From Quarry Magazine (Bill Langer):
Water law is a serious issue in the arid to semi-arid west of the United States. Colorado and Nebraska have an agreement that Colorado will allow no less than a specified amount of water to flow along the South Platte River from Colorado to Nebraska.
The problem is most of the flow of the South Platte comes in the spring from the melting of the snowpack. Millions of gallons of water flow into Nebraska, far exceeding the amount required under the Colorado/Nebraska compact.
To remedy this, the Two Forks Dam was proposed to be built on the South Platte River, near Deckers, Colorado.
However, the permit to build the dam, which would have held enough to meet the annual needs of 400,000 people, was denied.
Now, fast-forward to the start of the 21st century. At about the time Two Forks was dying, state mining engineers decided mined-out gravel pits could be used as storage reservoirs. That decision changed the way aggregate companies and local municipalities looked at the pits. Not only could aggregate companies get the economic benefit from the gravel, but also they could turn the mined-out land into a water storage facility for the nearby communities.
Municipalities along the South Platte scrambled to permit new gravel operations, as long as they could purchase the hole. Gravel operators were happy to oblige because frequently the holes in the ground were worth more than the gravel that came out of them.
Some rock quarries also became suitable storage places for municipal water supplies.
One such pit is in Tamil Nadu, India. It is one of 22 inactive quarries storing rainwater reserves that are pumped via a 2.5km pipeline to the Indian city of Chennai. Another pit, in Glen Innes, New South Wales, has been enormously successful for the local council and residents, boosting the city’s water supply.
With the decline in the construction of new dams, this phenomenon has spread across the United States (and is also occurring in Australia).