Farm-level impacts of alternative groundwater management scenarios over the high plains aquifer in Wyoming

Southeastern Wyoming depends heavily on the High Plains Aquifer for irrigation water, yet withdrawal rates in this area are higher than recharge rates, causing declines in groundwater levels. We use a farm-level dynamic optimization model to determine potential economic and hydrologic impacts of three alternative groundwater management scenarios compared to the status quo: constrained allocation, which limits the allowable amount of applied water; a buyout in which producers are compensated for voluntarily retiring irrigated land; and an uncompensated conversion to dryland crop production. The model has economic (optimal crop mix on five representative farms), hydrologic (dynamic relationship between groundwater use and saturated thickness, depth to water levels, and well pumping capacity), and agronomic (relationship between water application levels and crop yields) components. Optimal management decisions identified within the model vary among the representative farms due to local differences in aquifer characteristics and recharge profiles. For farms already feeling the effects of aquifer depletion – such as reduced pumping capacity – the economic impacts of an allocation scenario are lower because their farming system is already well-adapted for limited water. The buyout scenario creates both economic and hydrologic benefits, but a source of funding would be needed to support it. Economic and hydrologic benefits of a buyout program also depend on whether pivots near those enrolled in the programs are restricted to historical consumptive use. If there is no restriction, economic benefits to remaining pivots increase, but hydrologic benefits decrease. This study highlights the need for reliable hydrologic information in decision-making. • Pumping limits and water conservation policies can slow aquifer drawdown. • Pumping limits may have less economic impact on farms already affected by drawdown. • Aquifer heterogeneity leads to different economic impacts on farms in the same area.