In early summer, Kilimo — a Latin America-based climatech company focused on improving agricultural water security — announced it had launched an irrigation improvement project in California’s Central Valley in partnership with Microsoft and Netafim.
According to Kilimo, the farms participating in the new Central Valley project raise forage crops such as winter grass and summer silage corn, wheat and tomatoes. Like previous similar projects with Microsoft in Chile and Mexico, the new project will transition participating farmers currently using flood irrigation to drip irrigation.
“The conversion to drip irrigation is going to be fully financed by us and the corporate partner,” says Jairo Trad, CEO and co-founder of Kilimo. He stresses that this partnership is quite unique: “This is a private stakeholder financing another private stakeholder without the government intervening.”
Based on past results in earlier projects, Kilimo estimates the water savings could approach 50%.
Microsoft’s involvement in the project is part of its commitment to becoming water positive by 2030. This commitment includes supporting projects that replenish more water than the company consumes.
“We’re thrilled to collaborate with Kilimo and Netafim to support farmers in saving water in California’s Central Valley,” says Eliza Roberts, water lead at Microsoft, in a news release. “Irrigation conversion is a critical solution that preserves water and supports farmers in combating climate challenges.”
California irrigation ripe for improvement
Trad explains that Microsoft’s partnership on projects like the new Central Valley one is not just corporate responsibility, but pragmatic and proactive.
“Microsoft, like many other tech companies, understands that they have risk tied to water,” he says, giving examples like data centers that need water for cooling or manufacturing companies that use water in their processes. “Most of the water we use is in agriculture, so if you want to invest in reducing water risk, you have to work in the agricultural sector.”
As of 2023, an impressive 4.36 million acres (52.6%) of California’s 7.76 million acres of irrigated cropland were already under some form of drip or similarly efficient irrigation system. Across the country, there were only 6.43 million total acres under such systems, meaning California represented roughly two-thirds of the country’s total.
However, California also used 22.6 million acre feet of irrigation water — over three times that of the next-highest irrigator, Nebraska at 6.8 maf — making it the largest user of irrigation water in the country. It also had 2.95 million acres irrigated via gravity systems, which include various forms of flood irrigation.
Trad positions using flood irrigation is an example of a low-value use of water.
“Water is perpetually undervalued, even in areas where water is extremely scarce like California,” he says. It’s not that agriculture should have to pay more, he adds. “The question is: How can we realign incentives?”
Private-private partnerships
That is what partnerships like this one are trying to do, according to Trad. He describes such efforts as bringing new financing opportunities to farmers to improve their irrigation systems. But to get investments from companies like Microsoft, the water savings that might come from the switch must be measured and well documented. That’s where Kilimo comes in, Trad says.
“We have developed a solution and a set of methodologies that allow us to measure the volumetric water benefits in a way that is scalable, secure, comparable and that allows companies to be sure that the investment they are doing is well used and well measured,” he says.
The value proposition for participating farmers is great, too, he adds.
“They get a fully paid irrigation system,” he summarizes. “What we ask for in return — and this is us, not Microsoft — is access to the data. How much are you irrigating? So, we can prove that you are saving water.”
That and maintenance of the new equipment is an “extremely light” ask, Trad says. He compares it to the strings attached to government financing. He also calls this style of private-private partnership between water users and corporate organizations looking to mitigate their water risk an important growing trend.
“Companies are investing heavily in this,” he says. “This is private stakeholders engaging in reshaping how other private stakeholders are using water because they think that is going to be good for them too. And that’s great! What we need is for more people to do this.”
