. As far as community solar goes, we’re operating through the traditional grid, and that makes the most financial sense in a lot of ways, not having to reinvent the whole grid system, but just adapting it to meet the new reality.
As energy storage becomes cheaper over the next decade and demand response technologies become more sophisticated, the line between on-grid community solar and off-grid microgrids will likely start to blur. In many places, this will make it increasingly difficult to restrict the decentralization and democratization of energy.
Can the grid handle a transition away from coal and gas, to wind and solar?
There are a lot of smart people working on that question.
But in the long term, we know having a more decentralized grid makes for better resilience, and more reliability. Utilities are not always the most popular among everyday people, or people in the solar industry. But they are really good at keeping the lights on, and managing the grid, which is an incredibly complex system. This is the direction we need to be heading regardless, and a lot of the brainpower going into this transition will happen at that level too.
Regulators also have an important role in shaping utilities’ incentives to make this energy transition while also maintaining affordability and reliability. Changing utilities’ incentive structures is vital, so they’re not just paid high returns for continuing to build huge, centralized generation plans, and instead paying them to make the changes that serve their constituents, like transitioning to a cleaner, more decentralized generation, and upgrading software systems to maintain grid security and make crediting and billing systems run more smoothly and with less overhead expense.
So it's definitely something that will require transition, but I think is on its way. We're already seeing some utilities really get on board. As I said here are 18 legislated community solar programs. But there are 42 states that have at least one community solar garden. Those states where it’s not legislated are where the utility is taking the initiative, and they're doing this because it's a way for them to control that transition a little bit more. Instead of just having people put up projects wherever they want, or having to manage an increase in energy over their lines - from a neighborhood with a lot of solar, for example - they can choose to site a community solar array right next to their distribution infrastructure. They get to plan it out themselves, and often save on upgrades in the transmission system.
You mentioned the idea of decentralizing the grid, as the thing driving some of this change. Some critics point out decentralizing as a security risk. Is that something that you talk about?
I've heard some of the big utilities make the argument that increasing the number of people who are involved in this system - people like third party generators - may increase some cyber security risks on their end. I definitely trust that they know what they’re talking about, but growing data systems and the risk associated with that is a reality across many industries, and there are certainly ways to mitigate data security concerns. As an organization that is working with large energy companies on software for community solar gardens, I can tell you there are a lot of strict standards around data and software security that we have to deal with.
I think it’s also worth pointing out, though, that at the end of the day, if you end up with a system that is more decentralized, and what they call islandable, where basically, you could take a local energy grid, if the larger grid goes down for whatever reason, and power the local grid in a town, or a county, at a localized level, then you’re actually better off in terms of the resiliency of the overall grid, because it's harder to just hit one large piece of the grid, and take the whole thing down.
What policy needs to exist to make your work sustainable, profitable, compelling, incentivizing, etc.?
We do work at a state and local level because that's where we are seeing a lot of movement and innovation on the policy front. Solstice was founded to get as many people access to clean energy as possible.
Community solar addresses some of those needs, but there's also a whole set of barriers on the financial side. There are a lot of people that could theoretically get solar in some way, but who don't have the FICO credit scores, or the upfront savings to be able to participate.
One of the areas we focus on most closely are financial and policy innovations that empower those communities to participate. We are working under funding from the Department of Energy to develop an alternative to FICO, that's more specific to needs of community solar. We talk to people every day to try to get them connected to projects and so many have been paying their energy bill on time for decades, and just don't quite have a FICO credit score of 650 or 700 that they need to sign up. The people who are putting up the money for the projects would rather keep their risk low, and they see people with a FICO score below 650 or 700 as potentially to risky.
What we need to do is gather the data to show them otherwise, to show that someone who pays their bill on time every month is likely to pay their bill on time every month with a 10% discount.
We want to make something more accurate in saying, not can we rely on you to pay your mortgage, but will you pay your community solar bill on time? So we’ve come up with the EnergyScore, a machine-learning algorithm based on over half a million customer utility records. As I said, we've taken that aggregate data and made it into something that is both more accurate, in predicting people's future utility bill payment behavior, and more inclusive of low-income communities. We’re now testing it out in pilots in New York, and proving it out in a real-world context and using the data we collect to improve it, and we’ll be scaling it across the country in the coming years.
Image via Solstice
On the policy side, we're active in advocating for community solar programs, ones that will allow for third-party participation, for community-led solar projects, but also for policies that really encourage innovation on the inclusion front. Kelly Roache, our Director of Inclusion, has done amazing work building consensus between environmental and energy justice advocates like PUSH Buffalo and the NY Energy Democracy Alliance, as well as people in the solar industry, to push for policies that support financial inclusion, and that directly address the issue of finance. Two victories that Solstice has been a part of advocating for are winning a $21M pool of grant funding and a loan-loss reserve, and both of those went to support pilots innovating on low-income inclusion.
Our hope is that with this in place, we can work with communities in New York to prove that low-income folks can and should be full participants in the transition to clean energy, and scale that approach across the country.