In most parts of the world, islands are bits of dry land that stick out of the water. The term has quite a different meaning in the Sacramento-San Joaquin Delta, a place where human ingenuity has managed to stand geography on its head. Delta "islands" are dry land, all right, reclaimed by dredge and steam shovel from the network of river channels, sloughs and marsh that once covered 1,000 square miles at the confluence of California's two principal waterways. The Delta islands, however, are lower than the water around them (some are below sea level) and remain dry only because they are protected by a 1,100-mile network of levees. This peculiar characteristic — islands that actually are dry holes in a liquid landscape — has spawned a controversial plan to supplement the state's water supply by transforming corn and wheat fields into shallow reservoirs. Instead of keeping the rivers out, the levees surrounding two of the largest Delta islands would be reinforced and used to keep fresh water in, capturing it during times of high river flow and releasing it — for a price — in the dry season. Delta Wetlands, a private company based in Lafayette, won approval for its plan in February from the State Water Resources Control Board (SWRCB). Although the project has undergone years of review, it still requires federal and local permits. It also faces opposition from local farming and environmental groups, as well as practical hurdles related to the cost and quality of the water it would provide. Still, it is an intriguing new twist in California's unceasing campaign to capture, store and redistribute its most precious resource. Unlike most of the state's water-storage projects, this one would not dam a river or destroy wildlife habitat. Nor would it be subsidized with public funds. On the contrary, it represents an effort to transform water into a privately marketed commodity like tomatoes or asparagus. And unlike most previous water marketing proposals, this one appears likely to become a reality thanks to the Delta's pivotal role in the state's gargantuan water system and the unusual history of Delta agriculture. The Delta region is a triangle with its apex at the eastern edge of Suisun Bay. It is about 50 miles across its base, a line passing through Stockton and reaching roughly from Tracy in the south to Elk Grove in the north. Efforts to farm the rich soil laid down in the Delta by the Sacramento and San Joaquin rivers began during the Gold Rush, but it was not until the early 20th century that powerful equipment and ample investment capital transformed the region. Dredges cut straight shipping channels through the Delta's maze of tule-clogged sloughs. Giant shovels piled the spoils into levees encircling large tracts of marsh, and the water inside was pumped out. Thus drained, the rich peat soil could be plowed and planted. Delta soil, however, has a peculiar characteristic: Exposed to the air, the formerly submerged peat oxidizes and blows away as fine dust. Heavy farm equipment compacts it. Since they were created, the islands have subsided by as much as 1.5 inches a year. Some are now 25 feet below sea level. Yet as long as the levees are maintained — an increasingly expensive and difficult task as the ground sinks — the farms inside remain productive. The annual value of Delta crops exceeds $500 million.The region's most valuable product, however, is not food but water. As the meeting point of the state's two largest waterways, as well as the smaller Mokelumne, Cosumnes and Calaveras rivers, the Delta receives 47 percent of the state's freshwater runoff, including springtime snowmelt stored behind foothill dams that is released during the summer. That made the Delta a practical place to install the huge pumping plants that drive the State Water Project (SWP) and the Central Valley Project (CVP), which together supply water to 20 million people and most of California's irrigated cropland. Delta Wetlands hopes to take profitable advantage of this setting. With investment money from Kemper and Lumbermen's Mutual insurance companies, it has purchased four parcels totaling 20,000 acres. Webb Tract and Bacon Island, together comprising 11,000 acres, would be used as reservoirs. Nearby Holland Tract and Bouldin Island would be converted into wildlife habitat. In the dry season, the company would sell water to thirsty downstream users, pumping water out of the island reservoirs into existing Delta channels for diversion by the SWP and CVP. Delta Wetlands predicts it will produce 170,000 acre-feet in average years, and 800,000 acre-feet in wet years. Although it seems a simple proposal, the Delta Wetlands project is being pursued in a fiendishly complex legal, political, economic and scientific context that renders its prospects questionable. In the Delta, urban and agricultural water demands compete with each other and wreak havoc on fish and wildlife by disrupting the aquatic ecosystem. Control of the region's future — and therefore influence over the state's water supply — is the prize in a fierce tug of war between city dwellers and farmers, rural counties and metropolitan areas, environmentalists and business groups. Since 1994, an ambitious state-federal partnership known as the Cal-Fed Bay-Delta Program has been attempting to negotiate a truce. Last summer, Cal-Fed unveiled its preferred alternative for the first phase of a 30-year program to restore the Delta's ecological health, improve the quality of water diverted by CVP and SWP pumps, and assure a more reliable supply for everyone. Cal-Fed has long envisioned something like the Delta Wetlands proposal to supplement other types of underground and surface storage. The program unveiled last summer calls for 250,000 acre-feet of "in-Delta storage" and proposes either buying the Delta Wetlands project or negotiating with other landowners to construct something similar. Nevertheless, the project faces skepticism. San Joaquin County officials are unhappy that it will take farmland out of production. Deltakeeper, a Stockton-based environmental group, has suggested that the project's water — having spent weeks or months in shallow reservoirs atop peat — will be so dirty, warm and low in oxygen that it will harm aquatic life. The Central Delta Water Agency's attorney has said it plans to appeal the SWRCB ruling, questioning a private firm's legal right to profit from water sales. In the end, though, the real test of the Delta Wetlands project will be whether it can find a market for its product. The company has said it hopes to sell water for $200 to $300 an acre-foot. That's far too expensive for farmers. Urban users can afford it, but they are already unhappy about the poor quality of Delta water. It remains to be seen whether they will get thirsty enough to pay top dollar for more of the same. Contacts: Delta Wetlands: 916-646-9900 Deltakeeper: 209-464-5090 Central Delta Water Agency: 209-465-5883 Cal-Fed Bay-Delta Program: http://calfed.ca.gov/