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Spotlight on Economics: Time to Consider Water Quality and Economic Good

Efforts to maintain environmental quality need not threaten economic growth.

By Robert Hearne, Associate Professor

NDSU Agribusiness and Applied Economics Department

North Dakota is a state with an abundance of resources and relatively few people. Because of this, the state generally has favored policies that support economic growth and has had less concern for environmental protection than other, more populous states. The economic justification for this is clear. With few people damaged by reductions in environmental quality, these damages tend to be relatively small.

In terms of water policy, North Dakota has focused attention on getting federal support for large infrastructure polices that move quantities of water. These projects include a diversion of floodwaters around Fargo and adjacent communities, a diversion of Missouri River water to the Red River of the North Basin, and alternative diversions of rising Devils Lake water to the Sheyenne River. It is now time for North Dakota to pay greater attention to water quality concerns. High-quality water is scarce and valuable, so it is an economic good. Because we all enjoy its benefits without exclusion, it is a public good that should be protected for the public.

Three somewhat recent developments give reason for increased concern about water quality. These are increased crop acreage, oil drilling and fracking, and discharges from Devils Lake. Increased crop prices and expiring Conservation Reserve Program contracts will lead to increased crop acreage, shifting rotations, reduced riparian buffer areas and increased use of agrichemicals. Some of these trends might be offset by gradual shifts toward conservation tillage and nitrogen-fixating soybeans. However, in general, these trends should be expected to increase nonpoint source pollution and decrease surface water quality.

Western North Dakota’s booming oil industry will impose great stresses on the region’s water resources. These stresses have been alleviated by a recent U.S. Army Corps of Engineers decision to allow drillers access to surplus Lake Sakakawea water. However, the treatment, reuse and disposal of wastewater and brine from drilling and fracking activities will continue to stress resources, especially because of the large volumes of water involved. Although most of the news about the dangers of fracking wastewater disposal have come from the Marcellus shale formation centered in Pennsylvania, North Dakota water managers need to be concerned about the environmental consequences of wastewater disposal on surface waters and deep wells.

The continuing rise in Devils Lake water already has imposed devastating damages to farms and communities inside the Devils Lake Basin. As the state attempts to mitigate these damages and reduce the risk of a ruinous spillover into the Tolna Coulee, discharges from the current and future outlets will increase erosion, salinity, suspended solids and sulfates in the downstream Sheyenne and Red rivers. This reduction in water quality should not be considered to be catastrophic. However, efforts to monitor water quality and mitigate potential damages should increase as diverted water increases. The State Water Commission has started to address this issue but does not fully address water quality concerns.

In North Dakota, the county water resource boards have the responsibility to permit discharges into surface waters. The Water Quality Division of the North Dakota State Department of Health is responsible for implementing state and federal water quality laws and programs. Like most of North Dakota’s local and state agencies, including NDSU, these organizations accept big responsibilities with very restricted resources. However, these new stresses on water resources will imply the need for increased resources dedicated to monitoring and analyzing water quality and enforcing regulations. The state should cooperate with any federal government or research center effort to understand the environmental consequences of fracking. New regulatory efforts may be needed and should be assessed.

North Dakota is enjoying boom times with its agricultural and energy activities. It also is enjoying the benefits of decades of private and public stewardship of its natural resources. Efforts to maintain environmental quality need not threaten economic growth. But a balanced path toward economic growth that respects the economics benefit of nonmarket environmental goods and services, such as water quality, would be the most beneficial path for current and future generations of North Dakotans.

NDSU Agriculture Communication – May 23, 2012

Source:Robert Hearne, (701) 231-6494, robert.hearne@ndsu.edu
Editor:Rich Mattern, (701) 231-6136, richard.mattern@ndsu.edu
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