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Agriculture water trading, is it possible in Florida?

By Jim Fletcher

As this state continues to grow, water supply issues for both agriculture and public use are coming under increasing pressure. Traditional groundwater sources will not be sufficient to meet the future water demands without unacceptable impacts to the natural system. Public supply and agricultural irrigation account for 82% of groundwater withdrawals (USGS, 2014). To protect the resource, agriculture producers are looking to increase the efficiencies of their irrigations systems and better manage their irrigation scheduling.  These producers are looking at retrofits or upgrades to their current systems.  These upgrades are very expensive. However, these upgraded ag irrigation systems result in water conservation that is significantly less expensive than other conservation methods. These upgraded systems are showing 30-40 % water use efficiency savings and present an area that needs further exploration.

Currently the water management districts and Florida Department of Agriculture and Consumer Services (FDACS) offer cost share programs that can pay upwards of 75% of the cost of an upgrade to a system.  The other 25% must be covered by the producer. This 25% can cost more than $1000 per acre making it challenging for the producer to implement the upgrade given profitability of the enterprise.  What if a producer would be willing to give up part of his consumptive use permit (CUP) to get assistance with the uncovered cost of the efficiency upgrade? A utility or other interested party may be interested in paying the uncovered portion of the upgrade in return for getting more water allocated to their CUP or returned to the system to protect the natural resource.  Other parts of the country allow for this “trading”.  However, Florida law is very clear that the water belongs to the people of the state and cannot be traded as a commodity.

There is a group of interested stakeholders that include UF IFAS specialists and Extension agents, agriculture, utilities, water management districts, FDACS, and Florida Department of Environmental Protection that have formed a working group to look at the possibility of “trading credits” for water. UF IFAS Extension is providing leadership for this effort. The group has met and is in process of developing goals. These goals include water supply planning, ensuring ag producers have access to good quality water, identifying approaches to agriculture water trading(AWT) that are beneficial to both growers and public supply providers, and identifying barriers to AWT to include policy and law. The group has identified guiding principles to include ample water for agriculture in the future, voluntary program, mutually beneficially to all parties, and a clear understanding and methodology to measure savings for both quality and quantity. If you want more info or are interested in updates contact me, Jim Fletcher, at jhfr@ufl.edu or David Dinkins at dinkins@ufl.edu.