Water is already a major concern in the Southwest, where homes, businesses and farms use far more water than is produced by rain and snowfall, and groundwater reserves are shrinking.

This study quantifies the impact of climate change on the problem. It finds that without prompt action to reduce water usage, Arizona, California, Nevada, New Mexico, and Utah will face a combined shortfall of 1,815 million acre feet from population and income growth alone, plus 282 million to 439 million more from climate change – at a combined cost of as much as trillion.

And that's if the shortfall can be made up at all. As conventional water sources dry up, the Southwest could find itself facing serious water crises in dry years, with unexpected disruptions that could devastate agriculture and affect homes and businesses as well.

"Climate change is affecting Americans in many areas; the water crisis in the Southwest is one of the clearest examples," said Frank Ackerman, director of the Climate Economics Group at SEI-U.S. and lead author of the study. "Climate policy choices we make today are not just about exotic environments and far-future generations – they will help determine how easy or hard it is to create a sustainable water system in the most arid region of the country."

The authors also evaluate potential ways to meet the shortfall, including water imports, desalination and additional groundwater extraction, and conclude that none can solve the problem. To avoid serious water crises, they recommend, the Southwestern states should promptly implement substantial conservation and efficiency measures as well as price increases for both urban and agricultural users. They also advise phasing out low-value crops, some of which are worth less than the water used to grow them.

This report is part of a package that also includes California Water Supply and Demand: Technical Report and The Water-Energy Nexus in the Western States: Projections to 2100.

Download the report (pdf, 906kb)