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5 Legal, Economic, and Other Institutional Considerations
Pages 181-222

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From page 181...
... As discussed in this chapter, although economic studies have been performed on various aspects of MUS (e.g., the economics of groundwater use or of artificial recharge) , little has been published in terms of formal studies of the economics of MUS versus other forms of water storage and water management.
From page 182...
... . Those who would invest in MUS projects need to capture and internalize benefits from their investments.
From page 183...
... Laws allocating water quantities among uses and users are discussed in the following subsection, followed by a discussion of water quality concerns.1 MUS and the Regulation of Water Use Well-understood and characterized rights of water use are essential for MUS projects to be considered feasible options for water management. Most states' water rights systems were developed long before groundwater storage was contemplated.
From page 184...
... • The timing and rate at which stored water can be recovered to prevent water quantity-related aquifer management concerns, such as well interference or other impacts of neighboring well users, and stream depletions or other surface water impacts for tributary aquifers • The type of use to which the recovered water can be put Water Quality-Related Activities • Protection of the quality of the native water in the aquifer from impacts by or deg radation from interactions with the water to be recharged; if recharge is by well injection, this is typically regulated under the federal Underground Injection Con trol program • Protection of the quality of the water being stored from impacts by or degradation from interactions with the surrounding native water in the storage aquifer, particu larly if the intended post-recovery use of the stored water is for potable purposes • Protection of the aquifer matrix from physical impacts resulting from chemical in teractions between the stored and native waters, such as precipitation of metals and resultant clogging of aquifer pore spaces (this can also be viewed as a water quantity-related issue, and regulated by a water resources agency because these impacts can reduce aquifer productivity for other well users) • The construction and maintenance of wells, including well casing and wellhead, to prevent movement of water between aquifers and water and to prevent con taminants from entering the aquifer unintentionally • The construction and maintenance of surface recharge facilities Land Use • Ownership of and/or access to land for surface recharge • Ownership of and/or access to land for well installation, operation.
From page 185...
... where groundwater resources have been overdrafted or where negative impacts such as well interference, seawater intrusion, or land subsidence have necessitated a more active regulatory and regional approach. The legal context for MUS projects in the eastern states is thus comprised of the overlaying of permit systems and critical area designations on the existing riparian rights rules for surface water and correlative rights rules for groundwater.
From page 186...
... MUS projects typically involve the movement of surface water into groundwater and thus there is a need to reconcile legal systems that typically do not integrate these differing concerns. In states where rights for use of surface water differ from rights for use of groundwater, some adjustment of water rights rules may be necessary for the holder of a surface water right to be able to legally store some of that water underground and pump it out later.
From page 187...
... The Oregon statute does not require that aquifer storage and recovery projects have discharge permits,4 and declares that water stored in ASR projects will not be considered a waste, contaminant, or pollutant.5 Idaho established through legislative action that the storage of water is a beneficial use, and that permits can be issued for the capture and storage of unappropriated water, in effect creating a secondary water right.6 Idaho's approach recognizes that such projects may simply recharge groundwater supplies, whereas Oregon's approach mandates that water would be retrieved from the aquifer.7 In 2005 the Kansas Division of Water Resources promulgated regulations to establish a permitting process for ASR projects.8 Project applicants must seek and obtain two types of appropriation permits. The first permit is for appropriating the surface water that will be stored underground.
From page 188...
... 2. Allow for the efficient and cost-effective management of water supplies by allowing the use of storage facilities for filtration and distribution of surface water instead of constructing surface water treatment plants and pipeline distribution systems.9 The storage facilities cannot impair vested water rights, and the applicant for a water storage permit must have a right to the proposed source of water.10 Unlike Oregon, Idaho, and Arizona, California does not have a comprehensive act for the underground storage of water.
From page 189...
... . It may not be necessary to rewrite state water codes in order to facilitate underground water storage, but state policy makers considering the promotion of underground storage are well advised to review current state regulatory requirements and processes in order to assess the extent to which they inhibit the planning, economic feasibility, and practical execution of MUS projects.
From page 190...
... content of less than 10,000 mg/L -- and if the water is being stored in the aquifer by means of injection.15 Injection systems are regulated under the federal Safe Drinking Water Act's (SDWA's) Underground Injection Control (UIC)
From page 191...
... (2) of the Safe Drinking Water Act: "Underground injection endangers drinking water sources if such injection may result in the presence in underground water which supplies or can reasonably be expected to supply any public water system of any contaminant, and if the presence of such contaminant may result in such system's not complying with any national primary drinking water regulation or may otherwise adversely affect the health of persons." The implementing regulations put the burden of proof on the applicant to demonstrate compliance: 40 CFR 144.12(a)
From page 192...
... This provides some leeway from the strict interpretation that there can be no violation of a primary drinking water standard." (Florida Department of Environmental Protection, 2006) Although the UIC program and the Safe Drinking Water Act provide a national framework for regulating the quality of water introduced directly to drinking water source aquifers, UIC and other groundwater protection programs can and do vary from state to state in their structure and in their application to recharge projects.
From page 193...
... If at any time the Department learns that an existing Class V well may cause a violation of primary drinking water standards under Chapter 62-550, F.A.C., the Department shall, as determined by following the process in Rule 62-528.100(2)
From page 194...
... EPA regulation of MUS remains a relatively small component of a UIC regulatory system dealing with much more significant projects of a different type.20 Several additional policy questions arise out of state groundwater protection programs and the application of UIC regulations at the federal and state level, with various regulatory approaches and site-specific issues, particularly where secondary drinking water standards are concerned. Two examples are point-ofcompliance and antidegradation policies.
From page 195...
... .22 Some states prohibit any degradation in water quality in an aquifer, even when both the source water and the water in the aquifer meet all drinking water standards. Such a stringent rule can impede an MUS project by imposing costly pretreatment requirements, or even prohibit MUS altogether.
From page 196...
... There would be a monetary cost for using freshwater instead of recycled water. In addition, there would be an environmental cost to develop the freshwater supply, such as the construction of storage facilities or increasing diversion of freshwater supplies from the Sacramento-San Joaquin Delta and other surface waters where beneficial uses are impaired due to diversion-related reduced flows.
From page 197...
... In general, ADEQ regulates groundwater quality and ADWR manages groundwater supply. All aquifers in Arizona currently are classified for drinking water protected use, and the state has adopted National Primary Drinking Water Maximum Contaminant Levels (MCLs)
From page 198...
... The draft regulations, portions of which are summarized in Table 5-1, include requirements for -- among other things -- source control, water quality, treatment processes, recharge methods, dilution, operational controls, distance to withdrawal, time underground, monitoring wells, and preparation of an engineering report. The criteria are intended to apply only to planned groundwater recharge projects using recycled water (i.e., any water reclamation project planned and operated for the purpose of recharging a groundwater basin designated for use as a domestic drinking water source)
From page 199...
... 600 m (2000 ft) b separation Regulated Contaminants Drinking water Meet all drinking water MCLs (except nitrogen)
From page 200...
... Any intentional augmentation of drinking water sources with reclaimed water in California requires two state permits. A waste discharge or water recycling permit is required from a Regional Water Quality Control Board (RWQCB)
From page 201...
... ƒ 12 mg/L NO3 (as N) ƒ No detectable fecal coli forms/100 mL Groundwater recharge via ƒ 20 mg/LCBOD5 ƒ Secondary RIBs in unfavorable condi- ƒ 5.0 mg/L TSS ƒ Filtration a tions ƒ Primary and secondary ƒ Disinfection drinking water standards ƒ 10 mg/L total N ƒ No detectable total coli forms/100 mL ƒ Secondary ƒ 20 mg/LCBOD5 ƒ Filtration Groundwater recharge or ƒ 5.0 mg/L TSS ƒ Disinfection injection to groundwaters ƒ 3.0 mg/L TOC ƒ Multiple barriers for conhaving TDS < 3,000 mg/L ƒ 0.2 mg/L TOX trol of pathogens and or ƒ 10 mg/L total N ganics a ƒ Primary and secondary ƒ Pilot testing required drinking water standards ƒ No detectable total coli forms/100 mL Groundwater recharge or ƒ 20 mg/L CBOD5 ƒ Secondary injection to groundwaters ƒ 5.0 mg/L TSS ƒ Filtration having TDS 3,000-10,000 ƒ 10 mg/L total N ƒ Disinfection mg/L ƒ Primary drinking water a standards NOTE: CBOD5 = carbonaceous biochemical oxygen demand ; TOX = total organic halogen; TSS = total suspended solids.
From page 202...
... Following similar logic, residence time criteria are being developed at the state level for MUS with reclaimed water. For example, California's proposed groundwater recharge regulations (Table 5-1)
From page 203...
... . Furthermore, an MUS project's possible impacts -- on overlying lands, hydrologically interconnected surface water bodies, related habitat, water quality, and water use -- stretch across the agendas of multiple state and federal agencies.
From page 204...
... There may be offsetting benefits from the involvement of multiple organizations in an MUS project.26 Public agencies or private organizations that focus on water project operation, water quality monitoring, or administering pumping rights and managing the storage space in an aquifer may exhibit returns to scale or from functional specialization that offset or even exceed the transaction costs of coordination. Organizations such as water associations or special districts at the basin or watershed scale can even ease or overcome coordination problems and enhance the opportunities for MUS.
From page 205...
... Legal or other institutional barriers that inhibit coordination among flood control agencies and other public or private organizations involved in water resource management impose substantial transaction costs with no certain offsetting benefits. In most locations, flood control facilities, surface water storage reservoirs, and underground storage projects can operate in complementary ways or satisfy multiple goals.
From page 206...
... The district succeeded in acquiring supplemental surface water supplies from the federal Central Valley Project, the State Water Project, and the Kern River. The quantities supplied vary significantly from year to year and from season to season depending on runoff conditions.
From page 207...
... . Fortunately, the economics of managed underground storage can easily be integrated into the framework that these principles provide.
From page 208...
... As water tables decline, eventually a point is reached where the costs of additional extractions are greater than the benefits associated with any of the uses to which the water may be put, at which point the aquifer is said to be "exhausted economically" even though it still contains some water. When it is no longer economical to extract water, pumpers either stop extracting it or reduce the quantity extracted.
From page 209...
... Inasmuch as MUS entails groundwater storage and is not intended to affect groundwatersurface water interactions, the discussion that follows focuses on the economics of MUS and abstracts from groundwater-surface water interactions. The formal economics of groundwater management and use reveals an important conclusion for MUS.
From page 210...
... There are a number of pioneering examples of the use of MUS in lieu of surface water storage or to help manage highly variable flows from surface water sources, including storage. Two of these in California, the ArvinEdison Water Storage District and the Rosedale-Rio Bravo Water Storage District, are described in Boxes 5-4 and 5-5, respectively.
From page 211...
... In effect, the stabilization of groundwater levels permitted the district to continue to serve a significant proportion of its users with groundwater and thereby avoid the considerable expense of a surface water delivery system for the groundwater service area. Third, in the area that is served with surface water, groundwater is available to growers in drought years when surface water deliveries are reduced.
From page 212...
... The financing of groundwater management and managed underground storage is discussed fully in Chapter 6. That discussion identifies the critical variables affecting financial feasibility and generally characterizes the importance of financial drivers in determining the feasibility of specific managed underground storage projects The Economics of Multiple Objectives There are several possible objectives for any project or process of artificial groundwater recharge.
From page 213...
... These imperfections are likely to be present with some frequency in MUS projects. Spillovers or externalities are said to occur when an economic transaction results in impacts on a person or persons who are not party to the transaction.
From page 214...
... Inasmuch as artificial recharge and augmentation of storage may have positive impacts on environmental amenities and services, it is important to recognize the need to value these and other benefits that may not be traded in markets. The fact that water itself rarely has a market-determined scarcity value means that comprehensive economic valuation of artificial recharge schemes will require the use of alternative valuation methods.
From page 215...
... In that circumstance the costs would likely be significantly higher than the value of the use and would raise compelling questions about the economic justification of the project. The result is that the attractiveness of any MUS project depends on the costs of alternative sources of supply as well as the value of the product water in its final uses.
From page 216...
... Managed underground storage is likely to be far more attractive in the future because low-cost water supply options are no longer available in many regions and locales and, because high-valued uses are growing in many expanding urban areas and in those regions where source water can be obtained relatively inexpensively and costly treatment can be avoided. Subsidies Frequently, the high costs of providing water supplies or remediating and enhancing water quality result in calls for public subsidy in order to make the project or program "affordable." Often, advanced techniques of augmenting water supplies such as desalination, wastewater reuse, or groundwater recharge appear very costly in comparison with the costs of established alternative water sources.
From page 217...
... Another pertinent example is the case where an artificial recharge operation augments storage and repels the advance of a contaminant plume thereby protecting the quality of the groundwater for all pumpers. In this instance, protecting its quality for one protects the water quality for all, and the gain in water quality protection cannot be withheld from an extractor who refuses to pay for it.
From page 218...
... Also, there are inconsistencies between the Clean Water Act and the Safe Drinking Water Act that impact MUS systems. For example, some jurisdictions try to control surface water contamination problems by diverting polluted water from aboveground to groundwater systems.
From page 219...
... Therefore, weighing water quality considerations together with water supply concerns, conservation, and public health and safety needs is an essential plan of action. Rigid antidegradation policies can impede MUS projects by imposing costly pretreatment requirements and may have the practical effect of prohibiting MUS even in circumstances where the prospects of endangering human or environmental health are remote and the benefits of water supply augmentation are considerable.
From page 220...
... Sacramento, CA: California Department of Health Ser vices, Drinking Water Technical Program Branch. Challen, R
From page 221...
... 1984. Guide lines for improved institutional analysis in water resources planning.
From page 222...
... 1985. Economic aspects of groundwater recharge.


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