How to keep rivers and streams flowing

With streams and rivers drying up because of over-usage, Rob Harmon has implemented an ingenious market mechanism to bring back the water. Farmers and beer companies find their fates intertwined in the intriguing century-old tale of Prickly Pear Creek.

This is a river.

This is a stream.

This is a river.

This is happening all over the country.

There are tens of thousands of miles
of dewatered streams in the United States.

On this map, the colored areas
represent water conflicts.

Similar problems
are emerging in the East as well.

The reasons vary state to state,
but mostly in the details.

There are 4,000 miles
of dewatered streams in Montana alone.

They would ordinarily
support fish and other wildlife.

They're the veins of the ecosystem,

and they're often empty veins.

I want to tell you the story
of just one of these streams,

because it's an archetype
for the larger story.

This is Prickly Pear Creek.

It runs through a populated area
from East Helena to Lake Helena.

It supports wild fish including cutthroat,
brown and rainbow trout.

Nearly every year
for more than a hundred years ...

it looked like this in the summer.

How did we get here?

Well, it started back in the late 1800s

when people started settling
in places like Montana.

In short, there was a lot of water
and there weren't very many people.

But as more people
showed up wanting water,

the folks who were there first
got a little concerned,

and in 1865, Montana passed
its first water law.

It basically said, everybody
near the stream can share in the stream.

Oddly, a lot of people showed up
wanting to share the stream,

and the folks who were there first

got concerned enough
to bring out their lawyers.

There were precedent-setting suits
in 1870 and 1872,

both involving Prickly Pear Creek.

And in 1921,

the Montana Supreme Court
ruled in a case involving Prickly Pear

that the folks who were there first
had the first, or "senior water rights."

These senior water rights are key.

The problem is that all over the West
now it looks like this.

Some of these creeks have claims

for 50 to 100 times more water
than is actually in the stream.

And the senior water rights holders,
if they don't use their water right,

they risk losing their water right --

along with the economic value
that goes with it.

So they have no incentive to conserve.

So it's not just
about the number of people;

the system itself creates
a disincentive to conserve

because you can lose your water
right if you don't use it.

So after decades of lawsuits
and 140 years, now, of experience,

we still have this.

It's a broken system.

There's a disincentive to conserve,

because if you don't use your water right,
you can lose your water right.

And I'm sure you all know,
this has created significant conflicts

between the agricultural
and environmental communities.

OK, now I'm going to change gears here.

Most of you will be happy to know that
the rest of the presentation's free ...

(Laughter)

and some of you'll be happy
to know that it involves beer.

(Laughter)

There's another thing
happening around the country,

which is that companies
are starting to get concerned

about their water footprint.

They're concerned about securing
an adequate supply of water,

they're trying to be really efficient
with their water use,

and they're concerned
about how their water use

affects the image of their brand.

Well, it's a national problem,

but I'm going to tell you
another story from Montana ...

and it involves beer.

I bet you didn't know,
it takes about 5 pints of water

to make a pint of beer.

If you include all the drain,

it takes more than a hundred pints
of water to make a pint of beer.

Now the brewers in Montana

have already done a lot
to reduce their water consumption,

but they still use
millions of gallons of water.

I mean, there's water in beer.

So what can they do
about this remaining water footprint

that can have serious effects
on the ecosystem?

These ecosystems are really important

to the Montana brewers
and their customers.

After all, there's a strong correlation
between water and fishing,

and for some, there's a strong correlation
between fishing and beer.

(Laughter)

So the Montana brewers
and their customers are concerned

and they're looking for some way
to address the problem.

So how can they address
this remaining water footprint?

Remember Prickly Pear.

Up until now, business water stewardship

has been limited
to measuring and reducing,

and we're suggesting
that the next step is to restore.

Remember Prickly Pear.

It's a broken system.

You've got a disincentive to conserve,

because if you don't use your water right,
you risk losing your water right.

Well, we decided to connect
these two worlds --

the world of the companies
with their water footprints

and the world of the farmers

with their senior water rights
on these creeks.

In some states,

senior water rights holders
can leave their water in the stream

while legally protecting it from others,

and maintaining their water right.

After all, it is their water right,

and if they want to use that water right
to help the fish grow in the stream,

it's their right to do so.

But they have no incentive to do so.

So, working with local water trusts,
we created an incentive to do so.

We pay them to leave
their water in stream.

That's what's happening here.

This individual has made the choice
and is closing this water diversion,

leaving the water in the stream.

He doesn't lose the water right,

he just chooses to apply that right,
or some portion of it,

to the stream, instead of to the land.

Because he's the senior
water-rights holder,

he can protect the water
from other users in the stream.

OK?

He gets paid to leave
the water in the stream.

This guy's measuring the water
that this leaves in the stream.

We then take the measured water,

we divide it into
thousand-gallon increments.

Each increment gets a serial number
and a certificate,

and then the brewers and others
buy those certificates

as a way to return water
to these degraded ecosystems.

The brewers pay
to restore water to the stream.

It provides a simple,
inexpensive and measurable way

to return water
to these degraded ecosystems,

while giving farmers an economic choice

and giving businesses
concerned about their water footprints

an easy way to deal with them.

After 140 years of conflict
and 100 years of dry streams,

a circumstance that litigation
and regulation has not solved,

we put together a market-based,
willing buyer, willing seller solution --

a solution that
does not require litigation.

It's about giving folks
concerned about their water footprints

a real opportunity to put water
where it's critically needed,

into these degraded ecosystems,

while at the same time providing farmers
a meaningful economic choice

about how their water is used.

These transactions
create allies, not enemies.

They connect people
rather than dividing them.

And they provide needed economic
support for rural communities.

And most importantly, it's working.

We've returned more than four billion
gallons of water to degraded ecosystems.

We've connected senior
water-rights holders

with brewers in Montana,

with hotels and tea companies in Oregon,

and with high-tech companies
that use a lot of water in the Southwest.

And when we make these connections,

we can and we do turn this ...

into this.

(Applause)

Thank you very much.

(Applause)