This article explores new research from the University of California, Davis, showing how droughts sharply drive up the price of California’s surface water while leaving groundwater prices comparatively steady.
It explains why this price gap matters for farmers, cities, and ecosystems, and how smarter coordination of water resources and climate action can help stabilize costs and strengthen resilience in a warming world.
How Droughts Drive Up the Cost of California’s Surface Water
California’s climate is naturally variable, but climate change is amplifying that variability.
The new study, published in Nature Sustainability, quantifies just how expensive drought has become for surface water users across the state.
Surface Water Prices Triple in Dry Years
Researchers found that during drought conditions, the price of surface water sourced from rivers, lakes, and reservoirs can soar to $487 per acre-foot.
An acre-foot is roughly the amount of water needed to cover one acre of land to a depth of one foot, enough to supply several households for a year.
In average or wet years, surface water is substantially cheaper.
The drought-driven spike means prices can more than triple, squeezing budgets for:
Groundwater Prices Stay Relatively Stable
In contrast to surface water, the study shows that groundwater prices remain comparatively stable even during severe drought.
Groundwater acts as a buffer, providing a more reliable supply when rivers and reservoirs run low.
This stability, however, comes with a caveat.
Historically, many groundwater basins have not been managed to store excess surface water during wet years, limiting their potential to cushion both physical shortages and market price shocks.
Why Coordinating Surface and Groundwater Use Matters
Study author Madeline Turland emphasizes that better integration of surface water and groundwater management could reduce both costs and vulnerability in a changing climate.
Using Aquifers as Strategic Water Banks
In many parts of California, groundwater basins could effectively function as underground reservoirs.
In wet years, surplus surface water can be deliberately recharged into aquifers, where it is protected from evaporation and stored for future droughts.
According to the study, failing to store this excess water leaves regions exposed to sudden price spikes when dry conditions return.
Coordinated management could:
Building Resilience as Climate Extremes Intensify
As droughts become more frequent and intense with climate change, the economic consequences of unmanaged variability will grow.
Governments, water utilities, and local agencies will need to invest in infrastructure, monitoring, and governance frameworks that support aquifer recharge, sustainable pumping, and equitable allocation under scarcity.
Climate Change: The Larger Driver Behind Drought and Risk
The price dynamics observed in the study are symptoms of a deeper problem: a warming climate driving more extreme and prolonged droughts, especially in regions like California.
Warming Temperatures and More Extreme Droughts
Rising global temperatures, primarily caused by fossil fuel emissions, have made the last decade the warmest on record.
Warmer air pulls more moisture from soils and vegetation, intensifying drought conditions even when precipitation doesn’t dramatically change.
These dry conditions have cascading impacts:
Water, Food, and Fire: A Connected Risk Landscape
When surface water grows scarce and expensive, farmers may fallow fields or switch crops, affecting food supply and security.
Simultaneously, parched landscapes become more flammable, increasing the likelihood and severity of wildfires near communities and infrastructure.
What Individuals and Communities Can Do
While large-scale policy and infrastructure decisions are essential, individual choices also play an important role in both water conservation and climate mitigation.
Conserving Water at Home
Every household can help reduce pressure on water systems, especially during drought.
Effective actions include:
Cutting Fossil Fuel Use to Tackle the Root Cause
To reduce the long-term intensification of droughts, lowering greenhouse gas emissions is crucial.
Individuals and communities can contribute by:
The UC Davis study makes clear that drought is not only a hydrological event, but also an economic and societal shock.
By integrating surface and groundwater management and accelerating climate action, California—and other drought-prone regions—can better protect water security and stabilize costs.
Here is the source article for this story: Study uncovers concerning phenomenon driving up price of water in US region: ‘The extreme volatility … really surprised me’