The Price of Water in the Desert: Public Interests and Private Ventures
July 23, 2017
The proposed Cadiz Water Project is an example of how business interests, environmental policy, and political power are fundamentally intertwined in a way that underlies many decisions made in Washington. Sometimes called the “Cadiz Valley Groundwater Storage Project,” or alternatively, the “Cadiz Water Conveyance Project,” this private water infrastructure project has become increasingly controversial in recent months as the Bureau of Land Management under President Trump has come closer to giving the project the green light.
Cadiz Inc. is a private company that has proposed leading the charge in pumping groundwater from under the Mojave Desert to Southern California, which currently gets a majority of its water from the Colorado River Aqueduct. The general goals of the project are to store water from the Colorado River in the Mojave basin and then provide this water to the Southern California region in times of drought or when it is needed; Cadiz claims that the main function of the project is water storage and that native groundwater to the Mojave Basin will not be pumped to large extent. The company claims that it can supply 100,000 homes a year  with water without disrupting the natural aquifer. Cadiz plans to make a profit by selling the stored water to urban areas in Southern California over the course of the project’s 50-year lifespan.
The project is controversial when it comes to the environmental impact that it may have  on the Mojave Desert region. Scientists and environmental consultants are concerned about the overpumping of groundwater in a desert region that is already extremely vulnerable to the effects of climate change and drought in California. In many parts of the state, overpumping of groundwater in times when surface water is scarce leads the land subsidence, which is the shrinking of the water table as the groundwater is removed; the storage capacity lost due to land subsidence cannot fully be regained when aquifers are recharged, and thus permanent storage capacity is lower for future years. Not only could the desert aquifer fail to recharge, having negative economic and environmental consequences for the state, but the delicate ecosystem of a natural landmark could be severely disturbed, as aggressive pumping is likely to dry up springs  that are necessary to sustain the wildlife habitat.
The plan was halted by the Bureau of Land Management under the Obama Administration. Cadiz Inc. had planned to use an existing right-of-way permit  that had been authorized by BLM for a railroad that crossed the same area as their proposed pipeline; using this right-of-way would have allowed the company to bypass an additional environmental review of the pipeline, which did not escape the attention of the BLM California office. The environmental review would have been a long process that would have cost Cadiz quite a bit of money and was something that they were eager to avoid.
However, in March of this year, the BLM under the new administration has pulled back on this initial 2015 decision, and the Trump administration seems sympathetic to Cadiz Inc.’s goals with the project.
This issue becomes even more complicated by the nominee for Deputy Secretary of the Department of the Interior, David Bernhardt. Questions have been raised by former Obama Administration officials as well as sitting members of Congress about possible conflicts of interest  in his appointment to the number two position in the DOI. Although Bernhardt does have experience working at DOI as chief legal counsel under George W. Bush, his work with energy and natural resource companies has been primarily on the side of coal and oil companies. He has represented a number of major companies that have a vested interest in the success of coal and fossil fuels and fewer regulations in these areas. Additionally, he has worked with Cadiz Inc.  specifically, which presents a conflict of interest in his appointment and ability to make a decision on the Cadiz water project.
The most recent drought in California has highlighted a number economic and policy issues that can drastically impact the future of the state. While Californians can breathe a brief sigh of relief after a season of substantial rainfall, it is only a matter of time before another drought brings the same issues to a boiling point again. It is time for the state to invest in substantial and robust water storage, recycling, and desalination infrastructure to be better prepared for dry periods, and in order to balance the needs of the many stakeholders without creating these political and economic tensions. Importantly, it must be noted that groundwater, in particular, is not a renewable resource, and shrinking our aquifers from over-pumping will simply lead to less water and greater problems in the future.
The nomination of Richard Bernhardt to Deputy Secretary of the DOI is certainly a much lower profile nomination coming from the White House, but one that could nonetheless play a huge role in the environmental management of environmentally vulnerable states, like California. While the Cadiz Water Project is a low profile issue even in the environmental community, the decision to give the project the green-light could cause environmental and economic hardships for Californians for years to come. In this issue, in particular, there certainly exist conflicts between political, economic, and environmental interests, and policymakers should be equipped to make decisions based on what will provide the greatest benefit for the general population as a whole.
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The views expressed on the Student Blog are the author’s opinions and don’t necessarily represent the Wharton Public Policy Initiative’s strategies, recommendations, or opinions.
Additional Blog Posts
 Boxall, Bettina. “Trump eases the way for a controversial water pumping project in a California desert.” The LA Times. April 5, 2017. http://www.latimes.com/local/lanow/la-me-trump-cadiz-20170404-story.html.
 “The Cadiz Valley Groundwater Storage Project.” Pacific Institute. http://pacinst.org/publication/cadiz-valley-groundwater/.
 Boxall, Bettina. “Trump eases the way for a controversial water pumping project in a California desert.” The LA Times. April 5, 2017. http://www.latimes.com/local/lanow/la-me-trump-cadiz-20170404-story.html .
 Boxall, Bettina. “BLM decision sets back Cadiz plan to sell Mojave groundwater.” The LA Times. October 5, 2015. http://www.latimes.com/science/la-me-cadiz-desert-water-20151006-story.html.
 Butler, Mark. “Trump’s deputy interior pick is a threat to the environment.” The Hill. May 19, 2017. http://thehill.com/blogs/pundits-blog/energy-environment/334130-trumps-deputy-interior-pick-is-a-threat-to-the.
 Natter, Ari. “Lobbying by Trump Interior Department Nominee Raises Concerns.” Bloomberg. May 18, 2017. https://bol.bna.com/lobbying-by-trump-interior-department-nominee-raises-concerns/.