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'Drought' beer: California breweries hit dry times

How many bottles of water go in that beer on the wall?

A lot.

"Beer has to have water," said Luis Cayo, general manager for the Anheuser-Busch brewery in Los Angeles, which has survived many droughts over the last 60 years. "The amount of water in a standard can of beer is about 92 percent."

This drought, however, is the most severe on record, and there's no end in sight. Agriculture operations and manufacturers across California are drilling deeper, paying more, and competing with each other, with wildlife and with residents for water. But in the brewing business, it's not just the water going into the cans which is now at a premium. It's the water used to clean tanks.

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At the Budweiser plant, Cayo said the company has started using reclaimed water to clean tanks. It also ripped out landscaping and replaced it with drought-tolerant plants: "Believe it or not, it saved about five million gallons of water."

The brewery encourages employees to come up with more water-saving measures, which Cayo said reduced water needs by 3 percent "without any capital expenditure." They're even working with barley farmers in Idaho to manage irrigation more efficiently.

"Every day we track our water usage," Cayo said. "Since 2009 we've reduced our water usage 31 percent, 9 percent in the last year, and we're targeting 10 percent in the following year."

Bear Republic Brewery Sign, brewery
Getty Images

It's not just beer giants like Bud that are struggling to make beer with less water. California's fast-growing craft brewing industry is having the same problem.

Up in Cloverdale, business had been so good at Bear Republic Brewing that CEO Richard Norgrove wanted to double capacity. However, the city said expansion would be impossible without more water.

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Cloverdale applied for funding from the U.S. Department of Agriculture to drill two new wells, but that process was taking a while. So Bear Republic decided to pay $450,000 in development impact fees in advance in order to give the city the cash it needed to drill right away.

"The brewing company came forward and said they wanted to be in Cloverdale, this is where they wanted to put their brewery, this is where they wanted to have their employees be, this is where they wanted to produce their beer," said City Manager Paul Cayler.

Standing by one of the new wells created with the brewery's money, Cayler said Cloverdale was able to drill last October before the drought became especially severe. "It's not a loan, it's not a gift, these were fees that any developer who would come into our town would have to pay," said Cayler. "What Bear Republic did was made the investment now rather than later."

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Both Cayler and Norgrove believe there is now enough water for the next 3-5 years, but what about after that? Other breweries are expanding back east, in part to reduce transportation costs to new markets, in part to have access to more water. Norgrove said his company has at least considered moving, too.

"I mean, can you imagine a drought like this going over the next 10 years?" he asked. "I think you're going to see a lot more than breweries leaving this area. You're going to see your major agriculture areas picking up and going somewhere else."

That could leave California high and dry and crying in its beer.

Correction: A previous version of this story incorrectly stated that Bear Republic Brewing installed a new waste water treatment system in order to save water. The system has not yet been installed.