What the Inflation Reduction Act Means for Water
As everyone has heard by now, the Inflation Reduction Act (IRA) is a really big deal. In a sweeping motion to turn inflation reduction into green policy, the act grants $369 billion toward climate, $10 billion of which is targeted at water, including drought relief, flood mitigation and climate resiliency, and domestic water infrastructure. It's encouraging to see these two ideas linked - that the path to inflation reduction is through clean energy independence, and the decarbonization of our economy. That the IRA puts the U.S. on a path to a 40% reduction in greenhouse gas emissions by 2030 is a serious win for the planet, and for US environmental policy. Here’s what the IRA means for water…
$4 Billion for Drought Relief
40 million people rely on the Colorado River Basin, a water system that is massively overused and drying up quickly. Just two weeks ago, the United Nations issued a report asserting that Lake Mead and Lake Powell are at risk of reaching “dead pool status”, meaning two of America’s largest reservoirs might run dry. The Colorado River Basin is the lifeblood of the American Southwest, a water system that serves seven states, 30 tribes, 5 million acres of agricultural land and the West’s $26 billion outdoor recreation economy. The IRA grants $4 billion for a compensation scheme to water users who reduce their water consumption either temporarily or over a multi-year period (Sec. 50233). That’s HUGE out West, where the prior appropriation system that governs water use puts a BIG price tag on water rights, many of which date back to the 1800s. These funds help shift incentives so that water users aren’t penalized for failing to max out on their water rights, and so that water can be used more efficiently and effectively. In addition to the $4 billion for the Colorado River Basin, the IRA also includes a $12.5 million provision for emergency Drought Relief for Tribes (Sec. 80004), a comparatively small grant that nevertheless makes a statement in recognizing the importance of tribal water access.
$5.5 Billion for Flood Mitigation and Climate Resiliency
The IRA grants $1.9 billion to the Federal Highway Administration (FHWA) and $3.6 billion to the National Oceanic and Atmospheric Administration (NOAA) in a significant move to address massive challenges in stormwater runoff and to better equip coastal communities for increased heavy rain events. Investing in the Federal Highway Administration may not seem the obvious choice, but the FHWA plays a key role in building and managing the urban infrastructure that are most prone to floods - our roads and highways. With this grant (Sec. 60501) targeted at disadvantaged and underserved communities, the FHWA can focus on upgrading natural infrastructure and pavement to better manage stormwater run-off, which is critical for anyone who wants to halt urban flooding. For those communities on the coast or in the path of hurricanes or heavy rain events, the IRA grant of $3.6 billion to NOAA for research, data collection and the purchasing of equipment and aircraft is essential because we need to know where the water is going so that we can build and defend our infrastructure accordingly. That’s why $2.6 billion (Sec. 40001) is focused on preparing coastal communities for extreme storms and changing climate conditions.
$550 Million for Domestic Water Infrastructure
More than 2 million Americans live with failing or absent water and sanitation systems and many experience raw sewage surrounding and seeping into their homes. Two weeks ago, on a visit to Lowndes County, AL, the initial focus of the extraordinary work of Catherine Flowers, the U.S. Environmental Protection Agency and U.S. Department of Agriculture, announced a $5 million pilot program to help 11 communities recover from unacceptable sewage conditions. The $550 million IRA grant (Sec. 50231) to cover up to 100% of the costs of planning, design and construction of water projects to provide disadvantaged communities and households that do not have reliable water access with continuous domestic water supplies is the next big step forward in the enormous and long-overdue task to redress water inequity.
$10 billion for water is great, especially in the context of the $90 billion the US government has allocated to water in the past year through the Bipartisan Infrastructure Law (2021) and the Drinking Water and Wastewater Infrastructure Act (2021). We’re thrilled that water is finally getting the focused attention it deserves. But $10 billion (even $100 billion) is also only a drop in the bucket for a $434 billion investment gap in drinking water, wastewater, and stormwater combined identified by the American Society of Civil Engineers. And if climate change is most viscerally felt through changes in water, we still have some way to go. Fortunately, we’re lucky enough to work with some of the brightest and bravest water entrepreneurs out there, who are doing the hard work to make us more responsive and resilient to droughts and floods, better equipped to use and reuse water more sustainably, and increasingly able to provide water on a more equitable basis. There’s a whole lot more to do in water and a lot of smart people with their noses to the grindstone.