Oklahoma Water Resources Research Institute Annual Technical Report FY 2008 Oklahoma Water Resources Research Institute Annual Technical Report FY 2008 1 Introduction The Institute for Sustainable Environments (ISE) at Oklahoma State University continues to promote interdisciplinary environmental research, graduate education, and public outreach leading to better understanding, protecting, and sustainably developing the natural environment. The Oklahoma Water Resources Research Institute (OWRRI) is located within the ISE and is responsible for developing and coordinating water research funding to address the needs of Oklahoma. To guide it in meeting this objective, the OWRRI has assembled a board of state regulators, policymakers, and other water resource professionals. This board is known as the Water Research Advisory Board (WRAB). Introduction 1 Research Program Introduction 2008 In 2008, proposals were solicited from all comprehensive universities in Oklahoma. Proposals were received from Oklahoma State University and the University of Oklahoma. Fourteen proposals were submitted and from these, three projects were selected for funding for one year each. - Evaluation of Water Use Monitoring by Remote Sensing ET Estimation Methods (Dr. Yang Hong, OU) evaluated and improved remote sensing ET estimation methods and adapted them for use in Oklahoma. - An Assessment of Environmental Flows for Oklahoma (Dr. Don Turton, OSU) used the Hydroecology Integrity Assessment Process (HIP) developed by the U.S. Geological Survey to assess environmental flows in Oklahoma's perennial streams. - Decision Support Model for Evaluating Alternative Water Supply Infrastructure Scenarios (Dr. Brian Whitacre, OSU) will develop a step-by-step procedure that rural water systems can follow to assess their water supply infrastructure needs and to plan and locate funding for needed improvements. This project experienced delays and is not complete. An interim report is included here and the final report will be submitted with next year's annual report. 2007 Also, included in this report are the final technical reports for the three projects funded in 2007. All were granted extensions due to delays in funding during 2007. These projects were: - Subsurface Transport of Phosphorus to Streams: A Potential Source of Phosphorus not Alleviated by Best Management Practices (Dr. Garey Fox, OSU) - Determination of Fracture Density in the Arbuckle-Simpson Aquifer from Ground Penetrating Radar (GPR) and Resistivity Data (Dr. Ibrahim Cemen, OSU) - Decision Support Model for Optimal Water Pricing Protocol for Oklahoma Water Planning: Lake Tenkiller Case Study (Dr. Tracy Boyer, OSU) Research Program Introduction 1 Decision Support Model for Optimal Water Pricing Protocol for Oklahoma Water Planning: Lake Tennkiller Case Study Basic Information Decision Support Model for Optimal Water Pricing Protocol for Oklahoma Title: Water Planning: Lake Tennkiller Case Study Project Number: 2007OK78B Start Date: 3/1/2007 End Date: 6/16/2008 Funding Source: 104B Congressional District: 3 Research Category: Social Sciences Focus Category: Economics, Surface Water, Water Use Descriptors: Water Pricing, Non-Market Valuation, Water Allocation Principal Investigators: Tracy Boyer, Larry Sanders, Arthur Stoecker Publication Decision Support Model for Optimal Water Pricing Protocol for Oklahoma Water Planning: Lake Tennkiller1 Case Study Final Report Oklahoma Water Resources Research Institute (FY 2007) Title: Decision Support Model for Optimal Water Pricing Protocol for Oklahoma Water Planning: Lake Tenkiller Case Study Start Date: (3/1/2007) End Date: (6/16/2008) Congressional District:3 Focus Category: Water Use, Surface Water, Economics Descriptors: ECPM; M&P, SW, WQN, WS, WU Principal Investigators: Tracy Boyer, Agricultural Economics, Oklahoma State University; Art Stoecker, Agricultural Economics, Oklahoma State University, and Larry Sanders, Agricultural Economics, Oklahoma State University. Publications: none Students Trained and Supported: Student Status Number Disciplines Undergraduate 1 Agricultural Economics M.S. 3 Agricultural Economics Ph.D. 1 Agricultural Economics Post Doc Total 5 1 Section I: Problem and Research Objectives Objectives The objective of this study was to develop a water pricing model that could be used in the state water planning process. The model considers both monetary and opportunity costs in the allocation of surface water between competing uses. The model was constructed for Tenkiller Ferry Lake in Sequoyah and Cherokee counties. The specific purpose was to develop a water pricing protocol that (1) internalizes monetary and opportunity costs of water storage, treatment, and delivery systems; and (2) generates an sustainable supply of water over the 2010‐2060 period. Background The lake dam is located in the Arkansas River Basin on the Illinois River in Sequoyah County. The lake is among the Oklahoma’s 34 major reservoirs that store 13 million acre‐feet of water. The structure was federally authorized for flood control and hydroelectric power. Construction was completed by the US Army Corps of Engineers (USACE) in 1953. The lake has 130 miles of shoreline with a mean depth of 51 feet. Capacity is 654,100 acre feet at the normal pool and 1,230,800 at the flood pool (OWRB Fact Sheet). The main beneficial uses of the lake are recreation, flood control, power generation, stream flow maintenance and municipal and industrial use. The need for an economic model that optimizes net benefits from multiple water uses and tracks water balances for Tenkiller and other lakes is illustrated by statements from the U.S. Army Corps of Engineers (USACE) 2001 report on a proposed water treatment and conveyance study (USACE, 2001). According to the 2001 USACE report Lake Tenkiller had water rights of 29,792 acre feet with 14,739 feet allocated. Applications were pending for 172,714 acre feet. The USACE report found the 9,096 acre feet of water rights owned by the participating systems are insufficient to meet demands by the year 2050. The report further pointed out that “..having sufficient water rights does not guarantee a …. system would have enough water to meet projected demands. Water storage must also be considered” The optimization model illustrates the tradeoffs between managing for market uses (municipal and hydropower) and managing for all uses including market and recreational uses (non‐market) of surface water resources. When non‐market uses, in this case, recreation, are ignored, these values are assumed to be zero in the management process. The results of this modeling process illustrate the economic importance of recreational uses by showing that when recreational values are explicitly considered in the optimization model, surface water pool levels are maintained at normal pool level during peak summer months of recreational use. Although securing water supplies, hydropower, and flood control provided the original motivation for creating Tenkiller Dam, like many other reservoirs in the Oklahoma system, the subsequent recreational values prove significant and maintenance of water rights for users and the regional economies should be also explicitly considered in the state water planning process. 2 Current recreational values for lake use were not available for Oklahoma. Thus this study first conducted a statewide recreational valuation study to provide as input into this model and future state water planning studies. Accordingly, the final report is divided into sub‐reports to provide results on the specific objectives of the project as follows: Section II Valuation of Oklahoma Lakes II.1 Problem and Research Objectives Oklahoma Lake Valuation II.2 Methodology of Oklahoma Lakes Survey II.3 Principal Findings and Significance of Oklahoma Lakes Survey Section III Construction and Optimization of a Lake Model for Power, Municipal, and Recreation III.1 Objectives III. 2 Review of Lake Management Modeling III.3 Principal Findings and Significance Section IV Extension of Research Results IV.1 Methodology IV.2 Principal Findings and Significance Methodology Section II. Valuation of Oklahoma Lakes The state of Oklahoma has over 300 lakes, more man‐made lakes than any other state, with over one million surface acres of water (Oklahoma Tourism and Recreation Department, 2007). Many of lakes are used for several reasons such as hydroelectric power, flood control, agriculture, and recreation. Since the mid 1950s, demand for lake recreation in Oklahoma has increased continuously due to increased convenience of transportation, communication, and other technologies such as types of vehicles and types of new watercrafts available to public (Caneday, 2000). The outdoor recreation business was reported as one of the fastest growing businesses in Oklahoma (Oklahoma Tourism and Recreation Department, 2001). Even though the demand for lake recreation in Oklahoma is increasing, few recent studies have analyzed the 3 demand for lake recreation as well as welfare effects from lake use in term of recreation (Jordan and Badger, 1977). Caneday and Jordan (2003) studied the behavior of Oklahomans traveling to state parks, but they did not estimate economic values for water based amenities such as quality and quantity or estimate total visitation across all water‐oriented recreational activities. Therefore, currently, there is no comprehensive explanation for lake recreation demand in Oklahoma. II.1 Problem and Research Objectives of Oklahoma Lake Valuation This study estimated