Fox Canyon: Case Study
California's First Groundwater Market
The Fox Canyon Groundwater Management Agency (FCGMA), in western Ventura County, was the first GSA to pursue a groundwater market as a tool to decrease water demand when implementing its GSP. Facing expected cuts of up to 35 percent of groundwater use in two critically overdrafted subbasins, growers in the Oxnard basin were motivated to call for a groundwater market as a tool to provide additional flexibility and ease the implementation of fixed water allocations. Starting in 2016, FCGMA worked with growers, environmental groups including The Nature Conservancy, and other local stakeholders to design, test, and implement a groundwater market. Our work on the project revealed three essentials for a water market’s success: accurate water usage data, group consensus, and an ability for farmers to make easy and transparent transactions. The market development process allowed for different groundwater user groups to identify shared benefits and goals of market implementation.
Finding Common Ground
Communities, farmers and conservationists can find common ground when it comes to using less groundwater.
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Markets make complying with regulation easier
A market helps water users comply with cuts to groundwater use that are part of achieving sustainability. The market allows for quick and easy transactions.
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Financial incentives when you conserve
The Fox Canyon groundwater market not only enforced each farmer’s specific pumping limit, it rewarded them for staying below their limit by allowing them to sell water to other growers.
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Markets get people the water they need
It’s a two-sided market. People who don’t have enough aren’t forced to cut water usage, since the groundwater market allows them to buy the water they need from their neighbors.
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Markets allow flexibility in times of scarcity
A water market gives farmers the flexibility they need to remain in business, despite reductions in water allocations and the unpredictability of California’s water supply.
Fox Canyon’s groundwater market operated for several years after its launch but experienced some challenges with the market structure; due to a reduced capacity at the GSA, meaningful adjustments have not yet been made to ensure market effectiveness. TNC is working with local stakeholders in Ventura and beyond to ensure groundwater markets are designed and implemented effectively and for the long term.
Learn more about the Fox Canyon Groundwater Market: