How to keep rivers and streams flowing

With streams and rivers drying up because of over-usage, Rob Harmon has implemented an ingenious market mechanism to bring back the water. Farmers and beer companies find their fates intertwined in the intriguing century-old tale of Prickly Pear Creek.

This is a river.

This is a stream.

This is a river.

This is happening all over the country.

There are tens of thousands of miles

of dewatered streams in the United States.

On this map,

the colored areas represent water conflicts.

Similar problems are emerging in the east as well.

The reasons vary state to state,

but mostly in the details.

There are 4,000 miles of dewatered streams

in Montana alone.

They would ordinarily support fish and other wildlife.

They're the veins of the ecosystem,

and they're often empty veins.

I want to tell you the story

of just one of these streams

because it's an archetype for the larger story.

This is Prickly Pear Creek.

It runs through a populated area

from East Helena to Lake Helena.

It supports wild fish

including cutthroat, brown

and rainbow trout.

Nearly every year

for more than a hundred years,

it's looked like this in the summer.

How did we get here?

Well, it started back in the late 1800s

when people started settling in places like Montana.

In short, there was a lot of water

and there weren't very many people.

But as more people showed up wanting water,

the folks who were there first got a little concerned,

and in 1865, Montana passed its first water law.

It basically said, everybody near the stream

can share in the stream.

Oddly, a lot of people showed up wanting to share the stream,

and the folks who were there first

got concerned enough to bring out their lawyers.

There were precedent-setting suits

in 1870 and 1872,

both involving Prickly Pear Creek.

And in 1921,

the Montana Supreme Court

ruled in a case involving Prickly Pear

that the folks who were there first

had the first, or "senior water rights."

These senior water rights are key.

The problem is that all over the west now

it looks like this.

Some of these creeks

have claims for 50 to 100 times more water

than is actually in the stream.

And the senior water rights holders,

if they don't use their water right,

they risk losing their water right,

along with the economic value that goes with it.

So they have no incentive to conserve.

So it's not just about the number of people;

the system itself creates a disincentive to conserve

because you can lose your water right if you don't use it.

So after decades of lawsuits

and 140 years, now, of experience,

we still have this.

It's a broken system.

There's a disincentive to conserve,

because, if you don't use your water right,

you can lose your water right.

And I'm sure you all know, this has created significant conflicts

between the agricultural and environmental communities.

Okay. Now I'm going to change gears here.

Most of you will be happy to know

that the rest of the presentation's free,

and some of you'll be happy to know that it involves beer.

(Laughter)

There's another thing happening around the country,

which is that companies are starting to get concerned

about their water footprint.

They're concerned about securing an adequate supply of water,

they're trying to be really efficient with their water use,

and they're concerned about how their water use

affects the image of their brand.

Well, it's a national problem,

but I'm going to tell you another story from Montana,

and it involves beer.

I bet you didn't know, it takes about 5 pints of water

to make a pint of beer.

If you include all the drain,

it takes more than a hundred pints of water to make a pint of beer.

Now the brewers in Montana

have already done a lot

to reduce their water consumption,

but they still use millions of gallons of water.

I mean, there's water in beer.

So what can they do

about this remaining water footprint

that can have serious effects

on the ecosystem?

These ecosystems are really important

to the Montana brewers and their customers.

After all, there's a strong correlation

between water and fishing,

and for some, there's a strong correlation

between fishing and beer.

(Laughter)

So the Montana brewers and their customers are concerned,

and they're looking for some way to address the problem.

So how can they address this remaining water footprint?

Remember Prickly Pear.

Up until now,

business water stewardship

has been limited to measuring and reducing,

and we're suggesting that the next step

is to restore.

Remember Prickly Pear.

It's a broken system.

You've got a disincentive to conserve,

because if you don't use your water right, you risk losing your water right.

Well, we decided to connect these two worlds --

the world of the companies

with their water footprints

and the world of the farmers

with their senior water rights on these creeks.

In some states,

senior water rights holders

can leave their water in-stream

while legally protecting it from others

and maintaining their water right.

After all,

it is their water right,

and if they want to use that water right

to help the fish grow in the stream,

it's their right to do so.

But they have no incentive to do so.

So, working with local water trusts,

we created an incentive to do so.

We pay them to leave their water in-stream.

That's what's happening here.

This individual has made the choice

and is closing this water diversion,

leaving the water in the stream.

He doesn't lose the water right,

he just chooses to apply that right,

or some portion of it,

to the stream, instead of to the land.

Because he's the senior water rights holder,

he can protect the water from other users in the stream.

Okay?

He gets paid to leave the water in the stream.

This guy's measuring the water

that this leaves in the stream.

We then take the measured water,

we divide it into thousand-gallon increments.

Each increment gets a serial number and a certificate,

and then the brewers and others

buy those certificates

as a way to return water

to these degraded ecosystems.

The brewers pay

to restore water to the stream.

It provides a simple, inexpensive

and measurable way

to return water to these degraded ecosystems,

while giving farmers an economic choice

and giving businesses concerned about their water footprints

an easy way to deal with them.

After 140 years of conflict

and 100 years of dry streams,

a circumstance that litigation and regulation

has not solved,

we put together a market-based,

willing buyer, willing seller solution --

a solution that does not require litigation.

It's about giving

folks concerned about their water footprints

a real opportunity

to put water where it's critically needed,

into these degraded ecosystems,

while at the same time

providing farmers

a meaningful economic choice

about how their water is used.

These transactions create allies, not enemies.

They connect people rather than dividing them.

And they provide needed economic support for rural communities.

And most importantly, it's working.

We've returned more than four billion gallons of water

to degraded ecosystems.

We've connected senior water rights holders

with brewers in Montana,

with hotels and tea companies in Oregon

and with high-tech companies that use a lot of water in the Southwest.

And when we make these connections,

we can and we do

turn this into this.

Thank you very much.

(Applause)