Effects of climatic change on a water dependent regional economy: A study of the Texas Edwards Aquifer

Global climate change portends shifts in water demand and availability which may damage or cause intersectoral water reallocation in water short regions. This study investigates effects of climatic change on regional water demand and supply as well as the economy in the San Antonio Texas Edwards Aquifer region. This is done using a regional model which portrays both hydrological and economic activities. The overall results indicate that changes in climatic conditions reduce water resource availability and increase water demand. Specifically, a regional welfare loss of $2.2-$6.8 million per year may occur as a result of climatic change. Additionally, if springflows are to be maintained at the currently desired level to protect endangered species, pumping must be reduced by 9-20% at an additional cost of $0.5 to $2 million per year.