The U.S. Bureau of Reclamation, which manages the river, released projections showing a 52 percent chance the river's biggest reservoir, Lake Mead in Arizona and Nevada, will fall low enough in 2020 to trigger cutbacks under agreements governing the system.
If that happens, those two states and Mexico would be the first see their share of water cut. Further drops in the reservoir could trigger cuts for other states.
The chances of a shortfall rise to 64 percent in 2021 and 68 percent in 2022, the bureau said.
Lake Mead has never fallen low enough to trigger cutbacks, but a nearly two-decade drought and growing demand makes a shortage more and more likely.
The river serves about 40 million people and 6,300 square miles of farmland in the United States and Mexico. In the U.S., Arizona, California, Colorado, Nevada, New Mexico, Wyoming and Utah all use the river or its tributaries, along with 20 native American reservations.
The shortage projection prompted Bureau of Reclamation Chief Brenda Burman to prod the seven river states to finish long-delayed contingency plans for worsening conditions.
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"We need action and we need it now," Burman said in a written statement. "We can't afford to wait for a crisis before we implement drought contingency plans."
Burman urged the states to finish the plans by the end of the year.
The states have agreed to come up with the plans but Burman has limited power — other than verbal persuasion — to make it happen. The river is governed by a collection of international treaties, interstate agreements and court decisions, and no single agency is in charge.
The agreements specify that cutbacks will kick in if the surface of Lake Mead drops to 1,075 feet (328 meters) above sea level.
Arizona would take the biggest hit, losing 320,000 acre-feet or 11.4 percent of its annual allocation from the Colorado. An acre-foot is enough to supply one typical U.S. household for a year.
Nevada would lose 13,000 acre-feet or 4.3 percent. Mexico would lose 50,000 acre-feet or 3.3 percent.
Most of the water in the Colorado River is snowmelt from mountains in Colorado and Wyoming. Because of the drought, last winter's snow was uneven but generally well below average across the region.
Federal forecasters said Monday the river is expected to carry only 43 percent of its average amount of water this year into Lake Powell, another big reservoir upstream from Lake Mead.