In 2004, a co-operative of farmers from the parched prairie of southeast Alberta approached the United Irrigation District (UID), wanting to purchase its water. The Waterton-area UID, one of Alberta’s 13 irrigation districts (non-profit organizations of rural residents that supply farms with water), was only using 75 per cent of its allotted water and had some to spare. In May of that year, it cut a deal to sell 1.6 million cubic metres of water to the co-operative for $780,000. “We felt that if they got their water out of the river, it wouldn’t affect us too bad,” says UID manager Kirt Woolf. “The process went really well.”
The irrigation district was the first organization to sell off water in Alberta, and since then, the market has exploded. With wells drying up and communities rapidly running out of water in the province’s semi-arid south, towns and developers have been eager to buy water from anyone who has extra. At least 11.4 million cubic metres of water and millions of dollars have changed hands. However, this system of selling water to the highest bidder is raising serious concerns. Critics say that parched communities are being left to the whims of the market, a new report argues that the system doesn’t protect river ecosystems and two irrigation districts have been tied up by legal proceedings over their plans to start selling water.
Alberta’s water rights system has always operated on a first-come, first-served basis. Many irrigation districts, which received water licences in the early 20th century, were given the right to more of the resource than towns that sprang up later, when water was less plentiful.
In 2006, with water running dangerously low in southern Alberta, the government stopped issuing licences for water withdrawals from the area’s rivers, including the Bow, the South Saskatchewan and the Oldman. This opened up the market for water: anyone who needed water would have to buy it from a licence-holder, with no limits on what the seller could charge. Alberta is the only jurisdiction in Canada to allow an open market for water.
By January 2008, there were 27 recorded sales to buyers including a golf course, a stockyard and the Millarville racetrack. The largest of the transfers, a $15-million deal to pipe over 2.2 million cubic metres of Bow River water from the Western Irrigation District to a megamall near Balzac, ignited a political firestorm when some farmers in the area objected to their water being sold for use by a recreation complex.
Critics of the system argue that, because the price of water is set by the open market, the resource goes to whoever can pay for it and not necessarily to the people who need it, and that it threatens ecosystems by pulling extra water out of rivers with virtually no restrictions.
“There need to be some ecological protections,” says Meghan Beveridge, a policy associate with Bow Riverkeeper, an Alberta-based conservation group. “When we transfer water, it becomes more heavily used.”
The government, however, says that it has been trying to ensure water conservation occurs, mainly through Watershed Planning Advisory Councils, groups of representatives from industry, the province and municipal governments that set targets for conservation. “They have a lot of clout,” says Cara Van Marck, a spokesperson for Alberta Environment, of the councils. “We decided we had to do something about (water shortages), and we did.”
The province also has the right to order 10 per cent of the water involved in a transfer to be held back for the river, but the government has only exercised this power on five occasions, according to data from Alberta Environment.
Fight to the Last Drop, a report issued last month by Bow Riverkeeper and Ecojustice, a national think-tank on environmental law and policy, is particularly concerned with the fact that water users can change their licences in order to get permission to supply water for recreational or municipal use without having to get approval from the government for a transfer. “They can change their licence to divvy (water) out to whoever they want,” Beveridge says. “They are the ones who decide where the water goes.”
At least four districts have changed their licences so they can sell water for industrial, recreational and commercial purposes. The largest one, the Lethbridge Northern Irrigation District, has the right to sell nearly 48.2 million cubic metres of water. Priced at the same rate as the Balzac deal, this would represent over $325 million worth of water. Ron Renwick, general manager of the Lethbridge-based St. Mary’s Irrigation District, which changed its licence in 2003, says the group has opted not to participate in the transfer system, but to set aside some water for sale for a small fee. “We just wanted to keep control of it,” he says. “We have a small amount of water available for other uses (than irrigation).”
Last fall, the Eastern Irrigation District (EID), which holds a licence to divert almost one-third of the Bow River’s water, asked for a licence change that would have allowed it to sell 24 million cubic metres of its water. After water experts complained that allowing this would divert too much of the resource from the river, the government put the application on hold while it reviewed its policy for altering licences.
Nigel Bankes, a University of Calgary expert in natural resources law, argues the market is necessary to ensure that water gets transferred from those who have extra to those who don’t have enough, but says there must be regulations to ensure there is enough water left in rivers to keep the ecosystem healthy. “We should be much more proactive,” he says. “I’m no fan of an unregulated market.”
The EID’s application is still in limbo, while the transfer to Balzac has gone through. And as for the UID, which kickstarted the system, it has no plans to sell more water anytime soon. With plans underway to set up more irrigation in the district, Woolf says the farmers will keep their extra 25 per cent as a cushion, in case they need it.
“We’ve turned all other requests (for water) down… until we’re sure where we sit with our water,” he says. “Every fall, we’re running short.”
