Introduction The Green River drainage in Wyoming contains large deposits of oil shale, tar sands, crude oil, coal and natural gas that are used to produce refined petroleum products, natural and synthetic gas and electrical power. Agriculture is the predominant consumer of water in the area, accounting for over 90 percent of the total depletions. With new energy projects and the associated growth of population and affluence, the demand for water is expected to increase. Future anticipated energy development and production in the energy rich areas of the basin may compete with agriculture for the limited supply of water by bidding up the price of water.
Any increase in the price of water will give incentives in the agricultural and energy producing sectors of the economy to reduce present water use through adopting water conserving practices and by substituting other factors for water. The United States Water Resources Council (1978) stated in regards to water conservation that without intensified dedication to careful management of water resources, pressures from our technological society will continue to deplete and degrade the nation's water supply.
In economic terms, conservation is defined as the care and preservation of natural resources in such a way as to prolong and make for their most effective use (Sloan and Zurcher, 1970). Water conservation, as defined by the U.S. Water Resources Council, is to avert critical water shortages and to get the greatest use from existing supplies by increasing the average physical product of water through better management and technology. The adoption of water conservation measures may decrease the supply of water and/or change the timing of supplies to the downstream users due to reduced return flows and/or increases in upstream consumptive use. The return flow of water from upstream uses is part of the supply of water to a downstream user. Therefore, the welfare of the entire basin must be evaluated in determining benefits to water conservation measures. Water conservation practices, in response to increases in the price of water such as improvements to water conveyance and application systems, could reduce water diversions in irrigated agriculture. These practices are likely to increase irrigation efficiency, but at the same time reduce return flows. In the energy sector, the demand for water can be reduced by conservation measures such as, the use of waste or brackish water in energy development projects, alternative methods of mining and dry or hybrid cooling towers in power generation. Other water conservation practices (not available to the private sector) include reduction of water evaporation from reservoirs and the consumption of water by phreatophytes along canals and river banks. In the long run, substitution of capital for water can take place through alternative water-use technologies and conservation measures.
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