Economic analyses of tailwater recovery systems

Author(s): Omer, A.

Tailwater recovery (TWR) systems are being implemented on agricultural landscapes to reduce nutrient loss and save water on the landscape for irrigation. These systems are a large financial investment for both government agencies (United States Department of Agriculture Natural Resources Conservation Service) and private producers with total costs ranging from $400,000-900,000. Although economic analyses of TWR systems have been modeled, analyses of implemented TWR systems have yet to be completed. Economic studies are necessary to guide adaptive management of conservation funding for appropriation in methods with the greatest return. Therefore, an analysis was conducted on the costs and benefits of TWR systems. Net present values (NPV) and benefit to cost ratios (BCR) of TWR systems were used to compare the benefits to the costs. Three discount rates of 3, 7, and 10% were used on both rented and owned land schemes. Five TWR system scenarios were used in the investigation including dryland, irrigated, irrigation improvements, TWR systems, and TWR systems with external benefits of sediment loss mitigation. NPV and BCRs were positive and greater than one for TWR systems if producers owned the land but remained negative or less than one if land was rented. Beyond improvements to irrigation infrastructure, farms with a TWR system installed lost NPV of $51 to $328 per ha. The range of mean total cost to reduce solids using TWR systems was $0 to $0.77 per kg; P was $0.61 to $3,315.72 per kg; and N was $0.13 to $396.44 per kg. The range of mean total cost to retain water using TWR systems was $189.73 to $628.23 per ML, compared to a range of mean cost of groundwater of $13.99 to $36.17 per ML. Compared to other conservation practices designed to reduce solids and nutrients, TWR systems are one of the least expensive ways to reduce solid losses from the landscape but remain an expensive way to reduce nutrient losses. Using TWR systems to provide an additional source of irrigation water yields a wide range in costs from less expensive than water efficiency conservation practices to similar to the high costs of practices such as desalination. Therefore, TWR systems may be a more expensive conservation practice to retain nutrients and water on the agricultural landscape than other solutions.

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