# Targeting Investment in On-farm Surface Water Storage for Groundwater Conservation

## TL;DR

This paper studies how subsidizing on-farm water storage can help conserve groundwater while balancing costs and benefits.

## Contribution

The study introduces a model to evaluate the social net benefits of groundwater conservation through on-farm surface water storage subsidies.

## Key findings

- A subsidy for on-farm surface water storage yields a $12.32 social net benefit per acre-foot over thirty years.
- Groundwater conservation is most effective in areas with high rice yield and high natural recharge.
- Subsidies can lead to a rebound in groundwater levels at sites where it was nearly exhausted.

## Abstract

Optimal investment in conservation requires balancing the benefits of conservation against its costs. We model the benefit of groundwater, less the cost of conserving groundwater through a subsidy for on-farm surface water storage. On-farm surface water storage reduces arable land but provides a substitute for groundwater used in irrigation. The average social net benefit from conserving water is $12.32 per acre-foot after thirty years with the current subsidy for surface storage, and the aquifer thickness rises by 10.6%. The average social net benefit of groundwater conserved rises by lowering the subsidy, but the volume of conservation also declines. A third of the sites where groundwater is nearly exhausted after thirty years increase surface storage with the subsidy and experience a rebound in groundwater volumes. Conserving groundwater with the subsidy generates the highest net benefit for sites with a high yield for rice, a low yield for dryland soybean, a low depth to the aquifer, and high natural recharge.