Ecological Incentives for Delta Water Exports

by Jay Lund and Peter Moyle

All parties in the Delta have an interest in a healthy ecosystem and in healthy water exports.  Without a healthy ecosystem, endangered species requirements increasingly intrude on water exports and Delta landowners.  Without healthy water exports, the south and central Delta becomes dominated by brackish agricultural drainage and state interest in funding local levees diminishes.  The Delta, in essence, is the hostage of all interests.

The hostage is not doing well, but it is easier for stakeholders to battle over management than to find common cause.  A better framework for compromise and cooperation is needed.

The many parties to Delta policy will never enthusiastically agree on Delta exports and outflows or how to adapt outflow and export quantities to future conditions.  Scientific complexity and uncertainty make it impossible to specify exactly what the ecosystem needs to be healthy.

Currently, minimum flow requirements are employed to support in-Delta water quality for exports and in-Delta users, and to support some threatened native fish species.  These standards have not been sufficient (or effective) to support native species and have exacerbated water quality problems for some areas and purposes.  Moreover, the fixed standards are not readily adaptable to changing conditions or experimentation.  Arguments over Delta standards have fostered much conflict, but little forward-looking insight or compromise.

Give the ecosystem shares of Delta water export capacity

We propose that water export capacity and flow authority be allocated to various export and ecosystem authorities, and then managed flexibly.  This would create incentives for all parties to cooperate in Central Valley Project (CVP) and State Water Project (SWP) operations and to invest in ecosystems and Delta levees, especially where landowner levee interests coincide with ecosystem and export objectives.  Management for ecosystem purposes would shift at least partially from legal regulation to operational governance and active stewardship. This approach would work under the existing configuration of the Delta and could be adapted if one or two tunnels are constructed to convey water from the lower Sacramento River to the south Delta pumps.

The ecosystem share of export capacity could remain unused at times when ecosystem objectives are most sensitive to water exports or be rented to raise funds for ecosystem improvements.  Fish require both flows and habitat, and resources are needed to acquire and assure both at the proper times and locations.  Ecosystem managers would become more directly aware of the trade-offs of exports and revenues for ecosystem support and the value of experimentation and flexibility.

This framework also provides incentives for water exporters to invest in both desirable water infrastructure and the future of reconciled ecosystems with desirable characteristics.  To the extent that native fishes prosper, more export capacity becomes reliably available.  The flexible allocation of export capacity across export and ecosystem purposes also establishes a framework for cooperation and pragmatic negotiation and sharing of risks.

Define flexible water export shares for the ecosystem and exporters

We propose six “pools” of Delta water with different authorities for water export.  These pools could vary with hydrologic conditions and are shown below for three different types of water years:

(1) Required Delta outflows. This water serves overlapping needs for water quality for export and in-Delta uses and endangered species (Gartrell et al 2017a, b).  It would be defined as a conventional minimum flow requirement.

(2) Water diverted upstream of the Delta. This pool consists of the water diverted for upstream agricultural, municipal, business, and wetlands uses upstream of the Delta. It accounts for most human water use in the system.  This pool might be limited based on hydrologic and ecosystem conditions.

(3) Reliable Delta Exports. This pool would be available for export uses under the exclusive control of the CVP and SWP.

(4) Performance-Based Exports. This pool would allow additional water export capacity if specified ecosystem function and fish condition targets are achieved.  If these targets are not met, this water would augment Delta outflows.

(5) Ecosystem-Discretion (Adaptive Management) Water. This pool would be additional export capacity available at the discretion of an ecosystem steward for lease to export or in-Delta users, augment Delta outflows, or support adaptive management experiments.

(6) Uncapturable flows. Wet years (such as 2011 or 2017) have significant uncapturable water in excess of these five categories (so-called “spill”).  Even dry years have some uncapturable inflows discharging to San Francisco Bay when export and storage capacities are insufficient (Gartrell et al. 2017a, b).

Proposed allocation framework for Delta export capacity (not at all to scale). The three Delta exports pools would be controlled by different interests.

The interested parties would negotiate the details of these pools, but ultimately both the export quantities and the other conditions would govern the use of existing or new water export facilities, subject to approval by the State Water Resources Control Board (SWRCB) in consultation with state and federal fisheries agencies.

Additional thoughts on the three export pools, including risk-sharing, incentive structures, and operational considerations

Reliable Delta Export Pool.  This limited Delta export capacity would be assured, but vary with hydrologic conditions.  It establishes a secure supply for exporters making major long-term investments, and would be available as long as required Delta outflows are met.

Performance-Based Export Pool.  This water export quantity would be determined annually by achievement of specific ecosystem function, fish condition, or fish population objectives.  This pool is essentially a flexible minimum Delta outflow requirement, with its availability for exports contingent on improving ecosystem conditions. Initially, perhaps 90 percent of the pool would be allocated based on achieving ecosystem function objectives (flow patterns, habitat functions, etc.).  Over time, this share should recede, with growing weight for meeting fish condition or population objectives.  The higher initial emphasis on ecosystem function objectives would provide incentives for exporters to invest in improving flow management, large-scale habitat restoration projects, and reducing the effects of other stressors, such as pesticides, particularly in the early years of the agreement when uncertainty is great and before fish populations could be expected to respond.  The performance measures could be negotiated as part of an agreement and periodically updated, perhaps with initial suggestions from an independent scientific group.  The SWRCB (perhaps in consultation with the Delta Watermaster) would determine if performance conditions have been met.

Ecosystem Discretion (Adaptive Management) Pool.  Export capacity from this pool would be allocated by an Ecosystem Steward – perhaps a special office in the California Department of Fish and Wildlife, in consultation with the U.S. Fish and Wildlife Service, the National Marine Fisheries Service, and an external independent science panel.  This capacity could be used to increase outflows or be leased at negotiated rates to willing export users and/or upstream water sellers.  Revenues from the leases would help support ecosystem management and improvements for the Delta ecosystem.

(Another way to administer this pool would be to provide guaranteed funding to the Environmental Steward to purchase export capacity and thereby increase net Delta outflows. Such funds would need to be built into the agreement, not subject to the unreliability of legislative appropriations or voter-approved water bonds.)

The Ecosystem Steward would face an annual decision on how best to protect the Delta ecosystem through a mix of Delta outflow and funding for other environmental projects.  This pool also would provide flexibility for adaptive management and would likely require some federal approval or acceptance.

Sharing Risks.  The future is an uncertain place.  Any agreement implies an allocation of both benefits and risks.  Naturally, all sides prefer to shift risks to others.  Scientific uncertainties regarding Delta fish population performance make it more difficult for wildlife agencies to commit to a long-term permit that omits population performance contingencies; otherwise, they bear the full risk of continued species decline. In the framework proposed here, the Performance-based and Ecosystem Discretion export pools allow some flexible risk-sharing and experimentation over time, while the required Delta outflow and reliable export amounts somewhat limit both environmental and economic risks.

Incentives.  Risk-sharing must be accompanied by positive incentives for all parties to make the system work for the ecosystem and the economy.  This proposal would give water exporters incentives to improve both ecosystem functions and fish populations, while also providing water export reliability needed to justify large capital investments that improve export water quality and ecosystem functions.  The framework also would give ecosystem managers incentives to enhance water export reliability as a way to help improve ecosystem conditions and fish populations.

Diversion location.  The Ecosystem Steward’s authority might include how to divide exports between the existing south Delta pumps and any new upstream intakes to maximize ecosystem benefits for any amount of Delta exports. For instance, upstream diversions through a tunnel might be favored during the spring, because spring export diversions from the south Delta pumps disrupt migration of estuarine fishes.

Annual and seasonal variability.  Hydrologic variability could be incorporated by varying the volume of each of the three pools based on a water year index, as illustrated in Figure 1.  A seasonal distribution of export capacity might be imposed generally or at particular intake locations to reflect seasonal fish migrations and other desired ecosystem functions, perhaps with substantive discretion for the Ecosystem Steward.

Special cases.  A re-opener clause would be desirable if the future changes radically (perhaps from an earthquake, levee failures, or new legal or regulatory conditions).  Extreme droughts also might trigger a re-opener clause.  Such aspects are discussed for Ecosystem Water Budgets by Mount et al. (2017).  Development of infrastructure or operations to capture currently uncapturable flows might trigger additional negotiation.

Evolving understanding.  Evaluation standards for the Performance-Based Pool should evolve over time based on improved scientific understanding of desirable ecosystem functions and the effects of water diversions, changes in flow and temperature, pollutant discharges, and other stressors on fish populations and water quality needs.  Such revisions might occur at regular intervals or in response to scientific advances. An independent science panel would initiate and oversee the revision process.  By providing flexibility to support adaptive management, Ecosystem Discretion exports would also provide information improving ecosystem, water quality, and water supply management.

Consistency with Endangered Species Acts and Other Environmental Laws

Mount et al. (2017) discuss the legal authorities and requirements for such more flexible ecosystem management.  Such proposals, though novel, can, in theory, be consistent with federal and state Endangered Species Acts.  Although the federal and state ESAs allow for the taking of a few individuals of protected species as an unavoidable consequence of project operations, they also require that such incidental takings be accompanied by measures to restore the species to sustainable populations and protect the species’ habitat.

Our framework acknowledges need for more than a fixed minimum ecological flow.  Environmental managers also need flexibility to adaptively manage flows and system improvements that reduce many stresses (e.g., better physical habitat, reduced pollution, and better hatchery management). The Ecosystem Decision Pool allows an Ecosystem Steward to adaptively adjust flows.  The Performance-Based Export Pool allows some additional exports if improvements in habitat, water quality, project operations, or other factors demonstrably benefit protected species or their habitats.

Sharing Risks and Incentives

In the declining Delta ecosystem, passive regulatory approaches have not been effective.  The approach presented here adds resources, flexibility, and incentives for continuous attention, which can accommodate adaptive management with changing and uncertain conditions.  It also can better integrate water operations with other habitat improvements in the Delta ecosystem.

We offer this framework and proposed allocation of Delta water export capacity in the spirit of creative problem-solving. Many variants of this idea might provide a workable approach for the WaterFix, environmental flow, and more general Delta negotiations.  The approach has similarities with Delta export management and Ecosystem Water Budget (EWB) strategies previously proposed (Lund et al. 2010; Mount et al. 2017).

This proposed framework suggests a middle path for managing Delta exports with shared risks and incentives: An environmental protective baseline is supplemented by performance-based restrictions on water exports.  Water exporters receive a baseline of reliable water export capacity and additional export capacity for approved ecosystem improvements and actual improvements in fish populations or conditions. (The baseline for future performance of fish populations might account for declining populations anticipated from climate change and other external factors, with credit for improving performance above a declining baseline.) And environmental managers receive defined capacity that they may use flexibly, either to directly augment environmental baseline flows, support adaptive management experiments, or raise funds for additional ecosystem enhancements.

Such a middle way would help to move all parties toward practical deals to meet the co-equal goals of improving ecosystem sustainability and water supply reliability in the Delta, within a framework that can adapt over time.  It also may help avoid mutually destructive battles and delays.

Jay Lund is a Professor of Civil and Environmental Engineering and Director of the Center for Watershed Sciences at UC Davis. Peter B. Moyle is a UC Davis Professor Emeritus of fish biology and an associate director of the Center for Watershed Sciences.

Further Reading

Delta Independent Science Board, Flows and Fishes in the Sacramento-San Joaquin Delta: Research Needs in Support of Adaptive Management, Delta Stewardship Council, Sacramento, CA, 37 pp., September 2015.

Greg Gartrell, Jeffrey Mount, Ellen Hanak, Brian Gray (2017a), A New Approach to Accounting for Environmental Water Insights from the Sacramento–San Joaquin Delta, PPIC, San Francisco, CA.

Greg Gartrell, Jeffrey Mount, Ellen Hanak, Alvar Escriva-Bou, Brian Gray (2017b), Appendix B: Water Assigned to Meeting Environmental Standards in the Delta from 1980–2016, PPIC, San Francisco, CA.

Greg Gartrell and Brian Gray (2017), Appendix A: A Brief Review of Regulatory Assignment of Water in the Sacramento–San Joaquin Delta, PPIC, San Francisco, CA.

Lund, J., E. Hanak, W. Fleenor, W. Bennett, R. Howitt, J. Mount, and P. Moyle, Comparing Futures for the Sacramento-San Joaquin Delta, University of California Press, Berkeley, CA, February 2010.

Mount, J., B. Gray, C. Chappelle, G. Gartrell, T. Grantham, P. Moyle, N. Seavy, L. Szeptycki, and B. Thompson (2017), Managing California’s Freshwater Ecosystems – Lessons from the 2012-16 Drought, Public Policy Institute of California, San Francisco, CA, November, 50 pp.

Wiens, J. , J. Zedler, V. Resh, T. Collier, S. Brandt, R. Norgaard, J. Lund, B. Atwater, E. Canuel, and H.J. Fernando, “Facilitating Adaptive Management in the Sacramento-San Joaquin Delta,” San Francisco Estuary and Watershed Science, Vol. 15, No. 2, July 2017.

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7 Responses to Ecological Incentives for Delta Water Exports

  1. Frances Griffin says:

    Habitat for fish??
    Fish live in water. That IS their habitat.
    Exports help the Delta?? Some explanation very much needed!

    Liked by 1 person

    • jaylund says:

      It is an awkward irony that without some south Delta exports, the southern Delta would be more stagnant and have lower water quality. Particularly in summer and fall, south Delta exports bring higher quality water from the Sacramento River into the south Delta to dilute and displace agricultural drainage from the Delta and the San Joaquin River.


      • criticalreader1 says:

        It is not actually the exports that freshen the south Delta, it is the opening of the Delta Cross Channels (DCC) in anticipation of exports that freshens the south Delta (along with Georgianna Slough and other natural waterways). It would be theoretically possible to freshen the south Delta through the DCC without exporting the water at the south Delta pumps. It’s just that the water managers would not typically run water through the DCC to the south Delta unless exports were planned.


  2. criticalreader1 says:

    This approach does not appear to recognize local water supply needs within and around the Delta. In addition to an adequate volume of water, these users rely on adequate water quality to carry out their municipal agricultural, industrial and other beneficial uses. The assumption that the Delta Tunnels could or would be built and operated in a manner that protected these local uses is incorrect. Removing large amounts of freshwater out of the northern Delta throughout the year (a big gulp, little sip operational scenario has not been proposed and could not likely be enforced anyway) would dramatically worsen water quality and water availability to existing beneficial uses in the Delta. Additionally, the proposed new diversions would reduce Sacramento River water levels, thereby reducing recharge of groundwater subbasins to the east that are already in overdraft. More thought would be required to make this concept at all workable.


  3. Joseph Rizzi says:

    Export water should be required to not KILL any fish!!!! Replace the 1.5 mile levee at Clifton Court Forebay (CCF) with a 1.5 mile fish screen or ZeeWeed ultra filters. Have the CVP hooked up to CCF and remove the 2 existing fish capture and relocation operations. This would save money in the long run, add more water for export and NEVER KILL any more fish from the Delta!

    WIN – WIN for water exports and Fish.

    Liked by 1 person

  4. Chris Gilbert says:

    When the SWRCB proposes 40% unimpaired flows how would that fit into these models? What categories would that fall into?


  5. Pingback: Advice on Voluntary Settlements for California’s Bay-Delta Water Quality Control Plan Part 2: Recommended Actions to Improve Ecological Function in the Delta | California WaterBlog

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