On the Implementation and Performance of Water Rights Buyback Schemes

Abstract

Governments are increasingly reliant on the reacquisition of water rights as a mechanism for recovering overexploited basins. Yet, serious concerns have recently been raised about the efficacy and operational dimensions of existing programs. Water buyback is typically implemented as the purchase of a fixed quantity of water rights from the agricultural sector at the price set by the Water Authority. This paper seeks to analyze whether the use of water buyback in its current form represents a sensible means of recovering overexploited basins. The results-which are particularly relevant to contexts characterised by poor enforcement regimes and widespread illegal water use-highlight the need for greater scrutiny of current programs and call for additional work to improve the design of reacquisition policies in the context of water resource management.

Water buybacks to recover depleted aquifers in south-east Spain

“…The effectiveness of buyback schemes depends on both the existing level of overallocation of water rights and the enforcement of the water rights regime (Garrick et al, 2009;Marchiori et al, 2012). As in any other type of surface or groundwater trading, effective monitoring of water use and potential negative and environmental impacts is essential for successful implementation (Garrick et al, 2009;Skurray & Pannell, 2012).…”

“…As in any other type of surface or groundwater trading, effective monitoring of water use and potential negative and environmental impacts is essential for successful implementation (Garrick et al, 2009;Skurray & Pannell, 2012). Of special relevance is the control of illegal abstraction, as the purchase of rights creates an incentive to increase illegal pumping, which could make the reduction in water consumption smaller than the volume of purchased rights (Marchiori et al, 2012). As mentioned, the monitoring of groundwater use in the area of study can be considered good, so this issue is not considered relevant to the present analysis.…”

“…The unsustainable exploitation of aquifers is one of the most pressing water management and environmental problems in the Mediterranean (Scheidleder et al, 1999). As in many other areas around the world, over-appropriation of water resources, weak enforcement of water rights regimes and illegal pumping from aquifers are major factors behind the depletion of groundwater resources (Marchiori, Sayre, & Simon, 2012;Skurray & Pannell, 2012). In the Segura River basin in south-eastern Spain, one of the most profitable agricultural areas in Europe, the expansion of irrigation over the last four decades has put groundwater bodies under huge pressure and caused depletion to reach alarming rates in many aquifers (Martínez-Granados & Calatrava, 2017).…”

“…In some exceptional cases, Spanish water authorities have implemented payment schemes to reduce groundwater abstraction or used public water banks to buy back groundwater rights (Carmona et al, 2011;Garrido, Rey, & Calatrava, 2013;Marchiori et al, 2012;Montilla-López, Gómez-Limón, & Gutiérrez-Martín, 2018). In the 1990s, the Guadiana River Basin Authority implemented a system of agri-environmental payments to farmers for reducing abstraction from the over-exploited Western La Mancha aquifer (Carmona et al, 2011).…”

“…The public purchase of water rights is being increasingly used in some of the most mature water economies, like the United States (Garrick, Siebentritt, Aylward, Bauer, & Purkey, 2009;Ghosh, Cobourn, & Elbakidze, 2014;Hadjigeorgalis, 2009;Loomis, Quattlebaum, Brown, & Alexander, 2003) and Australia (Adamson & Loch, 2018;Bark, Kirby, Connor, & Crossman, 2014;Crase, O'Keefe, & Kinoshita, 2012;Docker & Robinson, 2014;Garrick et al, 2009;Wheeler, Garrick, Loch, & Bjornlund, 2013;Wittwer & Dixon, 2013), to reallocate water resources to environmental uses. Water authorities buy back water rights from water users, generally farmers (Marchiori et al, 2012). In contrast to payments for reducing extraction, this instrument has the advantage of permanently reducing abstraction.…”