A BLUE DOT FROM SPACE FORESHADOWS OUR FRESHWATER SUPPLIES

The high resolution images from the spacecraft Artemis struck me as I am sure they did all of you. Our blue world seen from halfway to the moon is unlike any celestial body in our known universe. The photos broadcast abundant water. But, do they?

Water covers 71% of the Earth’s surface, yet only around 3% of that is freshwater and of that small percentage less is truly “fresh enough” for human consumption and agriculture.

Roughly a quarter of the Earth’s population (2.4 billion) lives with water stress. That is expected to climb to nearly a third by 2050. Water stress is far beyond what we typically label water scarcity. By water stress, we are talking about demand (usage) exceeding supply. And climate change is playing havoc on even those models.

The impacts of water stress are economic, social, environmental, agricultural and even geopolitical. When a country loses its ability to sustain its population, civil strife and the international order are threatened.

A host of terms are bantered around: Water stress, water bankruptcy. They all label the same problem. When water demand exceeds water supply, economic insecurity and food insecurity result. Food stocks are affected (agriculture accounts for 70% of the world’s freshwater usage).

In observing our planet from afar, the solution may seem obvious: Desalination. It isn’t. First some words about the process of desalination. Desalination is the removal of TDS (total dissolved salts…think calcium, magnesium, sodium) either by heating water to vapor or forcing high TDS water through membranes, a process typically referred to as reverse osmosis or RO. To do either requires energy and the production of energy is not only costly, but itself consumes freshwater (the exception being power generation by certain renewables like geothermal, wind, and solar that do not consume water).

Two sources of water are candidates for desalination: Brackish water and seawater. Brackish water is usually found underground and ranges in TDS from 1,000 to 10,000 mg/liter. Seawater’s TDS level is roughly 35,000 mg/liter. The higher the TDS level the more pressure (energy) is needed to force water through the membranes.

Brackish water desalination means the plant need not be near a coastline. That’s the good news. The bad news is that the process results in a concentrated stream of high TDS water that must be disposed of. That usually means deep well injection or returning the water to the ocean.

The US has constructed over 400 desalination plants just since 1970, with the Carlsbad, California plant being the largest (54mgd or roughly enough to supply 400,000 people). The plants are primarily sited in California, Florida, and Texas. Take Texas as an example, of its 31 aquifers, 27 are considered brackish and that’s where it employs desalination. Florida leads the nation in desalination plants (over 130 plants, mostly brackish desal but some seawater).

A problem of desalination is taste. RO water has a taste, a bit flat and oily. Take a sip of distilled water and you will see what I mean. It’s best blended with other sources to eliminate the taste factor.

For some countries, it is their only option. In Israel, 65% of the domestic water supply comes from desal. In the UAE it’s 50%. In Kuwait, its 90% and in Qatar its 99%. My March 15th Substack focused on the targeting of desalination plants in the Iran War . While a war crime under the Geneva Conventions, that hasn’t stopped Iran from hitting its neighbor’s desal plants (or hitting the electrical generating lants that power them). The US has threatened to target Iran’s plants (and apparently hit one). Desal plants have become very vulnerable targets of opportunity just as a 2010 CIA report forecasted. But with water essential to life, hopefully, cooler minds will prevail.

The serene view of Earth from 120,000 miles away shows possibilities. It’s time that the rest of us on this rock focus on the positives as well. A third of a billion people are counting on that.

IN AND OUT LIKE A LAMB. A RANT ABOUT THE COLORADO RIVER’S SUPPLY

2026 is simply unprecedented in terms of water supply. Mid-80 degree temperatures at high elevations in the Colorado Rockies in March. It’s never happened, and in March elevations above 7,000’ have seen weeks of 70-85 degree days. Eighties are temperatures usually reserved for a few days in July and August. The entire month of March has been dry and warm, too warm. The long term NOAA forecast isn’t any better.

Colorado’s nickname is the Mother of Rivers. Snow in the Rockies isn’t just about winter sports, pristine camping, and fly fishing scenes found in the movies. The Rockies capture snowpack that melts throughout the year birthing major rivers like the Colorado, Arkansas, Platte, Republican, and Rio Grande. Colorado’s snowpack is crucial to over 40 million people across the West.

For those in the west, snowpack is a common term everyone in the West follows. To the farmer, cattleman, or resort worker it’s economic security. To the wildfire responders, it’s a harbinger. So where are we as we end what was supposed to be the snowiest month in the Rockies?

Snowpack and water content monitoring as of this writing are at historical lows. Some basins are at as little as 7% of normal. The Colorado headwaters are hovering at around 33% of normal, a historical low. The Gunnison is less, at 21% and the Rio Grande in Colorado is just 16%. Utah is no better. In fact, several basins in Utah are between 11% and 29% of mean. One is recorded at 0% of normal, which is hard to comprehend. The Little Colorado in Arizona is 14% and the Salt Basin (which supplies Phoenix and its suburbs) is at 5%.

A small minority say, wild swings between wet and dry years are normal. It used to be. Heavy and light snow years were a normal climactic pattern. The droughts of 1954 and 1977 compelled ski areas to install snowmaking and water planners to change strategies. The heavy snow years of 1921, 1971, 1972, and 1981 were epic, exceeding 400 inches of snow in Colorado. In the last 26 years, we have seen 19 dry years, five years being among the driest in history. Dendrochronology (the science of tree rings) reveals the period between 2000-2026 has been the driest period in the last 1,200 years. In the same period, temperatures have risen in the Rockies by an average of 2˚F. That may not sound like much but until you understand that the amount of energy required to create that increase equates to eight times the total energy consumed by every human on the planet in a year. Heat is energy and increased atmospheric energy results in stronger storms and more severe droughts.

As a water attorney, people ask me what they should do. There are proactive steps, each being unique to the needs and resources of the water user, but for most, it’s too late. Those with senior water rights on side tributaries may see curtailments and reductions they have never seen due to the simple fact the streams are dry. Those with senior water rights on major rivers will likely be fine. Those without senior water rights will very likely experience a summer unlike anything they have experienced.

Couple low water availability with soil moisture content levels never seen before and it’s going to be a tough summer. And it won’t be confined to irrigators and municipal providers. Lake Powell, one of the two major regulating reservoirs in the Colorado River, is predicted to drop to 3,490 feet, the minimum power pool, perhaps as early as August. As of today, it’s only 39 feet above that level. It could mean Lake Powell stops generating electricity for five million users. The loss of 1,320 megawatts of generation will further tax the western grid.

Upper Colorado River reservoirs like Blue Mesa and Flaming Gorge can contribute some to Lake Powell, but not enough. Why is this important besides power generation? Lake Powell is the regulating reservoir between the Upper Basin States and the Lower Basin states under the Colorado River Compact. Water use (or non-use) in Arizona and Nevada is directly tied to the level of water in Lake Mead, the other major storage facility on the Colorado River. With Mead at 34% of capacity, additional pain will be felt in Arizona and Nevada.

It’s going to be a challenging summer. Stay tuned.

ELECTRICAL FAILURE: THE IRONY OF THE IRAN WAR

Let’s talk economics and pocketbooks. Affordability is on everyone’s mind as inflation and gas prices continue to climb. One in six Americans are behind on one or more of their utility bills. The highest of those bills is electricity. President Trump ran on the promise to lower grocery bills and electric bills “by half” in his first year if elected. It hasn’t happened. Electric bills have risen between 6.4% and 23.1% in the last twelve months depending upon where you live.

Why have electric bills risen higher than inflation? Costs can be traced to a number of factors: 1) The rising costs of infrastructure due to tariffs; 2) the demands of AI and datacenters; and 3) general inflation. But the greatest accelerant on costs is bad policy.

Even without subsidies and tax credits, solar, wind and geothermal are dramatically less expensive than fossil fuels to generate electricity. According to the government’s own figures, verified by industry sources, onshore wind and solar cost roughly $37-$78 per MWh. Contrast that to coal ($70-$170/MWh), natural gas ($50-$100/MWh), and nuclear ($140-$220/MWH). Offshore wind is tagged at $70-$112/MWH.

Because of the economics, utilities and industry have favored a mix of solar and wind with backup high-efficiency (combined-cycle) natural gas. But rather than follow market forces and rational energy policy, we are now faced with a layer of “bad policies” that increase costs.

The current administration’s war against renewables is costing consumers. I’ll give an example. The administration is negotiating an agreement with the French wind production company TotalEnergies which is developing offshore wind. The proposal is to pay TotalEnergies nearly $1 Billion ($928m) to not build the Attentive Energy and Carolina Long Bay wind projects (essentially to compensate for cancelled Interior leases, analogous to condemnation). TotalEnergies then would commit to considering development of natural gas infrastructure in Texas. Think about that, nearly a billion dollars in taxpayer dollars (your money) not to generate electricity, with nothing in return… because of a philosophical grudge.

Beyond government interference in the free market capitalist system, all this does is add in another layer of pain to consumers. But there is one (sort of) bright side of the chaos. America is entering into its fourth week of the Iran War. The war highlights the dangers of a world dependent on fossil fuels. Gas prices are up as much as 14% as a result in portions of Europe. Here in the U.S. the increase is higher, as much as 30% in places ($.90-$1.00/gallon increase). Natural gas prices in Europe have skyrocketed. The only country to have benefited looks to be Russia.

The vulnerability of economies to Middle East disruption will act as a catalyst in the development of renewable energy as countries move to renewable energy as a security imperative. The irony is that the Administration’s war in Iran may well defeat its war on renewable energy sources.

TARGETING WATER IN THE IRAN WAR

Four months ago, my Substack addressed Iran’s water crisis. A State of Failure: The Coming Unrest in Iran. https://bit.ly/472BF54 Decades of mismanagement coupled with the effects of climate change caught up to Iran. Over-consumption, groundwater over-use, and prolonged drought set the stage for Tehran, a city of ten million, to run out of water. In a country where over 86% of the population is below 54 and over 75% are urban and well educated, it seems almost implausible that such a self-inflicted wound could occur.

The recipe for civil unrest and regime change was incubating.

Then came America’s war that is now in its third week. History has shown that regime change wars often backfire with the populous rallying around regimes they otherwise do not support when a country is attacked. Will that happen in Iran? It’s too early to tell and the answer may be guided by how long the war lasts and how the war is conducted.

Desalination plants are the backbone of middle eastern water supplies.  Water is the most coveted resource in this oil rich region. Over 400 desalination plants operate in the gulf. Iran has (had) 75 operating plants at the outbreak of the war. Unlike its neighbors, Iran’s reliance on desalination is relatively low, only about 5% of its total water use. Contrast that to the six nations of the Gulf Cooperation Council (Bahrain, Kuwait, Oman, Qatar, Saudi Arabia, and United Arab Emirates) where some countries supply more than 90% of their potable drinking water from desalination.

So, it’s a big deal when the war targets desalination plants. Iran claimed an Israeli/American attack against its Qeshm Island desalination plant (both Israel and the US denied responsibility). Bahrain alleged an Iranian drone hit one of its desalination plants. More importantly, desalination plants can’t function with the presence of even a small amount of oil in the water; as tankers and refineries spill oil into the gulf from attacks, risks to critical water infrastructure are multiplied.

Few would argue that water is indispensable to life. Humans are fragile, capable of living only 3-7 days without water. The Geneva Conventions (IV Convention, 1949), UN Security Council Resolution 2573 (2021), and International Humanitarian Law (overseen by the ICRS), all make it a war crime to “attack objects indispensable to the survival of civilian population.”  That’s drinking water and drinking water infrastructure.

While sounding like an oxymoron, there are moral and legal limits to the conduct of war. Beyond the consequences of international law, there are the social and political repercussions of conducting war in a manner that attacks and alienates the civilian population. If a goal is regime change, how war is conducted is critical. Extreme care should be given to avoid any attacks of civilian water infrastructure.  Iran was already in a water crisis that was the number one topic of dissent of its population before the war. Lack of water was foremost on the Iranian mind. As a result, Iran was teetering on edge of regime change before February 28.

It would indeed be ironic if the conduct of the war resulted in the population coalescing around a failed regime for a lack of fresh water and other critical infrastructure.

THE COLORADO RIVER: FRESH OUT OF EASY OPTIONS

The legal framework behind the Colorado River’s division between the states is predicated on flawed assumptions compounded by unforeseen conditions.

The “Flawed Assumptions:”

1)    When the Colorado River Compact was signed in 1922, the Colorado was assumed to flow in an average year over 16.5 million acre feet. The science behind that was predicated on a review of a snapshot of a few decades that turned out to be among the wettest in over 800 years.

2)    Arizona cut a deal in Congress in the late 1960s to secure funding for a billion dollar canal system that brought its share of the Colorado inland to the cities of Phoenix and Tucson. In return for funding, Arizona agreed to take a junior priority assuming a prolonged reduction in flows would never occur.

The “Unforeseen Conditions:”

1)    Climate change has decreased the flow of the river and increased evaporation and crop demand by as much as 20%.

2)    With the advent of air conditioning and abundant real estate, the shift in population to the Southwest has increased its population by ten times since the Compact was signed.

Agriculture in Arizona has been cannibalized. Lawns and parks have been ripped out in Nevada. Water utility bills in Las Vegas can reach $1,000/month. Golf courses are universally supplied with effluent and state of the art metering and low water fixtures have been mandated. Communities in Arizona are buying-up groundwater they know has a finite lifespan (under 100 years or three mortgage terms). Band-Aids that surely will hurt when removed.

It’s not enough. Hard questions loom. Should growth be curtailed? Why should California agriculture (that uses nearly half of Colorado’s entitlement) be fallowed for the benefit of Arizona and Nevada? And what would that agricultural disruption do to the nation’s food supply?

Climate change is having an exponential effect, none of it positive. In the past quarter century only about a quarter of the years resulted in average or above average water years. 2026 threatens to be the driest of record. And with those successive years of drought, soil moisture is at an all-time low.  At this point, it would take decades of successive high water years to replace the loss and the climate models all show a hotter, drier future.

Options exist with cooperation and massive funding. Desalination is looked at. Ideas floated are to have Arizona and Nevada fund billions in desal in California in return for California allowing Arizona and Nevada to take a portion of California’s entitlement (No one is ever going to bring a pipeline to Arizona or Mead, that is a “duh” thought when an exchange is far easier and cheaper). A decent idea but if anyone has ever observed the California Coastal Commission, they know running pipes from the ocean is a pipe dream.

Our President blames politics for western water woes, claiming all that that needs to be done is throw a valve and water will flow down from Northern California and Oregon. NEWS FLASH: North on a map does not mean uphill. Another “duh” thought.

No, there’s no easy and cheap solution. It will require creative minds, cooperation, and money. Lots of money. America has always thought of water as a social good. Utilities are structured to pass water on to the consumer without profit at the lowest rate possible. A household pays $300-400 a month for electricity but screams when their water bill is raised to $50/month. Our future will require water to be viewed at least in part as a commodity that costs money to develop, treat and distribute. Water rates will need to rise.

We also need to stop thinking politically and parochially. It’s not left and right. It’s not  “my water.” We need to think less in terms of Californian’s versus Arizonians, Coloradoan’s versus Arizonians, or Oklahomans versus Texans. We’re all in the same damn boat. We are Americans and history has shown that when we get together, we usually can solve big problems.

It’s going to take that mindset.  

PERSPECTIVES ON HYPERBOLE: GENERATING POWER

Last week I left off with the question of electrical generation and water. Today’s article will discuss how we generate electricity and how we got here. It’s a storied past and not one many of us would have expected. First, how is electricity generated? With the exception of geothermal, wind, hydro, and solar, fuel is used to heat water to generate steam to spin turbines. The result is a burning of that fuel (nuclear, coal, natural gas) creating steam from water, resulting in water consumption.

In the U.S., roughly 60% of the fuel is fossil (mostly natural gas with some remaining coal). Nuclear makes up 19% and the balance is renewables, mostly wind, solar and hydro. The mix varies by country and region. For example, Europe’s mix is 17% natural gas, 12% coal, roughly 22% nuclear, and 45% wind and solar, with some geothermal.

To some extent the mix is driven by available indigenous resources. The U.S. is the leading producer of oil and natural gas in the world. It also is the second largest producer of renewable energy. The U.S. is the second largest emitter of CO2, just behind China that overtook that honor from the U.S. in 2006. China has now embarked on a mandate to wean itself from coal and natural gas to renewables with a 2060 carbon neutral goal.

The U.S. has become the only country to openly politicize climate change. George H.W. Bush strengthened the Clean Air Act and spoke on the threat of climate change, before political pressure caused him to walk away from the 1992 Rio de Janeiro Earth Summit. In many ways that was a turning point but it was in many respects an honest one. Why? Climate change was acknowledged as a real threat but the costs of combating it were honestly debated. Today, some dishonestly label climate change a hoax rather than truthfully debating the costs of meeting the threat.

But politics has little to do with economics. While executive orders and the repeal of E.P.A.’s endangerment finding have real world consequences, they do not have the effect most believe. Industry, corporate governance, and utilities take the longer view where risk and cost replace political theatrics.

Even without subsidies and tax breaks, the costs of renewables are dramatically cheaper. Compare an average cost of $33.00/MWh for onshore wind and $44/MWh for solar to a new combined high efficiency gas generation plant at $77-130/MWh. Coal is dramatically higher. For new nuclear plants, the cost is even higher (and disposal of spent uranium fuel is an unknown cost).

Industry and utilities see the advantages not the politics and combine natural gas with renewables for a lowest cost approach. While renewable battery storage costs are rapidly declining, for now, adding in their cost equalizes the playing field such that we are still in a hybrid environment where natural gas and renewables offer a combined lowest cost alternative.

That’s the fuel side of generating power. But what about the water side? Solar, wind, and geothermal need virtually no water to generate electricity. Nuclear requires between 300 and 800 gallons/MWh (depending on the cooling system used). Natural gas uses an astonishing 2,800 gallons/MWh. For perspective, one MWh can power 30-40 homes for a day (at 2,800 gallons/MWh per day that’s 1.022 million gallons/year for just those 30-40 homes).

These are the factors that weigh on utilities and corporations, not political hyperbole.

AN ILLUSION OF SNOW

Images of western snowfall in the last week belie the truth. Tragic avalanche deaths and ski areas closed by too much snow can be deceiving. While areas near Tahoe have been pummeled by up to 120 inches of snow so far in February, the Colorado River basin is a far different story.

Latest snow level and water content reporting is not for the weak a heart. Colorado ski resorts received a boost this week with new snow but it did nothing to solve the multi-decade drought that has dried the seven states in the Colorado River basin.

Colorado is averaging 60% of normal with many subbasins averaging only 36-40% of normal. Arizona, New Mexico and Utah are worse. Some subbasins are as little as 2% of normal. Two percent is a daunting statistic. The NOAA long range forecast through May is for higher than normal temperatures and lower than normal precipitation across the Colorado River basin. In Colorado, there’s virtually nothing on the horizon in the next three weeks, which brings us into March. February and March are Colorado’s snowiest months, when Mother Nature is supposed to fill the natural reservoir known as the snowpack.

This foretells a high fire risk and troubling time for agriculture and municipal water suppliers. The two major regulating reservoirs on the Colorado tell the story.

LAKE POWELL:

Full elevation =                                 3,700’

Current elevation =                        3,532’

Projected 12/31/26 =                       3,513’

Power Pool elevation =                   3,490’   (elevation at which hydropower is diminished)

Dead Pool elevation =                     3,370’

LAKE MEAD:

Full elevation =                                 1,229’

Tier 1 Reductions=                          1,075’   (primarily affecting AZ and NV)

Current elevation =                        1,065’

Projected 12/31/26 =                       1,054’

Tier 2 Reductions=                          1,050’   (primarily affecting AZ)

Tier 2b Reductions=                        1,045  (primarily affecting AZ)

Power Pool elevation =                   1,035’   (elevation at which hydropower is diminished)

Dead Pool elevation =                       895’

Climate change is felt first in the water sphere. Its effects are dramatic: Increased demand due to longer growing and air-conditioning seasons, higher evaporation rates, drying of the subsoil and depletion of groundwater tables (think of a dry sponge, it takes water to fill the voids in that sponge before water flows away, in this case to the rivers). Projections are that climate change will decrease water content in the Colorado River by as much as 30% by 2050.

Hard questions are being asked. Can Arizona continue agricultural water use? Increasingly it doesn’t look like it. Central Arizona Project (CAP) reductions have cut agricultural water and cities have targeted ag water for their futures. Utah has reached its allocation under the Upper Basin Colorado River Compact and Colorado is not far behind.

Given the changing hydrograph and new demands placed on the system, it’s a fascinating time to be in the water field. Solutions exist. Some easy, some hard. Dramatic progress has been made in municipal water use reductions (the US uses about the same amount of water today for municipal use as it did in 1970, despite a 40% increase in population). But two large questions loom: Where and how will we supply water for food production? How will we supply electricity for our digital future?

Stay tuned and we’ll discuss these.

A CRISIS, NOT A HOAX: THE COLORADO RIVER

The administration labels climate change a hoax. Those outside the bubble of the East Coast, be they Democrats or Republicans, know better.  As Ben Franklin said: “When the well is dry, we learn the worth of water.” As a person who has only practiced western water law for over four decades, I have a blunter saying: Those that have plenty of water have no concept of the resource; you only understand water if you have none.

The seven basin states that rely on the Colorado River all know the value of water and the dramatic impact that climate change has had and continues to have on the basin. In the past thirty years, the Colorado River’s flow has declined by 20%. That is projected to decline to 30% by 2050. Ambient atmospheric temperatures in the Colorado River basin have increased by 2.3 degrees in that same period and are projected to be +4 degrees by 2050.  

Tainting science with politics is meaningless and further complicates the tasks of water managers. Just because you hide or deny a problem, the problem does not go away. Climate models all show the same results and trends. No model prepared by reputable scientists shows anything different. The models, to name just a few were generated by the US Bureau of Reclamation, the National Oceanic and Atmospheric Administration, Colorado State University, and National Research Council. They all reveal the same picture. We can’t deny ourselves out of the mess, we have to recognize and solve challenges, the best we can.

A brief summary of how we got here: In the 1880s, a young country sought to expand west and defend what it had. Los Angeles and San Diego were seen as strategic defensive necessities. The railroads and mining were drivers of western settlement. The Homestead Act of 1862 granted 160 acres to anyone willing to farm the land. The 1902 Reclamation Act provided cheap tax-payer subsidized irrigation water to farm while massive federal dams and canals were funded by the treasury to deliver that water.

The result was that the arid west was settled. What came next in this tight waterscape was conflict over limited water resources between the states. California and Arizona were growing at a pace faster than the upper basin states of Colorado, New Mexico, Utah, and Wyoming. The west’s water laws of the prior appropriation doctrine, mirror the miner’s credo of staking claims proclaims, “First in time, First in right.” Fearing that the lower basis states might usurp the future of other states, the seven states and the federal government convened negotiations to allocate the flow of the Colorado River.

While an article on this subject could fill libraries, suffice to say that the river was divided in half. Above Lee’s Ferry, Arizona (just below the dam at Lake Powell), the upper basin states were allocated 7.5 million acre feet on a ten year running average and the lower basin states of Arizona, California, and Nevada were allocated the other half. Off the top, 1.5 million acre feet was to go to Mexico by treaty. The engineering assumptions, based on a twenty year average, were that the native flow of the river was between 16.4 and 18 million acre feet.

Turns out that the period of study used fell within the one hundred years between 1890 and 1990 when paleoclimatic records show to be the wettest hundred year period since A.D.800 and that was the wettest in the previous 10,000 years. During the period after the compact was signed until the impacts of climate change began in the late 1980s, the river flowed around 15-16 million acre feet. With the advent of climate change, the flow now dips below 13 million acre feet/year. All models show that by 2050, this amount could be reduced by as much as an additional 10%.

The states have attempted to address this conflict. A deadline imposed by the federal government that largely manages the lower basin has come and gone. The legal conflict largely centers around gravity and language.

First, the language: To the four Upper Basin states and the three Lower Basin states, the compact allocated “the exclusive beneficial use of 7,500,000 acre-feet of water per annum…” (an additional 1.0 million acre-feet was available to the Lower Basin if surplus existed, so we can forget that). The burden of meeting the Mexico treaty obligation is shared between the Upper Basin and Lower Basin. The key factors are there is no expressed delivery obligation at Lee’s Ferry and evaporation is not mentioned. Lake Powell, located in the Upper Basin, is estimated to evaporate 300,000-500,000 acre-feet per year. Lake Mead, located in the Lower Basin, is estimated to evaporate as much as 1.9 million acre-feet annually. Additional evaporation occurs from the headwaters to Mexico.

Then comes gravity: The old saying is “I’d rather be upstream with a shovel, than downstream with a right.” The Upper Basin states say, “Hey, we haven’t used our 7.5 maf. The Lower Basin is evaporation and using more than 7.5 maf.” The Lower Basin states assert everyone should share in evaporation and the natural deficit.

The feds say they will “impose” a solution. That has doubtful legal authority. The compact is both a contract between the parties and an Act of Congress. The US Constitution, Art. 1, Sec. 10, provides that states may contract between themselves only with the consent of Congress, so when the contract between the states was signed, Congress’ approval made the contract also an Act of Congress. As we all know, to amend a contract, every contract party must agree. Therein lies the fallacy of the administration’s threat to “impose” a solution.

Some in the Lower Basin have threatened litigation based on the legal concept known as force majeure. Force majeure is a legal concept that excuses contract performance due to an event that cannot be foreseen or controlled (such as acts of God) that prevent performance. The argument is that climate change and the low flow of the river could not be foreseen in 1922 and cannot be controlled. That argument solves part of the definition but arguably not the second half: “that prevent performance.”

Nonetheless, sharing the hardship of climate change on some basis is reasonable and undoubtedly will be a part of any solution. But before we end, some perspective is in order: The Imperial Irrigation District, located in California’s Coachella Valley desert, has an allotment of 3.1 million acre-feet, more than Arizona, Utah, Nevada, and Wyoming…nearly as much as Colorado alone. The District’s 500,000 acres farms lettuces and vegetables supply the nation’s kitchens.

In the late 1880s and early 1900s the Federal government encouraged western expansion with cheap water to farm the great American desert. Like my earlier articles asking the question of whether datacenters should be located in water short areas, it may be time for a similar discussion of agribusiness as well.

In the meantime, the problem of climate change’s impact on the Colorado River is certainly not a hoax. The River supplies over 40 million people and over 2.5 million acres of agriculture. Denver, Phoenix, Tucson, Las Vegas, Los Angeles, San Diego, and places in between are reliant.  We cannot ignore that reality or science needed to solve the challenges.

JUST SAY NO

I’ve written before on the water and electric consumption of datacenters and the wisdom of developing them in arid locales. Today, I want to discuss the difference between wholly wasteful and preventable water and electric use and “necessary” water use.

First, the why? Datacenters are inevitable in our digital economy. Efficient datacenters located in areas with abundant water supplies are necessary development to be endorsed. Datacenters developed without regard to the waterscape, make little sense. I’ll give you an example.

Amarillo receives 19-20 inches of precipitation per year on average, an arid geographic region characterized by sage brush, arid grasses, and cactus. Fermi America proposes to construct 18 million square feet of datacenters powered by four small nuclear reactors and one gas generation facility. One of the principals is Rick Perry, former Governor of Texas. The name given to this, Project Matador, is not the name on the Federal Nuclear Energy Commission application (the NEC approves and regulates all  nuclear power plants). The applicant listed is The Donald J. Trump Advanced Energy & Intelligence Campus. Now that’s a name that should get a quick approval. Never mind that nuclear plants typically use 20-50 gallons of water to generate ONE kilowatt hour (1 kWh) and this project advertises it will generate 11 Gigawatts (11.0 million kWh) in the arid locale of the Texas panhandle. Do the math.

While no one questions the need for datacenters (after all, it took electrical energy and computing power to generate this article), datacenters are not just necessary to supply the nation’s computing and AI future. Those are what I would label “necessary uses” that drive datacenter development. The unnecessary and wasteful use that is also driving datacenter development is cryptocurrencies.

There are many cryptocurrencies out there but perhaps Bitcoin is the best known. Bitcoin alone required a reported 175 Terawatts/year of electric energy last year. That’s 175 billion kilowatts. While renewable energy generation requires virtually no water consumption, coal, nuclear, and gas generation requires serious quantities of water to generate the stream necessary to spin turbines to generate electricity.  Given that cryptocurrencies have no social, economic, cultural, or employment value, the need is wasteful. Cryptocurrencies are merely financial tools. They do not create jobs. Investing in the stock market means you are investing in companies that generate some service or product that benefits society or at least the employees that work for those companies. That can’t be said for cryptocurrencies. They’re a waste one can do without.

But they are a great investment tool you say. If you really believe that, you haven’t been looking at your investment lately. Just like recycling, we can all do our little part in the future. So, when it comes to deciding whether to add cryptocurrencies to your portfolio, I harken back to the wisdom of former First Lady Betty Ford, Just Say No.

WHY INFLATION IS RAMPANT IN THE ELECTRIC UTILITY SECTOR

Electric rates have surged far higher than the Consumer Price Index. Across the country, rates have escalated in 2025 from 5% to as high as 14%. The reasons boil down to policies. Sure, natural gas prices have risen, as have the costs of replacement infrastructure, but the real driver in utility raises have been poor governance.

Across the country, rates for electricity are set by agencies and commissions that regulate “public utilities.” They go by a myriad of titles, depending on which state you are in. Arizona’s agency is the Arizona Corporation Commission, Colorado’s is called the Colorado Public Utilities Commission, then there’s the Virginia State Corporation Commission, and the Illinois Commerce Commission. In roughly a third of the states, seats on these boards are elected while the balance are appointments by either the Governor or Legislature of the state. Most have one thing in common; they are subject to lobbying.

Three factors primarily drive rates: 1) Increase in electrical demand; 2) aging infrastructure (grid); and 3) costs of electrical generation. Seems pretty straightforward, doesn’t it? That’s what some would like to have you believe.

Let’s take a closer look at these three drivers.

·       Increase in Electrical Demand: With the nation’s population nearly flatlining, what is driving the need for more electricity? Sure, migration to certain areas increases population and demand, but that’s not it. Demand is being driven by smart appliances and the digital world we live in. Chief among these is AI and datacenters. One mega datacenter can use the power that a city of 750,000 uses. And, don’t get me talking about freshwater water usage for cooling and electrical generation. Take for example Arizona, a State in water crisis is the ranked 5th in the country for the number of datacenters. The Arizona Corporation Commission is weighing a rate increase of 14% this year for Arizona Public Service (APS), its third rate increase in four years. Rather assign the new infrastructure costs to the entities and new users that demand new infrastructure (like datacenters), costs are typically spread out amongst all users. It’s about policies that assign costs to those triggering new costs, common sense approaches lobbyists resist.

·       Aging Infrastructure: The grid is old and in need of hardening and upgrades. It has been neglected for decades. The costs of new infrastructure (equipment, poles, wire) have all escalated because of inflation and tariffs. But again, the demand for replacements, upgrades and expansions are being driven at a far faster pace by the new demands.

·       Costs of Electrical Generation: With the exception of renewables (hydro, wind, and solar), generation of electricity involves heating water to steam that drives turbines. Coal, natural gas, nuclear, they all use the same steam generation process. In 2025, the administration has embarked on a war against renewables (the Department of Energy is clawing back $1.8 billion in loan money from the APS designed to fund renewable generation, transmission and battery storage).

Arizona, like a great many purple and red states are mandating natural gas generating stations, despite coal and natural as being more costly to operate (not to mention water consumption again). Arizona is not alone.

Policies are choices. The common legislative authorization preamble for these state rate setting entities is to regulate industries for the public good. That goal seems to be getting lost far too often.