The conversion of coal into other types of fuel through gasification and liquefaction has been proposed as a means of coping with America's increasing energy needs. Coal conversion plants require large quantities of water for cooling purposes and for use as a raw material.
There are three types of water allocation presently used in the United States, riparianism, prior appropriation, and administrative permit systems. The common law riparian system is undesirable because under it water rights are insecure and subject to locational use restrictions. Prior appropriation is better, but the permanent water right created under this system results in excessive rigidity. A system of administrative regulation by means of a consumptive use permit system offers the best allocation framework for both coal conversion facilities and other water users as well.
Kentucky presently has such a system of administrative allocation. However, this legislation could be improved by (1) clarifying the planning functions of the Department for Natural Resources and Environmental Protection and the Water Resources Authority; (2) expanding the scope of the consumptive use permit system by removing most of the exempted use categories; (3) adopting beneficial use as the basis upon which consumptive use permits will be granted; (4) imposing a durational limit on water use permits and delineating renewal procedures; (5) adopting a scheme for both voluntary and involuntary transfers of water rights; and (6) specifying more explicit provision for dealing with temporary water shortages.
Finally, it should be noted that the federal government has an important role with respect to navigation, water resources development, and water pollution control. Federal powers in these areas may impose some constraints on state allocation policies, although major conflicts can be avoided if proper coordination among state and federal officials is maintained.
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The work on which this report is based was supported in part by funds provided by the Office of Water Research and Technology, United States Department of the Interior, as authorized under the Water Resources Research Act of 1964.
Ausness, Richard C.; Callahan, Gary W.; Dills, Steven W.; Flynn, Bill H.; and Gillig, John S., "Legal Institutions for the Allocation of Water and Their Impact on Coal Conversion Operations in Kentucky" (1976). KWRRI Research Reports. 105.