Pilot System Conservation Program (Pilot Program)

Historic Pilot Program Established

In 2014, the Bureau of Reclamation, the Colorado River Basin States and Colorado River water users explored ideas that could mitigate the impacts of the ongoing drought in the Colorado River Basin. One idea that received broad support was funding projects that would test a wide range of measures to conserve Colorado River water in Lake Powell or Lake Mead as Colorado River System water for the benefit of all users to help offset declining reservoir elevations.

aerial view of Lake MeadOn July 30, 2014, Reclamation signed an agreement with the Central Arizona Water Conservation District, The Metropolitan Water District of Southern California, the Southern Nevada Water Authority, and Denver Water (Local Funding Agencies) for a Pilot Program for Funding the Creation of Colorado River System Water through Voluntary Water Conservation and Reductions in Use, as amended (Funding Agreement). The Funding Agreement is historic because, for the first time, water agencies from both the upper and lower Colorado River basins and Reclamation agreed to jointly fund voluntary water conservation projects to benefit the Colorado River System in both the upper and lower Colorado River Basins.

The Pilot Program is testing a wide range of water conservation concepts that reduce water use and help to determine if voluntary, measurable reductions in consumptive use of Colorado River water constitute a feasible and cost-effective approach to partially mitigate the impacts of long-term drought on the Colorado River System. Colorado River water conserved as a result of the Pilot Program is for the sole purpose of increasing storage levels in Lake Powell and Lake Mead and will not accrue to the benefit or use of any individual water user. Under Public Law 113-235, the Secretary of the Interior is required to submit a report to Congress that evaluates the effectiveness of the Pilot Program. The report to Congress is being prepared to reflect Pilot Program project implementation through 2019.

Reclamation’s Lower Colorado Region is the implementing agency for the Pilot Program in the Lower Colorado River Basin (Lower Basin), while the Upper Colorado River Commission (see Quick Links to access website) was the implementing agency in the Upper Colorado River Basin (Upper Basin). As of 2019, in the Lower Basin, the Pilot Program is comprised of three phases of project implementation which are described below.

Under the Funding Agreement, Reclamation and the Local Funding Agencies originally contributed $11 million ($3 million from Reclamation and $2 million each from the Local Funding Agencies). The Funding Agreement allocated a minimum of $2.75 million for conservation projects in Upper Basin and up to $8.25 million in the Lower Basin. Beginning in 2015, the Funding Agreement has been amended several times to provide for additional Federal and non-federal financial contributions, including non-federal funding from third-party contributors. In the Lower Basin, Federal funds have been appropriated for the Pilot Program from fiscal year 2015 through fiscal year 2019. Federal funds, along with non-federal contributions from the Local Funding Agencies and the Walton Family Foundation (WFF) through the Environmental Defense Fund, Inc. (EDF) as a Third-Party Contributor, have resulted in implementation of 16 Pilot Program projects in the Lower Basin. By the end of 2019, the Pilot Program is expected to create 175,347 acre-feet of system conservation in Lake Mead at a total cost of approximately $29.8 million or approximately $170 per acre-foot. The Federal/non-federal cost share is 47/53 percent, respectively. Some of the Pilot Program projects are being implemented over a several-year period and require continued oversight and administration by Reclamation.

Pilot Program Accomplishments in the Lower Basin for Phase 1

In October 2014, Reclamation’s Lower Colorado Region announced an opportunity for Colorado River water entitlement holders to participate in the Pilot Program which is known as “Phase 1”. Six proposals were selected for implementation in Phase 1 by Reclamation and the Local Funding Agencies. Actual Phase 1 costs are $8,441,400.00. The Phase 1 projects will collectively conserve approximately 58,147 acre-feet (AF) of Colorado River water in Lake Mead for an average amount paid to the participant of approximately $131/AF.

Pilot System Conservation Program Lower Colorado River Basin Projects – Phase 1
Participant State1 Water Conservation Method Estimated
Water Conservation (AF)
Total Cost Cost/AF
Southern Nevada Water Authority NV Project dedicated a portion of Muddy and Virgin River water historically used for agriculture to storage in Lake Mead in 2015 and 2016 in lieu of creating Tributary Conservation Intentionally Created Surplus credits. 15,000 $2,250,000 $150
Bullhead City AZ Project recovers effluent that was previously lost to evaporation through installation and operation of wells that inject the treated water into the Colorado River aquifer over a 5-year period, beginning in fall 2017. 4,400 $520,000 $118
Tohono O’odham Nation (TON) AZ Project conserved TON Central Arizona Project (CAP) water in Lake Mead in 2015 in lieu of storing the water underground in AZ. 10,080 $2,550,240 $2532
Coachella Valley Water District CA Project offers rebates to farmers to convert up to 71 acres of farm land from flood/furrow irrigation to drip irrigation. Water conservation began in 2016 and will continue through 2019. 532 $106,500 $200.193
Central Arizona Water Conservation District (CAWCD) AZ Project conserved CAP Excess Agriculture Pool water in 2016 by CAWCD reducing delivery of such water to 11 irrigation districts located within the CAP service area. The reduction in deliveries to the 11 irrigation districts was accomplished through a combination of fallowing, deficit irrigation, and increased use of local water supplies. 25,265 $2,509,660 $99.33
City of Needles CA Project removed 40 acres of turf from the City’s golf course to conserve an estimated 2,870 AF of Colorado River water over approximately a 20-year period beginning in 2016. 2,870 $505,000 $176
Total 58,147 $8,441,400
Average Cost $145.174
  1. NV=Nevada, AZ=Arizona, and CA=California.
  2. The $253 per acre-foot cost consists of a payment of $171 per AF to the TON and an $82 per AF payment to CAWCD to cover the fixed operation, maintenance, and replacement cost associated with the non-delivery of the CAP water.
  3. The amount is based on payment to CVWD of $1,500/acre converted from flood/furrow irrigation to drip irrigation.
  4. Total cost covered by initial Lower Basin contributions of $8.25 million by the funding partners plus an additional contribution of $1 million by CAWCD and $85,400 by Reclamation.
  5. Average cost. Excluding the $82 per AF paid to CAWCD for fixed costs, the average amount paid to project participants is approximately $131/AF.

Pilot Program Accomplishments in the Lower Basin for Phase 2

In March 2016, the Lower Colorado Region announced a second opportunity for Colorado River water entitlement holders to participate in the Pilot Program known as “Phase 2”. Reclamation and the Local Funding Agencies selected four new projects and approved the expansion of a Phase 1 project with Bullhead City. The TON project and the Colorado River Indian Tribes’ (CRIT) project both included an option for a second year of system conservation. The second-year option in both projects was exercised. The Phase 2 projects including the second year of system conservation in the TON and CRIT projects are expected to create 53,878 acre-feet of system conservation in Lake Mead at an average cost of $171.75/AF.

Pilot System Conservation Program Lower Colorado River Basin Projects – Phase 2
Participant State Water Conservation Method Estimated
Water Conservation (AF)
Total Cost Cost/AF
SNWA NV Project dedicates a portion of Virgin River water from post-1929 water rights leased by SNWA from Bunkerville Irrigation Company to storage in Lake Mead for a 3-year period beginning October 1, 2016 through September 30, 2019. 2,437 $188,591.57 $77.391
Bullhead City AZ Project recovers effluent that is was previously lost to evaporation through installation and operation of wells that inject the treated water into the Colorado River aquifer. The duration of the original project was extended for 3 more years from 2021 through 2023 to conserve an additional 4,400 AF of water. 4,400 $518,200.00 $118.00
TON AZ Project conserved TON CAP water in Lake Mead in 2016 in lieu of storing the water underground in AZ. 9,817 $1,725,338.00 $175.75
Second-year option conserved TON CAP water in Lake Mead in 2017 in lieu of storing the water underground in AZ. 10,080 $1,814,400.00 $180.00
Colorado River Indian Tribes (CRIT)
Kudu Farms
AZ Project fallowed 1,591 acres of farmland during the fallowing period beginning October 1, 2016 through September 30, 2017. 8,572 $1,618,545.00 $188.822
Second-year option fallowed 1,591 acres of farmland during the fallowing period beginning October 1, 2017 through September 30, 2018. 8,572 $1,630,775.00 $190.24
Gila River Indian Community (Community) AZ Project conserved Community CAP water in Lake Mead in 2016 in lieu of storing the water underground in AZ. 10,000 $1,757,500.00 $175.75
Total 53,878 $9,253,349.57
Average Cost $171.75
  1. The cost per AF is $75 in 2017, $77.27 in 2018, and $79.57 in 2019. Average cost is $77.39 based on the total volume of system conservation expected to be created during the 3-year project.
  2. The cost per AF is $75 in 2017, $77.27 in 2018, and $79.57 in 2019. Average cost is $77.39 based on the total volume of system conservation expected to be created during the 3-year project.

Pilot Program Accomplishments for in the Lower Basin for Phase 3

In October 2017, the Lower Colorado Region announced a third opportunity for Colorado River water entitlement holders to participate in the Pilot Program in the Lower Basin. Pilot Program project proposals were received from five entities with one of the entities, CRIT, submitting agricultural farmland fallowing proposals for two different farms. In 2018 and 2019, pursuant to Amendment No. 3 of the Funding Agreement, the EDF on behalf of the WFF participated in Pilot Program project selection and project funding in the Lower Basin. Phase 3 Pilot Program projects in the Lower Basin are expected to create 63,322 acre-feet of system conservation in Lake Mead. The entire volume of system conservation for Phase 3 will be in Lake Mead by the end of calendar year 2019.

Pilot System Conservation Program Lower Colorado River Basin Projects – Phase 3
Participant State Water Conservation Method Estimated
Water Conservation (AF)
Total Cost Cost/AF
Bard CA Project fallowed 972.86 acres of farmland from April 15, 2018 through August 15, 2018. 1,747 $411,953.24 $235.811
Project is fallowing 1,983.94 acres of farmland from April 15, 2019 through August 15, 2019 3,571 $866,981.78 $242.78
Colorado River Indian Tribes
MTA Farms
AZ Project is fallowing 1,884.4 acres of farmland from October 1, 2018 through September 30, 2019 10,741 $2,025,730.00 $188.60
Ton 3 Project conserved TON CAP water in Lake Mead in 2018 in lieu of storing the water underground in AZ. 11,050 $2,044,250.00 $185.00
CAWCD 2 AZ Project conserved CAP Excess Agriculture Pool water in Lake Mead in 2018 by reducing delivery of such water to an irrigation district which implemented a combination of deficit irrigation, fallowing, and/or use of local water supplies. 5,042 $693,275.00 $137.50
FMYN AZ Project will conserve FMYN CAP water in Lake Mead in 2019 13,683 $2,599,770.00 $190.00
Colorado River Indian Tribes
Quail Mesa
AZ Project is fallowing 3,705.1 acres of farm land from January 1, 2019 through December 31, 2019. 17,488 $3,497,614.40 $200.00
Total 63,322 $12,139,574.42
Average Cost $191.71
  1. In 2018 and 2019, Bard retained $100/acre of compensation to cover administrative costs. Compensation to farmers for system conservation was $314,667.24 or $180.12/AF in 2018. In 2019, farmers will be compensated $668,587.78 or $187.23/AF.

Summary: Pilot Program in the Lower Basin

The Pilot Program in the Lower Basin is expected to create 175,347 acre-feet of system conservation in Lake Mead by 2035 for a cost of approximately $29.8 million or $170.14 per acre-foot. The Federal/non-federal cost share is 47/53 percent, respectively. By the end of calendar year 2019, 94 percent of the system conservation created by the Pilot Program or 165,618 acre-feet of system conservation are expected to be conserved in Lake Mead.

Although the Pilot Program will be ongoing until 2035, as of 2019, future announcements of funding opportunities and requests for additional Pilot Program project proposals are not being contemplated.

Pilot System Conservation Program Lower Colorado River Basin Projects – Phases 1 Through 3
Time Frame Phases Number of Projects1 System
Conservation (AF)
Total Cost All Projects ($) Average Cost $/AF
2015 through 2019 3 16 175,347 $29,834,323.99 $170.14
  1. Six projects in Phase 1, 4 projects in Phase 2 (Bullhead City project in Phase 2 is an expansion of the original Phase 1 project), and 6 projects in Phase 3.

Quick Links

For more information about this program, contact LCPilotSystemConservation@usbr.gov

Last Updated: 9/11/19