Pay-as-Bid Vs. Pay-as-Clear: Complex RTO Payment Methods for Power Markets Not Fair or Necessary, According to Op-Ed: (The Solution May Be Tweaks Rather Than a Switch IMO)

       There has been significant criticism of the Regional Transmission Organization (RTO) power market manager, PJM Interconnection, for raising prices at its annual capacity auction. In PJM’s 2024 auction, capacity prices rose to $269.92/MW-day, a tenfold jump from $28.92/MW-day in 2023.

     According to Frank Lasse of Truth in Energy and Climate, a group of climate skeptics and realists, argues that the pay-as-clear method of determining forward power prices is absurd and illogical, as well as unfair and unnecessary. He and others have argued that there is a better way, known simply as pay-as-bid. He claims that growing demand from data centers and the premature shutdown of reliable coal and gas plants are the main reasons for the potential power reserve capacity inadequacies looming on the horizon. He blames the low cost of renewables, which can easily outbid fossil resources due to the absence of fuel costs, although upfront costs are much higher for renewables. That problem increased with increased renewables deployment due to the Inflation Reduction Act, which will not be the case going forward due to repeals. Solar and wind deployment will also drop when subsidies are dropped in 2026. Those natural gas and coal resources are still needed for backup, daily spikes, and seasonal spikes, so making them uncompetitive, less profitable, and prematurely retiring them is not in the best interests of power grid reliability. The Trump administration has ordered a few planned coal plant retirements to be delayed but it is unclear if those actions were really needed. At the request of PJM, the DOE recently issued an emergency order to allow a 400MW oil-fired unit at a Baltimore power plant beyond its operational limits. The unit can only run a certain number of hours per year due to air pollution concerns, and PJM expects to keep it within those limits. The planned retirement has been delayed by up to four years to 2029.

     Lasse notes that the current rules prioritize intermittent electricity and unnecessarily disadvantage on-demand energy, mainly natural gas. The rules allow them to take away market share from the “reliables,” he argues.

“California, the green poster child, pays 31.23 cents per kWh, nearly double the national average of 16.88 cents (EIA, May 2025). Switching to a pay-as-bid system, where each generator gets their actual bid price and stop adding wind and solar, will stop this insanity and save ratepayers a bundle.”

     The problem with his solution is that we are not going to stop adding wind and solar, since they are desirable for reducing emissions. We can, however, slow the additions of wind and solar to achieve better overall integration of them into the grid. Power markets should be sensitive to the needs of needed gas generators in light of the advantages given to wind and solar. One might say we need some incentives for renewables, but not at the expense of needed reliable generation. Perhaps a solution that shares benefits on agreeable terms.  

     Lasse argues that a pay-as-bid mechanism would induce competition and lower power prices for consumers.

“It’s time RTOs like PJM and MISO ditched this pay-as-clear racket. FERC should greenlight a shift to pay-as-bid, forcing generators to compete on real costs, not game the system. Let’s stop overpaying for power and prioritize affordability and reliability.”     

     I am not sure which would be best, but needed reliable power production should not be disadvantaged and made to be unprofitable, while highly subsidized intermittent power is advantaged. While there are mechanisms to pay reliable energy generators for retaining reserve capacity, these can be inadequate. In particular, I believe that the most efficient combined-cycle natural gas plants should be running close to maximum capacity factors, as that is the cheapest form of widely available, reliable energy.   

      In a pay-as-bid system, a reliable power generator may win a bid at a higher rate than an unreliable power generator. Thus, they could win back some market share from subsidy-propped renewables. Both will be paid as bid. Thus, the reliable energy provider can be valued higher for providing reliable power. In a pay-as-clear system, all are paid the highest bid. Thus, in such a system, the unreliable provider is paid the same as the reliable provider. In a pay-as-bid system, the unreliable provider would be paid less.

“In economic terms that is they get paid the marginal clearing price in the market.”

     Thus, along with getting subsidized, unreliable energy sources are getting paid at reliable energy sources' prices.

 

Pay-As-Clear

     According to Flex Pwr:

“Pay-as-Clear is a pricing mechanism commonly used for auctions of homogeneous goods, such as commodities, shares (e.g., emissions), or electricity. In this process, a uniform price applies to all buyers and sellers at the conclusion of the auction, regardless of the bids they initially submitted or accepted. This is why it's also referred to as uniform pricing.”

“The price is determined by accepting bids until supply and demand are identical, i.e. the market is cleared. In practice, bids are usually accepted until a set quantity of the good has been auctioned off. In sales auctions, the highest price accepted then applies; while in purchase or procurement auctions, the lowest price awarded applies.”

 

Pay-As-Bid

     Again, according to Flex Pwr:

“In Pay-as-Bid auctions, each buyer and seller is paid the price they specified in their successful bid. This means that prices below the highest bid are possible at sales auctions - at least in theory - and prices above the lowest bid at purchase or procurement auctions.”

     Pay-as-Clear is usually considered to lead to more volatile pricing and higher prices for consumers, but pay-as-bid could also produce price volatility. An argument against pay-as-bid is that it would cannibalize renewables by making them less profitable. Pay-as-clear seems to solve this by instead making reliable energy less profitable. I am thinking some sort of combination approach would be best, more toward ‘splitting the difference.’ It has been argued that pay-as-bid would not lower consumer costs but raise them in the medium to long term. Others have argued that due to marginal pricing, both setups would result in similar consumer costs. Due to the guessing of clearing prices, the pay-as-bid method is prone to misallocation. Higher transaction costs mean that less capital will be available for efficiency improvements, preventing lower prices for consumers.  

     As can be seen below in a comparison of both systems, there are some important pros of pay-as-clear that should be considered and some important cons of pay-as-bid that should be considered. Thus, I would say that changing from ‘clear’ to ‘bid’ is not warranted. However, I also believe that while renewables should have some propping, they should not be able to cut into the profits of reliable energy generators. Perhaps renewables could be paid not the highest bid price as in pay-to-clear and not the bid price as in pay-as-bid, but somewhere in between.  

     According to a 2025 mathematical analysis done by the Computer Science Department at Aarhus University in Denmark, the pay-as-bid system will always result in lower consumer prices. They don’t seem to take into account the effect on efficiency investments.

Abstract. The design of energy markets is a subject of ongoing debate, particularly concerning the choice between the widely adopted Pay-as-Clear (PC) pricing mechanism and the alternative Pay-as-Bid (PB). These mechanisms determine how energy producers are compensated: under PC, all selected producers are paid the market-clearing price (i.e., the highest accepted bid), while under PB, each selected producer is paid their own submitted bid. The overarching objective is to meet the total demand for energy at minimal cost in the presence of strategic behavior. We present two key theoretical results. First, no mechanism can uniformly dominate PC or PB. This means that for any mechanism M, there exists a market configuration and a mixed-strategy Nash equilibrium of PC (respectively for PB) that yields strictly lower total energy costs than under M. Second, in terms of worst-case equilibrium outcomes, PB consistently outperforms PC: across all market instances, the highest possible equilibrium price under PB is strictly lower than that under PC. This suggests a structural robustness of PB to strategic manipulation. These theoretical insights are further supported by extensive simulations based on no-regret learning dynamics, which consistently yield lower average market prices in several energy market settings.

     They also note in their conclusion:

“Our experimental evaluations support our theoretical findings, indicating that online learning dynamics consistently lead to lower average unit prices under PB compared to PC. An intriguing direction for future research is to derive formal price guarantees for both PB and PC under the assumption that all producers employ no-regret online learning algorithms to determine their bids.”

     I believe that tweaks in the formula for determining capacity auction pricing should take into account the financial concerns of both renewable and reliable energy producers, since we need both. In practice, I think that would likely involve advantaging renewables a little less and advantaging reliables a little more.

  

 

 

References:

 

Op-Ed: Pay-as-bid: A smarter way to power the grid without getting fleeced. Opinion by Frank Lasee.  Truth in Energy and Climate. The Center Square. July 28, 2025. Op-Ed: Pay-as-bid: A smarter way to power the grid without getting fleeced

Pay-as-Clear vs. Pay-as-Bid in Power Trading. Flex Pwr. Pay-as-Clear vs. Pay-as-Bid in Power Trading | Definition

Rethinking Pricing in Energy Markets: Pay-as-Bid vs Pay-as-Clear. Ioannis Caragiannis, Zhile Jiang, and Stratis Skoulakis. Department of Computer Science, Aarhus University, Denmark. July 8, 2025. Rethinking Pricing in Energy Markets: Pay-as-Bid vs Pay-as-Clear

“Pay as Bid” and “Pay as Clear”. Transition. Blog. “Pay as Bid” and “Pay as Clear” | SSEN Transition

UK Firms Energy Cloud, YES Energy Solutions, and Amazon Address Energy Poverty by Providing Free Hot Water Generated from Surplus Wind Power

    According to the UK government’s 2023 data, there are 3.17 million households in the country facing energy poverty. The high cost of energy and the costs of living are important factors. According to national statistics:

“Between 2022 and 2023 gas & electricity prices rose by 19 per cent in real terms. The Energy Price Guarantee capped gas & electricity prices for a standard dual fuel consumer to £2,500 between October 2022 and June 2023. While prices fell later in 2023, they remained higher than at the start of 2022. The Energy Bill Support Scheme gave all households a rebate of £400 in winter 2022/23. After considering energy rebates, energy efficiency and household changes the overall required energy costs increased by 27 per cent between 2022 and 2023 in real terms. The change in energy prices after government support is estimated to have increased fuel poverty by around 238,000 households over this period if no other factors had changed.”

     The price spikes were largely a result of the Russian invasion of Ukraine, but before that, they had already spiked up to record levels.

     A new collaborative program by non-profit Energy Cloud, community interest company Yes Solutions, and Amazon is seeking to help address energy poverty by providing free hot water. They plan to do this by heating the water heaters of those in need with curtailed renewable energy when demand is low due to overgeneration. The program combines cloud computing, renewable energy, and technology to provide the service.

     According to Energy Cloud, in 2024, 5.7 terawatt-hours of surplus wind energy generated in England, Scotland, and Wales were wasted. That wasted power was worth over $1.3 billion. Meanwhile, about 13% of British residents have trouble meeting home energy costs. Energy Cloud noted that a previous similar water heating program in Ireland in collaboration with Amazon, resulted in participants getting free hot water for about one-third of the year.

     Curtailed renewables are being utilized for many processes around the world, including for mining cryptocurrencies, for generating heat for industrial applications, for powering electrolyzers to make green hydrogen, and for charging batteries and other kinds of energy storage.

"This is an exciting and forward-thinking project that brings real-world benefits to the households who need it most," said the CEO of YES Energy Solutions, Duncan McCombie. "By working with EnergyCloud and Amazon, we're not only tackling energy inefficiency and fuel poverty, but also helping to maximise the environmental potential of the UK's renewable energy infrastructure. It's a triple win – for families, for the environment, and for our shared energy future."

     Energy Cloud specializes in projects to tap curtailed renewables to address energy poverty. The pilot project in England will begin this year. Participating homes are to be equipped with an EnergyCloud-enabled smart device managed by YES Solutions and Amazon. The goal for Energy Cloud is to connect those in need with surplus energy, while lowering carbon emissions, pollution, and furthering cloud-based IOT smart device technology. The process can be considered to be another case of capturing waste streams, in this case, as waste renewable energy recovery, much like the waste industrial heat recovery that is also being pursued. 

     David Nicholl, Chairperson of EnergyCloud England, noted that the process of redirecting curtailed renewables to heat water heaters is minimally invasive. It involves mainly the installation of the smart devices. All energy flows can be switched on and off with software and sensors according to time, power availability, or programmed to respond to demand changes. He also noted the advantage that impacts on power bills are immediate. However, with the free water only available for one-third of the year, the positive impacts are limited. Such a solution could potentially work better where there is both curtailed wind and curtailed solar with different peak generation times.  

     Smart meter rollouts have enabled the IOT revolution for home and business energy management. This enables the generation of large amounts of data that can be analyzed and acted upon to improve operational efficiencies. Real-time interactive dashboards can allow homeowners and business owners to make decisions as well.

     Below is an IOT-based power management architecture diagram by Amazon Web Services (AWS):                                                                                                                                                                          

                                                                   

·        Scalable and secure high-velocity data ingestion

·        Scalable and real-time situational awareness serverless dashboard

·        Hydration and curation of IoT data lake

·        BI reporting

·        Alarm management

     

 

References:

 

Amazon confirms partnership to tackle energy poverty in England. Emily Whitehouse. Newstart Magazine. June 23, 2025. Amazon confirms partnership to tackle energy poverty in England – NewStartMag

Amazon joins innovative partnership to launch first-of-its-kind energy project: 'It's a triple win'. Simon Sage. The Cool Down. July 27, 2025. Amazon joins innovative partnership to launch first-of-its-kind energy project: 'It's a triple win'

Annual Fuel Poverty Statistics in England, 2024 (2023 data). 15 February 2024. National Statistics. Annual fuel poverty statistics in England, 2024 (2023 data)

EnergyCloud Collaborates with Amazon to Launch New Renewable Energy Initiative in England. Energy Cloud England. Contact | EnergyCloud England

Submission to Fuel Poverty Strategy England: Using Surplus Renewable Energy to Tackle Fuel Poverty. “How we can use surplus renewable energy to tackle fuel poverty in England”. Energy Cloud England. Contact | EnergyCloud England

Real-time operational monitoring of renewable energy assets with AWS IoT. Avneet Singh and Joseph. Amazon Web Services. October 1, 2020. Real-time operational monitoring of renewable energy assets with AWS IoT | AWS for Industries

Trifluoroacetic Acid Rain: A Milder PFAS-Like Concern as Environmental Concentrations Grow

      Trifluoroacetic acid (TFA) is now found all over the world. It is present in lakes, rivers, bottled water, beverages, food, and in animal and human livers, blood, and urine. Nature reports that:

“Over the past four decades, TFA levels have risen five- to ten-fold in the leaves and needles of tree species in Germany. Researchers have also documented rising levels of TFA in Canadian Arctic ice cores4 and in groundwater in Denmark.”

     TFA has strong carbon-fluorine bonds that are hard for natural processes to break down. That is why it is sometimes classed as a PFAS “forever chemical.” If classified as a PFAS, it would be the smallest molecule of them, and luckily, it is considered magnitudes less harmful than other PFAS chemicals.

     Whether it will ultimately be harmful or not depends on a better understanding of its health impacts and whether its concentration continues to grow. Nature notes that:

“…in June 2024, two German federal agencies petitioned the European Chemicals Agency (ECHA) to label TFA as a reproductive toxin and a very persistent and very mobile substance. The ECHA has opened this petition for public comment, which closes on 25 July.”

     However, other regulatory agencies do not consider TFA to be a PFAS and are not as concerned with its increasing presence in the environment.

“But other scientists say that TFA shouldn’t be counted in the definition of PFASs, partly because it doesn’t build up in humans and animals as other PFASs do. The US Environmental Protection Agency, for instance, doesn’t currently consider TFA to be a PFAS.”

     TFA is produced as a byproduct in the refrigeration, agrochemical, and pharmaceutical sectors. They typically use TFA as an ingredient to make larger fluorine-containing molecules, and it can escape from industrial facilities. Other chemicals can break down to form TFA, acting as precursors, but these do not occur in the rain.

“The TFA in rain comes from different sources — mainly some fluorinated gases (F-gases), including those used as refrigerants and in building insulation. These gases leak from air-conditioner units and insulation foam, mostly when products are in use or being discarded.”

     Since there was more TFA calculated to be present than could be produced from industry and chemical breakdowns, research began to explore whether it existed in nature. Some researchers think that TF is a naturally occurring salt in the oceans, but others disagree. Levels of TFA in ice cores have risen sharply since the 1980s.

“David O’Hagan, a fluorine chemist at the University of St Andrews, UK, who studies naturally occurring fluorinated compounds, says that he remains “truly unsure” about whether TFA could occur naturally. A few microorganisms do make fluorinated molecules, but because these have only one fluorine atom — not three — O’Hagan doesn’t think microbial processes would create TFA. Scientists have yet to identify possible geological mechanisms, he adds.”

“In the 1990s, AFEAS researchers concluded that TFA is not acutely toxic, by referring to earlier studies that had fed or injected TFA into mice and rats7. Huge quantities were needed to kill the animals, and by that metric, TFA was found to be “about as toxic as table salt”, says Thomas Cahill, an environmental toxicologist at Arizona State University in Tempe.”

     Some animal studies have shown that TFA could have significant reproductive toxicity, but those experiments utilized levels of TFA hundreds of thousands of times more concentrated than levels found in drinking water.

“In 1976, to check whether TFA is a harmful metabolite of the anaesthetic halothane, researchers injected two volunteers with TFA, and recovered all of it in urine within three days. Many scientists think that TFA does not build up in organs and tissues, but instead behaves like a salt.”

     Since TFA does not bioaccumulate like PFAS and since it has not been found to be toxic at current concentrations, I would argue that it is not a chemical of great concern.

 

 

     

References:

 

There’s a new acid in our rain — should we be worried? Scientists and regulators are divided over the threat posed by rising levels of a chemical called TFA. XiaoZhi Lim. Nature. July 23, 2025. There’s a new acid in our rain — should we be worried?

Evapotranspiration Increases Humidity, Making Heat Waves Slightly Worse: But ‘Corn Sweating’ is a Misnomer Since It is a Minor Contributor

     The phenomenon of ‘corn sweating’, increasing humidity in June and July in the Northern Hemisphere, is well-known. The process is simply plant transpiration or evapotranspiration (ET). One might think of it as plants breathing, except they expire oxygen. This is how plants absorb nutrients and other substances as well. According to an article in Ag Daily, the process is as follows:

The process happens in three main steps:

1) Plants absorb water from the soil through their roots.

2) Water is transported through plant tissues, where it plays a role in metabolic and physiological processes.

3) Leaves release water vapor into the air through their stomata.

     Evapotranspiration is a vital part of the Earth’s hydrological cycle. It involves the movement of water from plants to the atmosphere through the processes of transpiration and evaporation. It is estimated that 60-75% of land precipitation is returned to the atmosphere via evapotranspiration. Three factors influence ET rates: available moisture, heat energy, and humidity (ability of the atmosphere to take up water).

     The corn and other plants are not exactly sweating, but the added atmospheric moisture makes us sweat more. Evapotranspiration is similar to sweating in that the plants release vapor through their stomata, like humans excrete liquid water through their pores.

     All plants and grasses transpire. Corn is actually a minor contributor overall. Among farm crops, soybeans are also a contributor. The main influence on summer humidity in the Midwest is warm, moist air coming from the Gulf of Mexico and other waterways. Some research suggests that soybeans contribute more than corn. Thus, the term ‘corn sweating’ is more of a misnomer. Corn farmers are not the main cause of humidity increases, as seemingly suggested in some articles.

     Satellite remote sensing is often used to estimate evapotranspiration rates. Plant sweating usually indicates healthy plants since it reflects water availability. When there is drought, the stomata close up somewhat to preserve water, which also can stunt growth. Thus, plant sweating should be seen as a good thing. One direct way to measure evapotranspiration is via a pan lysimeter, as shown below. There are other indirect ways to measure it through water and energy balance equations, and often satellite-based remote sensing models.

     In places where a lot of corn and soybeans are grown, such as Iowa, where 24 million acres of corn and soybeans are grown, they are larger contributors.

     An article in National Geographic notes that evapotranspiration rates are affected by the amount of plant cover and are influenced by deforestation and reforestation. Vegetation is more dense in forests. Thus, ET can change over time in an area. As forests continue to grow in places like North America, the overall rates of evapotranspiration increase.

References:

 

‘Corn sweat’—and other weird weather phenomena—explained. The Midwest’s massive corn fields are making the region more humid as it battles a sweltering heatwave. Kieran Mulvaney. National Geographic. July 23, 2025. ‘Corn sweat’—and other weird weather phenomena—explained | National Geographic

What is corn sweat? Understanding healthy plants and humidity. Braeden Coon. Ag Daily. June 21, 2023. What is corn sweat? Understanding healthy plants, humidity | AGDAILY

Evapotranspiration. Wikipedia. Evapotranspiration - Wikipedia

LanzaTech’s LanzaX Spinoff: A Public Gas Fermentation Carbon Utilization Company Moving into Synthetic Biology, but Not Yet Profitable

    LanzaTech is involved in a process utilizing microbes to turn CO2 into specialty chemicals. They have been around for a few decades and are continuing to branch out. According to Trellis:

“The new company, LanzaX, will take over a pipeline of existing LanzaTech projects focused on refining isopropanol, used in household products, medicines and cosmetics; and acetone, a solvent used in nail polish and paint removers. It will also focus on LanzaTech’s emerging gas fermentation technology, which can turn carbon monoxide or dioxide directly into chemicals.”

     LanzaTech is headed by CEO Jennifer Holmgren, a chemist and author of many patents.

“The company went public in February 2023 via a special purpose acquisition company in a deal valued at $2 billion, or $10 per share. Its stock trended downward throughout 2024, recently sinking below $1 per share.”

     The spinoff of LanzaX allows the company to focus on biorefining to produce ethanol. They have plants in Belgium, China, India, and the US. State of Georgia. LanzaX is basically a synthetic biology company.

     Mukunda Kaushik, a Lux Research analyst for carbon capture and utilization, noted:

“LanzaTech has taken this to the scale we need. Synbio has challenges, but the potential is that it can produce a wide range of chemicals.”

     LanzaTech’s first spinoff was LanzaJet, which makes sustainable aviation fuel (SAF). LanzaX’s synthetic biology technology is still in the later stages of R&D and is now seeking profitability.

     LanzaX will specialize in the design, development, optimization, and validation of gas fermentation strains utilizing their bioreactors. They utilize C1 microbes that consume methane, known as methanotrophs, or that consume other C1 compounds such as methanol, carbon monoxide (CO), and CO2, known as methylotrophs.

     An article in Science Trends considers the challenges of commercializing C1 microbes:

“While C1 microbes present attractive biotechnological platforms, many challenges exist that, so far, limit their broad use on a commercial scale. A reverse approach, of engineering the well-developed commercial platforms (E. coli, yeast) to consume C1 compounds has also been challenging. However, the outlook is bright for both approaches, as we now possess tools and technologies (genomics, computation) to push the technical boundaries of these limitations.”

     A 2018 paper in Current Opinion of Biotechnology summarizes the potential applications of methylotrophs, as seen in the paper’s highlights and graphical abstract below.

     Lanza Tech has been struggling in the marketplace, which is one reason for the spinoff. In fact, they could face bankruptcy. They were approached by an investor, Carbon Direct Capital Management, for a takeover offer that was considered to be a lowball offer. Another synthetic biology company, Danimer Scientific, which makes the biobased polymer polyhydroxyalkanoate and also went public through a SPAC, declared bankruptcy in March 2025. The profitability of carbon management companies is currently very difficult to secure without significant subsidization, and often even with that subsidization. Paths to commercialization remain challenging.  

     According to Lux Research, the global carbon utilization market value could reach $70 billion by 2030 and could increase to $550 billion by 2040. As shown in the graphs below, chemicals are one of the main product paths for utilizing carbon and CO2-to-chemicals. However, costs are still too high for successful commercialization in this sphere due mainly to the energy intensity of the processes. Lux analyzes the carbon utilization economy and carbon utilization chemicals in the last two graphics.  

     It remains to be seen whether Lanza Tech and its spinoffs, Lanza Jet and LanzaX, will be successful in the marketplace.

     

 

 

References:

 

Carbon recycling firm LanzaTech is spinning out synthetic biology tech. Heather Clancy. Trellis.  February 12, 2025. Carbon recycling firm LanzaTech spins up synthetic biology venture

LanzaX: Dedicated Strain Innovation Accelerating the path to scale and commercialization of globally sought-after synthetic biology strains. PowerPoint Presentation

C1 Microbes And Biotechnological Applications. Science Contributor. Science Trends. C1 Microbes And Biotechnological Applications - Science Trends

LanzaTech gets lowball takeover offer: Potential buyer says that purchase would be an alternative to bankruptcy. Alexander Tullo. Chemical and Engineering News. April 10, 2025. LanzaTech gets lowball takeover offer

CO₂ Utilization: The Evolution of the Carbon Economy. Arij van Berkel, Yuan-Sheng Yu, Runeel Daliah, Cecilia Gee, Mukunda Kaushik and Oscar Gáme. Lux Research. Co2 Utilization The Evolution of the Carbon Economy - eBook 10.24.23.pdf

Applications of methylotrophs: can single carbon be harnessed for biotechnology? Ludmila Chistoserdova. Current Opinion in Biotechnology. Volume 50, April 2018, Pages 189-194. Applications of methylotrophs: can single carbon be harnessed for biotechnology? - ScienceDirect

Groundwater Depletion and Its Effects: Subsidence, Sea Level Rise, Continental Drying, and Supply Disruptions: New Study Quantifies and Documents Growing Problem

     In most cases, water issues are local or regional. The same is generally true of groundwater depletion and overproduction. Groundwater resources are distributed according to geology and vary considerably by geographic region. The new paper in Science Advances is a global study that highlights some potential global effects of groundwater depletion, such as its surprisingly large contribution to sea level rise. Environmentalists have long portrayed overuse of groundwater resources as potentially catastrophic. It certainly can be in certain places. While probably not as catastrophic as depicted by environmentalists, groundwater depletion is a problem that tends to increase over time since the rate of discharge is much greater than the rate of recharge. One thing that could further decrease recharge rates is soil moisture loss, which is also well-documented. The causes of soil moisture loss, which I wrote about in May 2025, are mainly atmospheric, changes in evapotranspiration, and precipitation. However, without adequate soil moisture, there is less water to recharge aquifers.  

     A long piece by ProPublica about the study describes the main issue of concern:

“… {the study} concludes not only that Earth is suffering a pandemic of “continental drying” in lower latitudes, but that it is the uninhibited pumping of groundwater by farmers, cities and corporations around the world that now accounts for 68% of the total loss of fresh water in those areas…”

     The study, by researchers at Arizona State University, examines 22 years of observational data from NASA’s Gravity Recovery and Climate Experiment, or GRACE, satellites, which measure changes in the mass of the Earth and have been applied to estimate its water content.

     Some of the startling conclusions from the paper include that the continental drying exceeded the rates of glacier and ice sheet melting, which means more water for sea level rise is coming from groundwater, evaporation, and changes in precipitation patterns than from melting glaciers. While global warming may be triggering and exacerbating these issues, it is not the direct cause. If groundwater depletion (via pumping and soil moisture loss) is a bigger cause of sea level rise than glacier melting, then the effects of temperature on glacier melting may have been overestimated. The tipping point for continental drying exceeding glacier and ice sheet melt was around 2014-2015, according to the study. The authors had done previous work on terrestrial water storage (TWS). They have termed global TWS reductions as “continental drying.”

     As noted in the abstract below, “dry areas are now drying faster than wet areas are wetting.” This is creating what they are calling “mega-drying” regions that continue to expand at an alarming rate.

     The authors note that as surface water resources are depleted, there is more production of groundwater resources. As shallower groundwater aquifers are depleted, deeper ones are tapped. Citing several sources, they note that the problem is:

“…exacerbated by global shortcomings in groundwater management and which amplifies rates of TWS loss through a positive feedback. The consequences of global groundwater depletion include reduced irrigation water supply and threats to agricultural productivity, reduced capacity for climate adaptation, drought resilience and for growth in desert cities, reduced biodiversity (24) and damage to groundwater dependent ecosystems, decreasing access as water tables fall, and many others.”

     They note that about 75% of the global population lives in the 101 countries that have been losing freshwater since 2002. Southwestern North America, Central America, Alaska, the Canadian Archipelago, and Patagonia, much of the Middle East/North Africa/Pan-Eurasia, high-latitude Canada, and northern Eurasia are among the new mega-drying regions.

     More geospatial data and comparisons of wetting and drying from the paper are shown below.

     A 2021 study in the journal Science suggested that 6-20% of groundwater wells globally are at risk of depletion, as noted in the abstract below

“Groundwater wells supply water to billions of people, but they can run dry when water tables decline. Here, we analyzed construction records for similar to 39 million globally distributed wells. We show that 6 to 20% of wells are no more than 5 meters deeper than the water table, implying that millions of wells are at risk of running dry if groundwater levels decline by only a few meters. Further, newer wells are not being constructed deeper than older wells in some of the places experiencing significant groundwater level declines, suggesting that newer wells are at least as likely to run dry as older wells if groundwater levels continue to decline. Poor water quality in deep aquifers and the high costs of well construction limit the effectiveness of tapping deep groundwater to stave off the loss of access to water as wells run dry.”

     The abstract of another 2021 paper about groundwater depletion by one of the authors of the current paper explains the problem, based on the previous 2021 paper by Jasechko and Perrone, noted above.

     Long-term trends in TWS by country are shown below.

     The authors calculate that 68% of TWS reduction is attributable to groundwater depletion. Surface water depletion makes up 18%, soil moisture loss makes up 9%, and snow water equivalent makes up 5%. Thus, the TWS reduction problem is mostly a groundwater depletion issue.

     Below are the estimated contributions of TWS loss to sea level rise.

Source: ProPublica

     The authors note that better groundwater management is imperative if we are to preserve these precious resources:

“Key management decisions and new policies, especially toward regional and national groundwater sustainability, and international efforts, toward global groundwater sustainability, can help preserve this precious resource for generations to come. Simultaneously, such actions will slow rates of sea level rise.”

“We hope that the findings of this work will serve to raise awareness of the urgent, global need to prepare for shrinking freshwater availability on land; greater vulnerability to sea level rise along coastal regions; and the interconnected, widespread impacts of continental drying on people, the environment, and the economy. Major coordinated, national, international, and global, transdisciplinary efforts are critically needed to elevate the level of awareness and action around continental drying and decreasing freshwater availability to that of the carbon cycle.”

     In the methodology section, the authors show how they calculated TWS and separated it into its snow-water equivalent, surface water, soil moisture, and groundwater components.

     The ProPublica article cites activist environmentalist scientist Peter Gleick, who says that groundwater overpumping is severely threatening food production, since 70% of groundwater is used for agriculture. I doubt that the issue is severe yet since it would mainly affect drier areas. Gleick has documented the social effects of droughts and groundwater depletion on things like conflict and migration. There is a need for better water management. California has implemented some policies and standards, but many think they are not acting fast enough to preserve groundwater. Groundwater management needs to be considered everywhere, but especially where aquifers are scarce and vulnerable to depletion, and where it is dry.

 

Land Subsidence Due to Groundwater Withdrawal is a Major Problem in Many Cities

     I remember how the flooding in Houston from 2017’s Hurricane Harvey was exacerbated by land subsidence due to groundwater withdrawal. The ProPublica article mentions Mexico City and large parts of China, Indonesia, Spain, and Iran as places at high risk for continued subsidence. A 2025 study in Nature Cities concludes that 28 cities across the United States are sinking, including New York, Houston, and Denver. As noted in the paper’s abstract below, the problem is creating very significant risks to urban infrastructure.

     The paper highlights some groundwater management actions that could help reduce the problem. They involve mitigating the problem with more land use restrictions, groundwater recharge, and engineering solutions such as structural reinforcement and soil compaction, and adapting to the problem by not building or building differently in high-risk areas. Unfortunately, this problem of urban land subsidence due to groundwater withdrawal is likely to increase, so cities need to become better prepared to handle the problem.

      

      

 

 

References:

 

The Drying Planet. Abrahm Lustgarten, Graphics by Lucas Waldron, Illustrations by Olivier Kugler for ProPublica. July 25, 2025. Global Water Supplies Threatened by Overmining of Aquifers: New Study — ProPublica

New global study shows freshwater is disappearing at alarming rates. Sandy Keaton Leander. Phys.org. July 25, 2025. New global study shows freshwater is disappearing at alarming rates

Unprecedented continental drying, shrinking freshwater availability, and increasing land contributions to sea level rise. Hrishikesh A. Chandanpurkar, James S. Famiglietti, Kaushik Gopalan, David N. Wiese, Yoshihide Wada, Kaoru Kakinuma, John T. Reager, and Fan Zhang. Science Advances. 25 Jul 2025. Vol 11, Issue 30. DOI: 10.1126/sciadv.adx0298. Unprecedented continental drying, shrinking freshwater availability, and increasing land contributions to sea level rise | Science Advances

Global groundwater wells at risk of running dry. Scott Jasechko and Debra Perrone. SCIENCE. Volume372. Issue 6540. Page418-+DOI10.1126/science.abc2755. April 23, 2021. Global groundwater wells at risk of running dry-Web of Science Core Collection

The hidden crisis beneath our feet: Disappearing groundwater requires action to prevent widespread water scarcity. James S. Famiglietti and Grant Ferguson. Science. 23 Apr 2021. Vol 372, Issue 6540. pp. 344-345. The hidden crisis beneath our feet | Science

Land subsidence risk to infrastructure in US metropolises. Leonard O. Ohenhen, Guang Zhai, Jonathan Lucy, Susanna Werth, Grace Carlson, Mohammad Khorrami, Florence Onyike, Nitheshnirmal Sadhasivam, Ashutosh Tiwari, Khosro Ghobadi-Far, Sonam F. Sherpa, Jui-Chi Lee, Sonia Zehsaz & Manoochehr Shirzaei. Nature Cities volume 2, pages543–554 (2025). Land subsidence risk to infrastructure in US metropolises | Nature Cities