California Big Agriculture's $100 Million Energy Subsidy

[courtesy of California Progress Report]

California and U.S. Taxpayers Foot Electricity Bills for Central Valley Agribusinesses

By Bill Walker
West Coast Director
Environmental Working Group

Some of America's richest and largest farms are paying pennies for the vast amounts of electricity needed to deliver irrigation water to California's arid Central Valley.

In 2002 and 2003, agribusinesses in the Central Valley Project (CVP) paid only about one cent per kilowatt-hour for electricity to transport irrigation water, according to a 15-month investigation by Environmental Working Group (EWG). Compared to Pacific Gas & Electric's agricultural rate, that's an annual subsidy of more than $100 million from the rest of us.

EWG's report is available at www.ewg.org. It shows both the price paid by each CVP irrigation district in the years studied and the amount of energy the district used.

Every year the CVP, the nation's largest federally subsidized irrigation system, moves more than 2 trillion gallons of water through 1,500 miles of canals. The electricity needed to move water around the CVP would power every home in Chico for 18 months. But just as CVP contractors pay heavily subsidized rates for their water, they pay next to nothing for the power that delivers it.

Through the federal Freedom of Information Act, EWG obtained U.S. Bureau of Reclamation documents that enabled us to calculate, for the first time, the rate paid by CVP agribusinesses and the value of their power subsidy. We found: