California's Wine Exports Reach Record-Breaking Levels

Of the various foods that California produces for export, many have faced hard times over the past couple of years, mainly due to the scarcity of water throughout the state. Almonds, California's largest export, grow on trees that require gallons of water to grow properly. Those almond trees have suffered over the past couple of years, and, even though rainfall has increased, the trees may not recover, at least not any time soon. Fortunately, even though the almond market has hit rough times, other exports from California have reached record levels. In his L.A. Times article, Geoffrey Moan discusses increased exports of American wines in 2016, led by California's brands.

Even with the increased strength of the dollar, a limited water supply, and high tariffs, which all had limiting effects on the wine exports, foreign trade revenue still increased from $1.49 to $1.62 billion in 2016. Of all of the wine exported from the United States, around 90% came from California. Not only did the volume of wine increase, so too did the prices of those wines. Golden State labels have gained higher prestige in foreign markets, and vintners take advantage of that "premiumization" to mark up the wines. It seems to be a good business strategy that hasn't negatively impacted demand while still increasing revenue.

The single country that imported the largest amount of U.S. wine was Canada, accounting for $431 million in table wines. Behind them came Germany and Britain who, along with the rest of the countries in the European Union, imported a total of $685 million in American wines. Behind them came Mexico, Switzerland, and several Asian countries, who collectively accounted for the remaining portions of U.S. wine export revenue. Wine exporters have faced some difficulties with laws in British Columbia and other areas that prevent retailers from carrying foreign wine brands, but exports have still increased despite such restrictions.

Exporters throughout the U.S. expect that the demand will continue increasing, so limits on foreign retailers could pose future issues. While some exporters are working with foreign governments to try to gain equal access to their markets, other exporters make "trade tours" through the countries that import the most product, to renew their relationships and remind importers of their company's commitment to the wine market. While American wines have plenty of domestic demand, which is why the wine industry depends much less on exports than other industries, vintners are focusing on foreign markets mainly because they represent the best opportunity for fast growth. Their work right now will help to define their growth in the industry in years to come.

***************************************************************************************************
Find out more about us at www.sepulvedaescrow.net. Any Questions? Contact our Escrow Expert! Sepulveda Escrow Corporation (818) 838-1831. Follow our company on Facebook, Twitter, LinkedIn, and Google+.

***************************************************************************************************

New Research Involves Renewing Groundwater Supplies, Not Filling Reservoirs

In a test on a potential new way to reduce the effects of California's recurring drought conditions, researchers are looking not to expand reservoirs, but rather find a way to funnel the excess rainwater from the El Nino winter back into the groundwater, where it can be put to better use during the drier seasons. Currently, the majority of rain runs off into the ocean, simply because a large portion of the land is covered in concrete or asphalt, which doesn't allow rainwater to permeate. Through this ongoing experiment, depicted in Geoffrey Mohan's L.A. Times article, the water is instead redirected to the fields of involved farmers, where the water is able to seep into the soil.

While creating new reservoirs and expanding existing reservoirs could accomplish the same goal, the experiment aims to show that it can be accomplished more naturally and cheaply. Simply by harnessing the power of gravity, storm runoff could be forced into irrigation channels. From the irrigation channels, several fields in succession can be watered before the rest of the runoff can make it to nearby lakes and rivers. Once upon a time, farmers used only surface water and groundwater to tend to their crops. In this day and age, the groundwater levels are so depleted, especially during drought seasons, that there isn't enough water to make that system feasible.

That system could once again become helpful for farmers and common folks alike, once the groundwater levels have been put back to normal. Through a large-scale application of the concepts present throughout the experiment, everything from wells to reservoirs could be filled with the rainwater that would normally be wasted as runoff to the ocean. Unfortunately, not very many people have volunteered to be a part of the study. Some are, quite reasonably, simply unwilling to risk their trees in the event that the experiment ruins them. More often, state or federal agencies control the water in dams and canals and put up a lot of red tape due to their worries that the water may benefit people who aren't paying for it.

The research is risky, but well worth it in the long run. The water might spur fungal disease in the trees, but it also might kill off worms and mites. The test measures whether the concentration of contaminants like nitrogen-based fertilizers increases in the total groundwater and what effects that might have on the ecosystem. In general, the experiment is looking to make sure whether this would be an effective way to store water for use in drier times. From what has been measured so far, the irrigation hasn't ruined the test trees, but it will still be a while before significant results can be found.

According to researchers' approximations, there are about 3.6 million acres of agricultural land in California alone that have the proper characteristics to make them usable in groundwater-refilling projects. The only issue is that everyone would have to work together to make this concept a reality. For the first few years, crop yields will likely decrease due to the plan, which will make many farmers want to drop out. However, if they all stick it out to the end, the groundwater levels would eventually become properly equilibrated, which would extremely dampen the effects of future drought conditions in the area. It would just take a lot of cooperation between individual farmers and governmental agencies, as well as a unified belief that renewing the environment will have far more positive effects, both economically and otherwise, in the long  run than making a quick buck today.

***************************************************************************************************
Find out more about us at www.sepulvedaescrow.net. Any Questions? Contact our Escrow Expert! Sepulveda Escrow Corporation (818) 838-1831. Follow our company on Facebook, Twitter, LinkedIn, and Google+.

***************************************************************************************************

Rising Insurance Costs in High Fire-Risk Areas

When a home is purchased with a mortgage, using a loan from a bank, the bank will always require the homeowner to get insurance in order to make sure their investment is protected to some extent. Insurance, while a necessity, can be a costly addition to one's monthly or yearly bills. Since an insurance company wants to stay in business, it charges higher rates to provide insurance to individuals in high-risk areas: flood zones, fire zones, earthquake centers, etc, so that it will have the money to pay off claims involving fixing or rebuilding of affected properties. For people like John Stoffan in Samantha Masunaga's L.A. Times article, the costs of fire insurance in drought-parched California make the state almost too costly to bear.

The Stoffan family, whose Northern California home survived various wildfires around Yosemite National Park throughout the years, is finding that their insurance rates may actually be the reason they finally jump ship. The house itself, as well as the county in which it is situated, are considered to be "high-risk" for insurance companies. Even after having installed fire-resistant plants, developed "buffer zones" of areas without any plants surrounding the property, and created holding areas to keep thousands of gallons of water on hand, insurance companies have doubled rated in the past year.

The past four years of dry conditions have made things worse for those living near large forests. The combination of summer temperature and lack of water can turn a forest into a raging wildfire with the merest spark. Because of this risk, home-owners like the Stoffans, no matter how many preventative measures they take, are stuck between a rock and a hard place. They need insurance to have a mortgage to own a home, yet the insurance rates are unaffordable and getting worse. What is their alternative?

While all are hoping for a good winter to break California's dry spell, many are considering moving out of the area altogether. Others have found more creative options to reduce their insurance costs. Some people, like Alpine's Mollie Jacques, have been able to find significant discounts by using insurance companies based in other cities. For Jacques, her choice to switch to an insurance company 100 miles from her home saves her over $700 per year. Some homeowners have even been refused insurance completely and have been forced to use the California Fair Plan Association to have some, albeit limited, coverage.

Communities are coming together in these fire-prone areas to try to make their homes and surrounding land as safe as possible. Since insurance companies determine rates through statistics involving fire department preparedness, water supplies, and availability of emergency communication. With the help of the California Fire Safe Council, a nonprofit organization, such communities are able to purchase wood chippers and other machinery to help clear dry brush and other flammable material. The more prepared a community becomes for a wildfire, the better rates insurance companies will provide. It comes down to economics. Insurance companies will charge a lot of money for taking on a huge financial risk. The more you lower that risk for the insurance company, the less money they will require you to pay.

***************************************************************************************************
Find out more about us at www.sepulvedaescrow.net. Any Questions? Contact our Escrow Expert! Sepulveda Escrow Corporation (818) 838-1831. Follow our company on Facebook, Twitter, LinkedIn, and Google+.

***************************************************************************************************

Drought Conditions Prevent Ability to Store Sustainable Energy

For companies like Southern California Edison, the drought is taking its toll on their sources of sustainable energy. When water stored in artificial lakes high in the mountains is released, it flows down to turn hydroelectric turbines and convert the water's kinetic energy into electrical energy for use by consumers. This system only works when the water is available for use. Because of the drought, water levels have dropped so far that the hydroelectric system has been put on hold for the time being. According to Ivan Penn, in his L.A. Times article, the hydroelectric power is not the only source of power being lost due to depleted water reserves.

Renewable resources are those that are considered to be constant in nature, that will always be available on Earth. Sunlight, wind, and water are some examples of such resources. You may ask, “Why is water considered 'renewable' if a drought can reduce the amount available?" This is due to the fact that, while a drought reduces the availability of water in specific parts of the world, the amount of water available throughout the entire world remains relatively constant. 

As more and more research comes out showing the negative effects that coal and fossil fuels have on the environment, as well as the rapidly diminishing supplies of such resources, both government agencies and private corporations search for a more sustainable alternative. Wind and solar energy seem to provide the greatest return on investment, to the extent that many homeowners have installed their own solar panels to harness the Sun's natural power for themselves. Unfortunately, power companies have yet to find a way to store excess energy. Just as blackouts and power reductions can be caused by too little power being produced, too much power can overload the power grid and damage everything connected to it.

Edison has a system that, in non-drought times, would be quite effective in storing excess energy for later use. when the water has flowed down the mountain and through th3e turbines, it ends up in another manmade lake. When their solar panels and wind turbines collect more energy than can be used by consumers, the excess energy is used rather than given away at negative prices. The energy is used to power pumps that bring the water back up the mountain and stored back in the starting lake. In this way, "energy" can be stored, though not in the classical sense.  Since energy can only be converted, not created or destroyed, the excess energy is converted from electrical to mechanical (pumps) to potential (water on top of the mountain). Then, when the energy is needed again, the water is released from the lake and the potential energy becomes kinetic, then electrical once again. 

At nighttime, stored energy is needed to make up for the fact that no solar energy is being collected. While Edison's energy storage system, of course, has loss associated with it, since all processes lose some energy as heat, it is better than the alternative in which excess energy is given away to competing companies in order to prevent overloading of the power grid. However, drought conditions have everyone at a loss. How else can the energy be stored in an economical, efficient, and environmentally-friendly manner?  

As Penn points out, it's not as if we can control Sun or wind on command. Renewable energy sources are great and have become more utilitarian and widely used in recent years, but it seems that the most effective use of researchers' time would be to find a better way to store the energy.  If renewable, sustainable energy can be stored and easily accessed, then there would be little reason to use fossil fuels and other degradative materials as energy sources. As such, solar, wind, and hydroelectric power are arguably the best and cheapest energy sources, but they can only live up to their true potential if scientists find an effective way to store the excess. 

***************************************************************************************************
Find out more about us at www.sepulvedaescrow.net. Any Questions? Contact our Escrow Expert! Sepulveda Escrow Corporation (818) 838-1831. Follow our company on Facebook, Twitter, LinkedIn, and Google+.

***************************************************************************************************

Using Economic Principles to Reduce Water Shortages

10/15/14 - Economics is all about supply and demand, cost and benefit analysis. Yet, when it comes to water, one of the world's most necessary goods, government subsidies and and reduced costs lead to people treating this resource as if it has an unlimited supply. In his article in the New York Times, Eduardo Porter discusses how treating water as a commodity could reduce the effects of the drought nationwide.

As with any product in a healthy economy, as price goes up, demand goes down, and as price goes down, demand goes up. Across the United States, water prices are very low. These low costs, combined with a high personal benefit, lead people to purchase more water, and thus consume more. It's one thing to ask nicely for people to reduce their water consumption, but a higher cost would be a more successful deterrent for many consumers.

The scarcity of water is not going to change. No matter how many icebergs are towed to land for human consumption, no matter how many desalination plants are built, we have a limited amount of water in the world. Water costs around the country are commonly reduced to a point at which water companies would be losing money if the government wasn't providing subsidy funds. But that isn't how it should be. If water cost more, people would be more careful about leaving a faucet running while doing dishes, or would think twice before deciding to drain and refill a swimming pool.

While many homes, even in the middle of a drought, pay a flat fee for their water usage each month, there are a few places, Irvine Ranch for example, that charge more money per unit of water as the number of units increases. Some states require the purchase of already-existing water rights from an owner of such rights before beginning a new building construction. In that way, only a specific number of people can own water rights at any given time.

According to Porter, farmers are the worst cause of water shortage in America, accounting for about 80% of the total national consumption at a fraction of the price of most consumers. Due the government's reduction of water prices for farmers, such farmers commonly perform “flood irrigation,” a process by which the entire field is flooded with water, in which much of the water goes to waste. While the actual, unsubsidized cost of an acre-foot of water might be $2000 and the sale price of an acre-foot of alfalfa that uses this water would be $920, which makes no sense economically, this is the way water is being used currently. If farmers were to be charged the actual cost of the water, they would realize that the benefit doesn't outweigh the cost.

Water is a necessity, but it is also a good. If prices are raised, if water is is treated economically, then people will be forced to reduce water use. In general, people understand cost-benefit analysis; we perform it on a daily basis. If wasteful usage of water were to lead to higher costs, then people would stop wasting it. While everyone likes low water costs and would likely be upset if those were to end, increased prices and reduced subsidies may be the only way for us to scale down the negative effects of this drought and any others in our future.

***************************************************************************************************

Find out more about us at www.sepulvedaescrow.net. Any Questions? Contact our Escrow Expert! Sepulveda Escrow Corporation (818) 838-1831. Follow our company on Facebook, Twitter, LinkedIn, and Google+.

***************************************************************************************************