ABSTRACT
This chapter examines the potential of voluntary water trading to reallocate water supply risks associated with climate change effects on regional water supplies, focusing upon the Lower Colorado River Basin of the southwestern United States. In many regions worldwide, increased variability in precipitation, along with shifts from snow to rain are key impacts of climate change. These changes present new challenges for storing and delivering reliable water supplies. We examine the usefulness and potential pitfalls of reliance on seasonal climate forecasts for designing water trading arrangements to buffer an urban area against supply reliability risk.
