Conflicts, Curtailments and Conversions: Lessons From the Historic Texas Drought

25th AnnualTexas Environmental Superconference

August 1, 2013Austin, Texas

Leonard H. DougalJackson Walker L.L.P.ldougal@jw.com • (512) 236-2000

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Introduction

1. Surface Water Curtailment in Brazos Basin

2. Brackish Groundwater Resource Conflicts and Development

3. Conversion of Agricultural Supplies to Municipal/Industrial

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Texas Reservoir Status – July 2013

Source: Texas Tribune/TWDB

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Prior Appropriation Doctrine“As between [surface water] appropriators, the first in time is the first in right.”

Water Code § 11.027

Brazos River Curtailment AreaThis map depicts the area of the Brazos River where junior surface waterrights have been curtailed.

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Surface Water Curtailment InBrazos Basin – Priority Call

•No Watermaster on the Brazos River•“Priority Call” By Senior Water Rights Holder

–TCEQ Suspends Water Rights Junior to Feb. 14, 1942–But, Order Excludes Junior Muni and Power Generation Rights–ED Cites Public Health, Safety and Welfare and New Rules

•Texas Farm Bureau Sues TCEQ–Challenges TCEQ “Curtailment Rules” (Ch 36)–Judge Jenkins Invalidates Curtailment Rules–Decision Now on Appeal

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Brackish Groundwater Resources• TWDB Estimates: 2.7 Billion Acre-Ft

– Brackish = 1,000 – 10,000 TDS– Represents “New Water” if Developed

• TWDB Estimates Desal Production Costs of

$1.09 to $2.40 per 1000 Gallons• Less Costly than Seawater Desalination • Currently 34 Operating Brackish GW

Desalination Facilities in Texas

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Growth of Desalination Capacity in Texas

Source: TWDB (includes both surface water and groundwater desalination plants)

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Brackish GW Development Policy Considerations• Who Should Regulate Brackish GW?

– Do GWCD’s Have the Knowledge and Resources to Regulate Brackish GW?

– How Do We Encourage the Development of Brackish GW?

• Need for Better Characterization of Brackish GW Aquifers (TWDB/BRACS)

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Conversion of Irrigation SuppliesTWDB Water Demand Projections (M AcFt/yr.)

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Conversion of SuppliesSAWS Deals• “Reverse Auction” to Purchase Edwards

Aquifer Rights• SAWS Stated Goal: “To Acquire an

Additional 10,900 acre-feet of Edwards Aquifer Water Rights in the Years to Come.”

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Conversion of SuppliesColorado Basin Example

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Conversion of Supplies:Hydraulic Fracturing Example• “It takes 407 million gallons to irrigate 640

acres and grow about $200,000 worth of corn.”• “That amount of water, could be used to frack

enough wells to generate $2.5 billion worth of oil.”

• “No water, no frack, no wealth,’ says Dr. Brownlow (who has leased his cattle ranch for oil exploration).”

WSJ, QuotingDarrell Brownlow, Ph.D.

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Conclusions• Priority System Affirmed; Legality of TCEQ

“Curtailment Rules” Questioned• Brackish Groundwater Is a Vast Resource;

Policy Changes Needed to Spur Development

• Irrigated Agriculture Will Decline as Water Moves to Higher Value Municipal/Industrial Uses

QUESTIONS?

Leonard H. DougalJackson Walker L.L.P.

100 Congress Avenue, Suite 1100Austin, Texas 78701

Telephone: (512) 236-2000ldougal@jw.com