By Jerd Smith | The Colorado Sun
The deal, which could be worth more than $44 million, includes Colorado Springs Utilities and is expected to close early next year
Xcel Energy will offer water it owns but no longer needs to farmers in the water-strapped Lower Arkansas River Valley, in an innovative deal advocates hope will help the struggling region regain control of vital water supplies and protect its agricultural economy.
Under the preliminary terms of the proposal, valued at more than $44 million, Xcel will sell 12,500 acre-feet of water to a newly formed irrigation company, 70% of which will be owned by farmers and 30% of which will be owned by Colorado Springs Utilities.
An acre-foot of water equals 326,000 gallons, enough to serve two to four urban households for one year, or enough to cover an acre of farmland with a foot of water.
The news comes as tensions continue to rise between farm interests in the Lower Arkansas River Basin and cities, such as Colorado Springs and Aurora, that continue to tap its water to supply growth.
Advocates say this new project may be an important new method for reducing those tension by keeping farm water in the communities where it has historically been used.
The water sale is backed by a coalition that includes Xcel Energy, the Palmer Land Conservancy, farmers and Colorado Springs Utilities. The planning work is funded by a $245,000 grant from the Colorado Water Conservation Board and additional support from Colorado Springs and Palmer.
“The new company means farmers will become owners,” said Jennifer Jordan, a spokesperson for Colorado Springs Utilities. “It also means the water will remain in the Arkansas Basin.”
Xcel bought the water back in the 1980s as part of a new coal-fired power plant project that never materialized. Since then, the power company has leased the water to farmers in the region under year-to-year contracts.
The decision to sell the water to farmers is an effort by Xcel to aid the community, according to Todd Doherty, a principal with Western Water Partnerships, which is coordinating the sale.
“Xcel is really wanting to leave this community as good as, or better off, than they found it,” Doherty said. “They could have sold the water to the highest bidder and walked away.”
Closing coal-fired power plants frees up water
Xcel officials did not respond to a request for comment. The power company is also involved in another, larger water sale on the Western Slope, where it has agreed to sell several hundred thousand acre-feet of water it owns on the Colorado River to local water districts and cities.
Power companies are closing coal-fired power plants across the state and the country, and Doherty said the hope is the sale to a company majority-owned by farmers could serve as a model when water previously used for power production is sold.
READ THE FULL ARTICLE AT THE COLORADO SUN
