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From The Salt Lake Tribune:

Water managers in the Upper Colorado River Basin know the number by heart: 3,525. It refers to an elevation, a topographic ring around the shores and walls of Lake Powell, and it signals a crisis. At 3,525 feet above sea level, the federally owned reservoir could only spare another 40-foot drop before reaching “dead pool” — where power generation at the Glen Canyon Dam becomes impossible. Below that lies a worst-case scenario where hundreds of billions of gallons of water would be trapped with no easy way to release them into the Grand Canyon below.

The reservoir is currently 40% full and its elevation is 50 feet above 3,525, but that level could be exposed in just a couple of bad snow years in the river’s headwaters, given the continued demands of the 40 million people across seven states, two countries and 29 Native American nations who rely on the river. […]

The question, and the point where consensus begins to fracture, is what to do. Many see a need to continue what’s always been done in the river basin: the hashing out of differences in board meetings and conference halls […].  Others hear a death knell for Glen Canyon Dam.

But another controversial vision has roared back to life in recent months that would upend nearly a century and a half of precedent. Hedge funds and other Wall Street interests want to rewrite the “Law of the River” in the Colorado River Basin and use the free market to solve the problem of scarcity — while potentially raking in immense profits.

Privatizing water resources has long been the dream of l!bertarian-leaning think tanks, and publications from the F!nancial Times to F0rbes have referred to water as “the next oil.” If geopolitical conflicts and vast swaths of the global economy in the 20th century were driven by fossil fuels, some analysts predict a repeat in this century with a different commodity.

Partners at Water Asset Management (WAM), a New York-based hedge fund that invests in water around the world, have been involved with Western water since the 1990s. […] “I have seen time and again the wisdom of using incentives that attract private-sector investment and innovation,” James Eklund, legal counsel for WAM, recently told The New York Times. […] Eklund formerly served as a top water negotiator for Colorado, and his comments in the article set off a flurry of rebuttals […].

WAM had invested $300 million in farmland in Colorado, California, Arizona and Nevada as of last year, including $16.6 million on 2,220 acres of farmland with senior water rights in Colorado’s Grand Valley just upstream from where the Colorado River crosses into Utah. So far, farming has continued on the hedge fund’s plots in the Grand Valley […].

They also expect a hefty return on investment. The hedge fund’s co-founder and president, Matthew D!ser!o, has called water in the United States “a trillion-dollar market opportunity.” […] D!sque De@ne Jr., another partner at WAM, told ProPublica in 2016 that he is interested in freeing up rules that regulate water trading. Deane argued that commodifying water and making it a tradable asset on the market would encourage conservation, rewarding those who cut back on use and enabling them to sell it to others who would in turn be encouraged to conserve during droughts. […]

The same report in The New York Times noted that lobbyists are pushing for the creation of private “accounts” in Lake Powell, a move that would partially privatize the federally owned reservoir. If that happened, investors could theoretically dry up farmlands, which use the vast majority of water in the basin, and store the savings in the reservoir to sell to cities during shortages. Eklund has since denied that WAM’s goal is the creation of a private account in Lake Powell, though the hedge fund has used rotational fallowing on its farmland in Arizona to divert over 2 billion gallons to an account in Lake Mead, according to a presentation one of its partners gave last year.

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Headline, image, caption, and text excerpt published by: Zak Podmore. “Exclusive: Hedge funds eye water markets that could net billions, as levels drop in Lake Powell.” The Salt Lake Tribune. 7 February 2021.

First screenshot (”The Colorado River forms 76 miles of the Reservation’s western border …”) from: Navajo Reservation profile, GRCA History, Arizona State University. Second screenshot (”Today, national media is focused on Navajo water insecurity …”) from: Andrew Curley. “Contested water settlements …” H/C/N. 11 August 2020.