Identify the critical sectors in each state that are drought vulnerable
In each state, we try to identify those sectors that are major water users, and also
important to the state economy. There should be evidence indicating critical impacts of
drought on those sectors.
Nebraska
Agriculture
Agriculture is the largest freshwater user in Nebraska. Irrigated land totals up to
7,625,170 acres (2002 census), ranking #2 in the western states (next to California).
According to a USGS 2000 water use report, irrigation alone accounts for 72% of total
freshwater consumption in Nebraska, with 84% from groundwater and another 16% from
surface water sources (Figure 1). Nebraska also has a large amount of dryland crop
production (14,895,704 acres) as well as pastureland and rangeland (21,940,679 acres),
which heavily rely on water from precipitation.
Agriculture is important for the state economy of Nebraska. According BEA 2004
data, agricultural production accounts for 6.4% of Gross State Product; and 1.1% of total
employment is in the agricultural sector (Figure 2). Agriculture is important to ensuring a
safe and consistent food supply at low prices. Agriculture also has multiplier effect on the
state economy through its links to the upstream and down stream industries, including
seed firms, fertilizer firms, producers of farm equipment, transportation companies, etc.,
which makes the total impact of agriculture even greater in the state economy.
Water, as the most critical input in agriculture production, is often the limiting
factor in the semi-arid High Plains. A drought in the growing season causes damage to
crops and pasturelands, resulting in a loss of production, additional feed costs, and
reduced farm incomes. The 2002 drought alone caused a total crop indemnity payment of
$290 million (USDA/RMA) within the state. Since the impacts of drought on crop
production and on livestock are very different, there is a clear need to separate these
effects in our study.
Crop production
Drought has different impacts on dryland production and irrigated crop
production. Dryland production relies on precipitation. Reduced precipitation during the
growing season would cause low yield, poor quality, and increase abandoned acres.
Drought impacts on irrigated crop production are different depending on the
irrigation water sources. In Nebraska, most of the irrigation water is from the
groundwater aquifer, which is less affected by drought. However, reduced precipitation
increases the net irrigation requirement, thus resulting in higher pumping costs.
The surface water availability depends on inflows and reservoir levels, which is
more sensitive to drought. For example, the current multiple-year drought and low
inflows have resulted in a historical low level of water stored in Lake McConaughy,
Nebraska’s largest reservoir, during 2004-2006 (Figure 3). It was reported that for the
first time, the Central Nebraska Public Power and Irrigation District (CNPPID) irrigators
received less than a full supply of water in the 65-year history of irrigation from Lake
McConaughy. Other major surface water irrigation districts affected by drought are
located within the North Platte River Basin and Republican River Basin. The major
source of irrigation water in the North Platte Basin is snow in Wyoming and Colorado.
While, the other surface water projects are largely dependent on relatively local run-off
from rainfall, or on base flow from groundwater. Therefore, drought impacts on irrigation
water availability differ by the location and timing of drought.
Livestock
Livestock products account for about 2/3 of Nebraska’s farm income and beef
cattle are the most important source. Nebraska ranks #2 among the states in total cattle
inventory. Drought stressed pastures and rangelands cause poor grass growth. Producers
have to pay high prices for supplement feed. A hay shortage in the local market would
boost up hay prices. Poor pasture conditions and high feed costs force early marketing
and culling, which would damp the market and result in low prices received by farmers.
Because of the biological reproduction features of livestock industry, the impacts of
drought would last for several years. Extra liquidation would hinder the rebuilding of cow
herds and interrupt the normal cattle inventory cycle. For example, U.S. national cattle
inventory data from USDA/NASS showed that the 2002 drought extended the otherwise
10-year cattle cycle to 14 years (1990-2004).
Energy
Hydropower electricity
In Nebraska, the net electricity generation from hydropower averaged around 1.3
million Megawatt hours, accounting for only 0.2% of total hydroelectricity generation in
U.S. The hydroelectricity generation data from 1990 through 2005 are plotted in Figure 4.
Since 2001, the net hydroelectricity generation has been much reduced, and it might be
due to drought.
Thermoelectricity
In Nebraska, thermoelectric plants use more surface water than irrigation (65% of
total surface water). The water provides cooling for the plants. So, when the supply of
water is limited, cooling costs go up and water reallocation has occurred as needed to
meet electrical demand. Another concern with drought is the river’s temperature. Users of
water must return it at about the same temperature it left the river, so it does not disrupt
the ecology of the water plants and animals. So, when the river is already warm in
drought, the power plants may have to cut back their generation.
Recreation and tourism
As there is no ski or rafting sites in Nebraska, the most water related recreation
activities are fishing and boating; and the drought impacts are limited. Figure 5 plots
Nebraska State park visits and revenue data from 1980 to 2003 (source: USDOC, Bureau
of the Census).1 We can hardly detect the impacts of drought.
1
Ray suggests using Nebraska Game and Parks data directly, rather than USDOC data to look at localized
drought impacts by major recreation facility. A severe localized drought impact may be important even
though statewide effects may be offset by growth elsewhere.
Most recreation users and visitors are in-state residents, who spend relatively little
money on lodging and restaurants. So, the indirect impacts on the local economy are also
small.
Conclusion
Based on above analysis, drought impacts are centered on the agriculture sector in
Nebraska. There seems to be some impacts in the energy sector, but more information is
needed before identification. Drought impacts on the recreation and tourism sector seems
to be minor in Nebraska at state level.
Other potential drought impacts that have been suggested include: environment,
municipal water supply, health, and water quality. The potential impacts of drought in
Nebraska on each are described in a little more detail below:
1) Environment: Difficult to measure impacts, but reduced flows could decrease habitat
for fish, increase river temperatures, etc.
2) Municipal water supply: While the impacts are not going to be too extreme (i.e., there
will always be drinking water, showers, etc.), there are municipalities that limit outdoor
watering. For example, just a couple of days ago one town in Nebraska decided to ban
lawn watering. There is certainly a loss in consumer surplus from such bans or limits.
3) Health: It’s unclear how drought would impact health.
4) Water quality: It’s unclear how drought would impact water quality significantly (at
least not in a way that has an economic impact). But, this is something to consider.
Some of these impacts might be big issues in Colorado or New Mexico, which
need further investigations.
Figure 1: Nebraska Freshwater Use
Freshwater use by category, Nebraska 2000
(water use are in thousand acre-feet per year)
Public Supply,
369.6, 3%
Domestic, 54.2, 0%
Thermoelectric,
3,158.8, 23%
Industrial, 42.7, 0%
Mining, 143.4, 1%
Livestock, 104.6,
1%
Irrigation, 9,846.1,
72%
Groundwater use by category, Nebraska 2000
(water use are in thousand acre-feet per year)
Livestock, 85.2,
1%
Mining, 6.3, 0%
Irrigation, 8,312.8,
95%
Thermoelectric,
7.7, 0%
Public Supply,
298.3, 3%
Domestic, 54.3,
1%
Industrial, 39.7, 0%
Surface-water use by category, Nebraska 2000
(water use are in thousand acre-feet per year)
Public Supply, 71.5,
1%
Domestic, 0.0, 0%
Industrial, 2.9, 0%
Irrigation, 1,537.4,
31%
Thermoelectric,
3,148.8, 65%
Livestock, 19.5, 0%
Mining, 136.7, 3%
Figure 2: Nebraska Gross State Product and Employment by Industry
Industry Com position_NE2004
Agriculture,
6.43%
Government,
14.84%
Minining&Constr
uction, 4.49%
Manufacturing,
10.62%
Services,
21.27%
Trans. & Util.,
9.38%
w holesale,
6.01%
FIRE1, 16.86%
Retail, 6.53%
Information,
3.58%
Nebraska Employment by Industry
Government,
17.21%
Agriculture,
1.12%
Minining&Constr.,
5.48%
Manufacturing,
11.41%
Trans. & Util.,
4.29%
Services, 34.52%
w holesale, 4.64%
Retail, 12.08%
FIRE, 6.81%
Information,
2.43%
Figure 3: Lake McConaughy Elevation
Figure 4: Hydroelectricity Generation in Nebraska
Hydroelectricity Generation in Nebraska
2000000
1600000
1400000
1200000
1000000
800000
600000
400000
200000
Year
2005
2004
2003
2002
2001
2000
1999
1998
1997
1996
1995
1994
1993
1992
1991
0
1990
Thousand Megawatthours
1800000
Figure 5: Nebraska State Parks Visits and Revenue
State Parks Visits and Revenue of Nebraska
12,000,000
10,000,000
6,000,000
4,000,000
2,000,000
Year
Visitors
Revenue
2002
2000
1998
1996
1994
1992
1990 1
1988
1986
1984
1982
0
1980
$
8,000,000