At the 2023 United Nations Climate Change Conference in Dubai this week, Gov. Michelle Lujan Grisham announced a first-of-its-kind strategic water supply plan to increase drought resilience and advance clean energy production and storage.
“In arid states like ours, every drop counts. A warming climate throws that fact into sharper relief every day,” said Gov. Lujan Grisham. “We’re leveraging the private sector to strengthen our climate resiliency and protect our precious freshwater resources.”
Global warming and aridification are exacerbating water shortages throughout the Southwestern United States. Consequently, some of our reservoirs and groundwater supplies are critically low and not recharging at sufficient rates to ensure future water security. In Albuquerque, the Rio Grande went dry for the first time in four decades in August 2022. Such events illustrate how current water supplies are not matched for future demand, where climate models predict up to a 25% reduction in available water across the state.
The governor made the announcement at a U.S. Chamber of Commerce event at the conference.
The plan calls for New Mexico to purchase treated brackish and treated produced water to build the strategic water supply. In early 2024, the New Mexico Environment Department will issue guidance and seek proposals from companies interested in pursuing a contract. This contracting model, used in other industries like healthcare for manufacturing vaccines, is known as an advanced market commitment. Advanced market commitments reduce the risk of private sector investment and spur first movers to build otherwise costly infrastructure.
Companies that are awarded an advanced market commitment contract can secure private capital to build and operate water treatment facilities with the assurance that the state will purchase the water. Then, the state will make the water available for creating green hydrogen; storing energy produced by wind and solar; manufacturing electric vehicles, microchips, solar panels, and wind turbines; and other uses as treatment and demand allow.
New Mexico sits on top of substantial aquifers of brackish salt water, which cannot be used for human or agricultural consumption without treatment. Brackish water supplies are separate from freshwater resources underground. Estimates indicate there may be between two and four billion acre-feet of brackish water underneath the state. A 25 million gallon per day brackish water treatment plant could produce up to 27,900 acre-feet of potable water a year. For comparison, this would cover approximately 40,000 acre-feet.
In addition, over 2 billion barrels of produced water were generated by oil and gas operations in 2022, of which 1.2 billion barrels were simply injected into deep wells for permanent disposal in New Mexico. Diverting just 3% of the produced water disposed of in injection wells to make hydrogen could result in enough energy to fully power over 2 million homes annually.
So what’s the cost?
The governor says she is looking for $500 million in non-general fund dollars. The ask would be split with $250 million to be appropriated in the upcoming legislative session and $250 million in the 2025 legislative session. This funding is secured through revenues from severance taxes collected on oil, gas, and other natural resources that are “severed” from the ground.
Strategically locating brackish and produced water treatment facilities around the state can offset demand for freshwater. In the future, the development of science-based regulatory standards may allow for expanded uses of treated water from the strategic water supply.
“The Governor’s initiative appropriately recognizes the important nexus between water challenges and clean energy production, especially in arid parts of the world,” said Marty Durbin, U.S. Chamber of Commerce Senior Vice President of Policy.
The New Mexico Environment Department recently requested public comments on proposed water reuse rules. Once finalized, the water reuse rules will create a consistent and science-based permitting program to attract more investment in water reuse. All treated water must comply with New Mexico Environment Department regulations and permitting requirements.
“While New Mexico is doing everything we can to reduce climate warming emissions, it is equally important to focus on water resiliency,” said New Mexico Environment Secretary James Kenney. “Water reuse safeguards freshwater for communities while offering opportunities for clean energy expansion and green manufacturing.”
The New Mexico Environment Department will provide a detailed roadmap for companies to express interest in pursuing an advanced market commitment contract with the State of New Mexico after the legislative session concludes in February 2024. Interested businesses should sign up here to receive information on the project.