Recent Applications of Agricultural Water Models

Duncan MacEwan

ERA Economics

California Water and Environmental Modeling ForumTechnical Workshop

Economic Modeling of Agricultural Water Use and Production

January 31, 2014

Some important points Integration with other models

Evaluate simultaneous (and inter-related) policy changes

Linkage to I/O models Motivating the analysis

Key question and client needs Political sensitivity Important innovations

Data requirements Time consuming and difficult

Examples Yolo Bypass Water Markets Other recent applications

Yolo Bypass – Motivation Policy application

› Client: Yolo County and now Reclamation› Evaluate economic impacts of changes in

the frequency and duration of bypass inundation

Data requirements› What is grown in the bypass, and where?› Crop budgets› Flood inundation footprint

Key considerations› Spatial scale › Grower planting decisions

Yolo Bypass – Application Model framework

› Bypass Production Model Regional agricultural economic model

› HEC-RAS Other models

› DayCent Crop growth model

› IMPLAN Multiplier effects – jobs, taxes, value added

Data DAYCENT Model BPM IMPLAN Results

CM2 February 15 March 24 April 10 April 30 May 150

500

1,000

1,500

2,000

2,500

3,000

3,500

4,000

4,500

Value Added Losses with 3,000 cfs (in thousands)

Direct Indirect+Induced

CM2 February 15 March 24 April 10 April 30 May 150

1,000

2,000

3,000

4,000

5,000

6,000

7,000

8,000

9,000

10,000

Value Added Losses with 6,000 cfs (in thousands)

Direct Indirect+Induced

Yolo Bypass – Summary Key results

› Linkage: Flood – Crop Growth – Economics› Coordination with bypass landowners› Comprehensive data collection

Engage stakeholders for project approval

Water Markets – Motivation Policy application

› Use the SWAP and CALVIN models to evaluate South-of-Delta drought water markets

› Using 2009 drought as an example Data requirements

› Standard SWAP data requirements› Linkage to CALVIN› Transfer capacities and constraints

Key considerations› Evaluate the economic and hydrologic gradient

of water transfers› Water in California varies greatly by space and

time

Water Markets – Application Model framework

› SWAP Agricultural economics

› CALVIN Transfer capacities and system linkage

Calibrate against standard SWAP data Policy evaluation

› 2009 drought› Groundwater replacement› Local supplies

South of the Delta Water Trade Analysis

  Export Regions

Import

Regions

(V11)Stanislaus

River

(V12)Turlock

(V13)Merced

(V14B)SW Kings

County

(V15A)Tulare

(V17)Kings River

(V21A)Kern

Total Imports (AF)

(V10)SJR Exchg Contractors

17,587 53,186 22,109 0 0 0 0 92,882

(V14A)Westlands

0 0 0 13,665 70,000 0 0 83,665

(V15B)Castaic Lake Area

0 0 0 0 16,270 0 0 16,270

(V19A)Kern

0 0 0 0 0 0 68,121 68,121

(V20)Kern

0 0 0 0 0 0 0 0

(V21B)Kern

0 0 0 0 0 0 15,747 15,747

(V21C)Kern

0 0 0 0 0 0 6,513 6,513

Total Exports 17,587 53,186 22,109 13,665 86,270 0 90,381 283,197

No market adjustment› Revenue loss $512 million

Local market effects› Water traded 283 K Ac ft› Net revenue gain $109.5 million

Water Markets – Summary Key results

› New market links require new market institutions

› Important to let economic gradient inform water transfers

Linkage between SWAP and CALVIN

Other Applications I Santa Clara Valley Water District

› Economic impacts of changes in the agricultural groundwater charge

Solano County› Economic impacts of BDCP Conservation

Measure 4 Solano County and Cache Slough ROA

Diageo Wine Supply and Demand› Model of wine supply chain management

and response to market shocks

Other Applications II Salinas Valley Model

› Genes to Growers USDA project› Integrate agronomic information into

Salinas Valley model to evaluate changes in nitrogen and water use efficiency

SWAP – Groundwater Dynamics› Project under way to link SWAP and

C2VSim CVP - Integrated Resource Plan

› SWAP model linkage to: Water, climate, costs, demands, and urban

growth

Other Applications III North of the Delta Offstream Storage

Investigation› SWAP model update and application to federal

feasibility analysis› National Economic Development (NED) Benefits

Summary Workbook Pre-processing adjustments

Consistent interest rates Disaggregate input cost data Power costs

Post-processing adjustments Input costs Fallow land costs Management charge Federal discount rate Normalized crop prices

Summary Example applications highlight:

› Integrated modeling capabilities› Project-specific motivating factors› Data requirements

Applications in progress:› Remote sensing, calibration methods,

dynamics Richard Howitt @ 4pm