Research > Natural Resources Economics

Economic and policy implications of underground water use in the Southern Ogallala Region

As one of the world’s largest underground freshwater sources, the Ogallala Aquifer encompasses 174,000 square miles and underlies parts of eight states from the Texas panhandle to South Dakota. Groundwater depletion rates vary greatly among these eight states. However, compared to the rate of depletion, the recharge of Ogallala Aquifer is minimal due to low infiltration of surface water and predominantly semiarid environment of the high plains.

Serious implications could occur for the regional economic viability if the current depletion rates continue. As a result, the focus on aquifer irrigation has shifted from economic development and expansion in the 1950s and 1960s to water conservation issues. Policy makers and stakeholders are investing on different water conservation policies to extend the economic life of Ogallala aquifer.

The objective of this project is to investigate the economic impact of policy alternatives on Ogallala water conservation potential.

Sustainable advanced grazing system

The beef cattle industry in the Rolling Plains Region of Texas is inherently risky due to frequent drought conditions, volatile cattle prices and rising input costs. The Beef Cow-Calf Standardized Performance Analysis (SPA) provides an analytical tool to help farmers and ranchers identify their strengths and weaknesses in production and financial performance.

Factors promoting higher herd productivity include machinery investment, pasture-quality improvement and protein supplementation.

Interestingly, the greatest net carbon sequestration was found for the two most technically efficient groups. This finding indicates that pursuing technical efficiency will not compromise environmental quality.

Another study was initiated to evaluate long-term economic consequences of using traditional and multi-paddock grazing in southern tallgrass prairie. The economic evaluations at a whole-ranch level will provide very useful information for ranch managers in choosing strategies that will fulfill both economic and resource conservation goals.

Integrated cropping systems

This project focuses on the adoption of management practices to adapt to climate-induced changes in the High Plains and Rolling Plains for cropland and rangeland.

Specific budgets for various dryland and irrigated cropland systems are being developed and used for the following:

• to determine economical and effective management practices
• to improve productivity, income, and water quality
• to conserve water quantity in the region.

This project also encompasses economic analysis of cropping systems and grazing in wheat and rangeland management options, as well as conventional and conservation tillage systems. In addition, using the soil profile data, we will analyze the long-term cost/benefit analysis of soil carbon sequestration under different cropping systems that use simulation approaches and long-term field data.

Bioenergy production from rangeland woody biomass

This project incorporates economic analysis of regional bioenergy production systems; rangeland biomass supply, energy production, and economic and greenhouse gas (GHG) efficiency.

For the rangeland biomass supply, the total cost of delivered mesquite biomass was found to be $51.26 per Mg after harvest costs, storage costs, and land rents were accounted. Approximately, 87% of the estimated total cost is for harvesting, about 11% for transport, and 1% for the land rent.

Simulation also showed that higher and more spatially consistent biomass density would be an important factor in selecting a potential location for a bioelectricity plant.

The project also examined the economic feasibility of mesquite biomass as a potential bioenergy feedstock for electricity production. We analyzed five mesquite biomass accumulation scenarios, which take into account variations in rates of standing biomass accumulation and tree density re-establishment after harvest with the above-ground (AG) only harvest options or the whole-plant (WP) harvest option.

Results indicated that mesquite biomass has economic potential to be a source for electricity generation. A long-term bioenergy harvest system with regrowth following AG harvest was found to be much more cost-effective than re-establishment from germination of new seedlings after WP harvest, even though harvest cost is higher.

Compared to conventional coal, mesquite biomass was found to be a more expensive energy source for electricity production, but a possible carbon emission tax would make mesquite biomass competitive with conventional coal. In a recent study, honey mesquite was compared to other energy feedstocks for economic and greenhouse gas (GHG) efficiency. Biomass production cost, energy cost, GHG offset and GHG emissions were calculated