California, drought, death valley, badwater, private water sales, economy

Badwater in California's Death Valley is always this brutal, but as residents feel the burn of the state's third dry summer, wallets empty for any extra water.     Photo: Fikret Onal/Flickr

The Next Gold Rush? Water

Prices in California skyrocket

California continues to suffer through its third summer of drought, but the state's water market runs free—and people are willing to pay a pretty penny for the stuff. To put it in textbook-visualization terms, the price has climbed as high as $2,200 for an amount of water that would cover a football field in a foot-deep layer.

Anyone with water to spare is taking advantage of that. That mostly includes water districts and farmers, who are making millions of dollars from private water sales, predominantly to other farms. As California cities fine residents for excess water use or pay them for planting drought-resistant vegetation, the state has allowed the market to set the price for water.

Hence the four-digit price tag. According to the Associated Press, economists are saying that "it's been decades since the water market has been this hot." In fact, at a California Environmental Protection Agency meeting on Tuesday, staff members projected that this month's water demand in Sacramento and the San Joaquin River watershed would be five times greater than what's available. In some rural areas, the AP says, water auctions have become a spectacle; one water district got about 50 bids for extra water.

As other drought-prone states like Texas and Colorado follow suit, some water economists say they would like to see more regulations on these sales. The state maintains that buyers and sellers are capable of negotiating amongst themselves. "Now everyone's mad at me, saying I increased the price of water," Maurice Etchechury, manager of the Buena Vista Water Storage District, said at his district's publicly broadcast water auction in February. "I didn't do it, the weather did it."