The next big environmental battle is closer and wetter than you think

If you’re looking for something new to be concerned about, put Minnesota’s alleged abundance of water on your list and put a question mark next to it. Why? Because at some point – perhaps even not that far down the line – you may see a highly charged public debate here and elsewhere about whether the state should start exporting our most precious natural resource for profit to private companies, water brokers, appointed and elected water czars in other states and so on. Sound crazy? It’s not.

In 2019, Minnesota Public Radio (MPR) reported “the surprising news that a company in Lakeville, Minn., wants to pump water from below the ground in Dakota County and transport it by rail to the western United States, where water is scarce. Environmental groups quickly opposed the idea. The Minnesota Department of Natural Resources said the plan likely won’t meet state law. But could a plan like this ever become reality?”

A dramatically growing global problem

Water scarcity, especially out West, is not just an issue in this country. It’s a dramatically growing global problem. According to the Bloomberg Green business publication, “2 billion people now live in nations plagued by water problems, and almost two-thirds of the world could face water shortages in just four years,” Tim McCourt, global head of equity index and alternative investment products at CME, said in an interview. “The idea of managing risks associated to water is certainly increased in importance.”

What McCourt and many others mean when they talk about “managing risks” is making water a commodity like grain, oil, gold, other minerals, etc., to be freely traded on a stock exchange. While you were busy in December prepping for the holidays, dodging the pandemic and doing your regular routines, one such exchange already opened.

Water began trading as a commodity on Wall Street on Dec. 8, 2020, when the nation’s first water market launched on the Chicago Mercantile Exchange, with $1.1 billion in contracts tied to water prices in California, Bloomberg News reported. It was tied directly to the California Water Index, California being one of the large states out West — like Colorado — that always seems to be at the mercy of nature to provide good snow packs for trickle down water resources for many uses, from agriculture to potable water. Now you can add investors to that wet mix.

The same article notes that “climate change, droughts, population growth, and pollution are likely to make water scarcity issues and pricing a hot topic for years to come.” Guess where many could look to supply H2O? Yes, the land of 10,000 freshwater lakes and our Great Lakes, chief among them Lake Superior. The largest freshwater lake in the world, Superior currently is estimated to contain 3 quadrillion gallons — enough to cover both North and South America under a foot of water, says visitcookcounty.com!

For now, protective legislation like The Great Lakes Compact in 2008 bans water diversion from the Great Lakes, with some exceptions. But as that 2019 MPR report noted, our state may even face its own water shortages: “Minnesota is starting to come to grips with the fact that it does not have an endless supply of water. There’s growing concern in certain parts of the state — including the Twin Cities metro area and farmland in central and southern Minnesota — and that development and irrigation of farm fields are depleting groundwater sources too quickly.”

Remember ‘Chinatown‘?

You don’t have to look far to begin to understand that the issues and implications around water scarcity are widespread and often complicated. Remember that classic movie “Chinatown”? At the heart of the film was a story about water rights – and theft – in California set many decades ago. So what should we be thinking about our water in Minnesota – and about water and water rights in general everywhere?

Perhaps a bit more background, like this insightful story from Erb Institute for Business Sustainability (“A Right to Water – Is Water a Human Right or a Commodity,”) will help give us some clarity. “In 2010, the UN General Assembly adopted a resolution affirming the human right to clean drinking water and sanitation. The motion passed with 122 nations voting in favor and no votes against, but 44 nations abstained. Those that abstained—including the United States (my emphasis)—suggested that a right to water was unclear, unnecessary or premature, given existing rights and other ongoing negotiations. The countries supporting the resolution argued that water was essential for life and noted that large portions of the population lack access to clean drinking water and adequate sanitation.”

In 2002, the same report continues, “the UN Committee on Economic, Social and Cultural Rights had adopted Comment 15, which stated: ‘The human right to water is indispensable for leading a life in human dignity. It is a prerequisite for the realization of other human rights.’ The 2010 declaration reaffirmed this right and made it explicit, and it was subsequently approved by consensus at the UN Human Rights Council, of which the U.S. was a member, in motions in 2010 and 2011, making it legally binding in international law.”

So is water a human right or a commodity?

“The problem is that it’s both,” said Peter Gleick of the Pacific Institute in Berkeley. Everyone has a right to safe, clean water, he said, but because of government failures, 1.1 billion people lack access to it,” reported the Los Angeles Times in 2012. “A new trend is clear. Both Suez and Vivendi [big French companies that supply water to urban areas in the first and third worlds] expect double-digit annual growth in their water business, and each already has contracts that total more than $10 billion a year. Puerto Rico just hired Suez to distribute its water.”

Meanwhile, back on the new water stock exchange, “the market allows farmers, hedge funds, and municipalities to hedge bets on the future price of water and water availability in the American West. The new trading scheme was announced in September, prompted by the region’s worsening heat, drought, and wildfires fueled by climate change. There were two trades when the market went live Monday,” Bloomberg News reported in December.

Other proponents say the new exchange “will clear up some of the uncertainty around water prices for farmers and municipalities, helping them budget for the resource,” according to the Yale Environment 360 source. “But some experts say treating water as a tradable commodity puts a basic human right into the hands of financial institutions and investors, a dangerous arrangement as climate change alters precipitation patterns and increases water scarcity.”

Water is a public good

Minnesota is the top of three continental sized watersheds. At Minnesota Lakes and Rivers Advocates, we believe we bear a responsibility to the states downstream. But Minnesota also has falling aquifers. Fifty six percent of Minnesota’s lakes and rivers are listed by the Minnesota Pollution Control Agency as impaired. Water is a public good, and not a commodity to be traded or sold. We do not support exporting Minnesota’s water out of state through a pipeline, tanker truck, ship or rail car.

The issue is bound to become more focused and controversial as water becomes less available and climate continues to exacerbate water issues. You know the issue has arrived when even Stephen Colbert recently tackled the subject in one of his funny-but-serious “Uh-Oh” TV segments!

And then there’s water’s potential connection to pipelines. When water becomes more valuable than oil, will those pipelines pump the other direction?

Jeff Forester is the executive director of Minnesota Lakes and Rivers Advocates, and the author of  “The Forest for the Trees, How Humans Shaped the Northwoods,” an ecological history of the BWCA.

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