County Water Authority OKs Desalination Plant Despite Opposition

Despite opposition from environmentalists and the Ramona water board, the San Diego County Water Authority Board of Directors overwhelmingly approved a 30-year deal to take desalinated water from a future plant in Carlsbad Thursday.

The Ramona water board directed the Ramona Municipal Water District's County Water Authority representative, General Manager David Barnum, to vote against the plant at the Nov. 29 meeting. Ramona's weighted vote was just 1.6 percent, compared to the City of San Diego's vote at 40 percent. Barnum said 24 agencies voted at the meeting in Kearny Mesa.

The county water authority said the plant will provide 8 percent of the total regional water supply by 2020. The project, headed by private developer Poseidon Resources, will affect Ramona Municipal Water District customers, since water for the town is bought through the county.

Rchard Hannasch, the financial services director for the Ramona district, said at an October water board meeting that the the increase supply would also mean in an increase in rates.

"It would be a $1 million a year increase," Hannasch said, which works out to about a 13 percent increase. "It will supply more water to the region, but at a much higher cost."

The county gave a presentation to the board on desalination on Oct. 23, where an official explained that if majority rules on the desal vote, Ramona will have to pay their share for the desal water in years to come.

Under the agreement, the total price for the water—including costs to make improvements to the water authority’s pipelines and treatment plant to accommodate the new supply—is estimated at $2,042 to $2,290 per acre-foot in 2012 dollars, depending on how much water is purchased annually, according to the county water authority.

Water authority officials say converting seawater will provide the region with a water supply more reliable than imports from the Metropolitan Water District.

San Diego Mayor Jerry Sanders called it "a historic deal that will make our future more secure."

The water authority board voted in favor of the purchase agreement by margin of 85 percent to 10 percent, with the rest abstaining.

"We are now putting another big piece of our diversification plan in place that will help protect our region's $186 billion economy from the potential shortages and the uncertainty created by heavy reliance on imported water," said Thomas Wornham, chairman of the Water Authority's Board of Directors.

Authority Deputy General Manager Sandy Kerl told City News Service that desalinated water will be pricier than imports initially, but the cost of MWD water is expected to climb at a faster rate. Over the last decade, Metropolitan Water District import prices have risen 7.85 percent annually, she said.

"The Water Purchase Agreement protects ratepayers from cost overruns and construction problems—but it does allow for increases due to certain expenses such as electricity and uncontrollable events such as acts of terrorism," Kerl said. "The contract also contains caps that limit increases in any given year, and to no more than 30 percent over the life of the 30-year agreement."

Poseidon Resources hopes to build the desalination plant adjacent to the Agua Hedionda Lagoon and have it operating by 2016. At full steam, it would produce about 50 million gallons of fresh drinking water per day through reverse osmosis. The total would account for around 7 percent of the region's water supply.

Now that the plant is approved, Poseidon and the San Diego County Water Authority will go to the bond market for financing. According to the water agency, construction would then commence on the plant and a 10-mile pipeline to connect with its aqueduct in San Marcos.

Environmentalists contend the plant would harm marine life, and that its financial provisions create risks for ratepayers.

On Monday, the Surfrider Foundation's San Diego chapter released a consultant's report asserting that the 30 percent cap in rate increases exposes ratepayers to too much risk. The report also said the cost of electricity needed to run the plant will rise significantly as utilities try to meet regulatory demands for renewable energy.

According to the authors, the debt structure is back-loaded with planned 2.5 percent annual cost increases.

Joe Geever, the water programs manager for Surfrider, said environmental organizations prefer conservation and recycling measures to desalination.

Several members of the board, however, said it was time to move ahead on all fronts, including recycling water and desalination, and make use of the vast source along the coast.

SDCWA board member Jim Madaffer equated the purchase agreement to obtaining an "insurance policy" against future problems with water supplies.

–City News Service contributed to this report.