Agricultural Economics Department


Date of this Version

November 2006


Supalla, Raymond J., T. Buell and S. Stricker, “Economics of Management Options for Lake McConaughy,” Department of Agricultural Economics Research Report, University of Nebraska – Lincoln (forthcoming). November 29, 2006.


The amount of water stored in Lake McConaughy reached a historical low in the Fall of 2004 and again in 2006. In 2005 and 2006 CNPPID irrigators received less than a full supply of Lake McConaughy water for the first time since the system came on line over 60 years ago. Electric power interests, recreation interests and the regional economy have also been adversely affected by low water levels. What, if anything should the State of Nebraska do to minimize the adverse impacts from this situation and/or prevent it from developing again in the future?

The most critical policy issue concerns the potential effects of diminished water supplies on irrigation, hydropower, recreation resources and the regional economy. The policy choices consist of leaving more water in Lake McConaughy during drought periods, reducing upstream groundwater irrigation, and investments to provide directly for regional economic development. Economists at UNL recently analyzed the effects of Lake McConaughy management options on the different water using groups and on the regional economy (Supalla et al., 2006).