Results have been announced for an auction held recently in Bakersfield, Calif., for surplus water supplies held by a small water district. The average price per acre-foot was eye-opening, and could affect how some water is allocated in the future.
Early this year, the Buena Vista Water Storage District determined it had 12,206 extra acre-feet of water, so in February it held a sealed bid auction for the excess. The starting bid price was $600 per acre-foot – approximately triple the cost of State Water Project water.
Even so, the response was surprising: 50 offers that went as high as $1,350 per acre-foot and sought a combined total of 65,000 acre-feet.
Four winners have been announced, all local farming operations. The auction's total gross proceeds are $13,855,355 or $1,135 per acre-foot.
The water district plans to use part of the money to offer a $400 per acre incentive to its customers to not plant land, thus reducing overall demand on its water supplies. The goal was to fallow 4,000 to 5,000 acres, but like the water auction, interest in the program turned out to be far greater.
The water district wound up getting applications for 11,000 acres, of which general manager Maurice Etchechury estimates 7,500 will be taken into the program at a cost of $3 million.
