Southern California Desalination Plant will Ease Water Crunch, but Price is Steep

Sacramento Bee

Carlsbad, CA (December 12. 2015) - The newest weapon in the war on drought in California has arrived, an engineering marvel that will harvest drinking water from the ocean on a scale never before seen in the Western Hemisphere.

A giant water desalination plant will open this week north of San Diego, tucked behind a power plant across the street from Tamarack State Beach. It will produce 50 million gallons of fresh water each day, meeting 7 percent to 10 percent of the San Diego County Water Authority’s demands and buffering the region against supply shortages for decades to come.

Oh, and it will be expensive – ridiculously so, in the minds of some critics. Built by privately ownedPoseidon Water of Bostonfor $1 billion, the plant will deliver some of the priciest water found anywhere in California. It will cost twice as much as the water San Diego gets from the Metropolitan Water District of Southern California, which provides the bulk of San Diego’s supplies.

Yet San Diego officials say the Carlsbad project, representing a comparatively small slice of its overall water supply, will add only a few dollars a month to customer bills. Besides, with Metropolitan’s prices relentlessly rising, San Diego officials say desalination eventually will become competitive with the region’s other water sources.

What’s happening in Carlsbad could have implications for statewide water policy. The first major desalination facility built in California and the largest in the Western Hemisphere, it could establish desalination as a potentially major tool in solving the state’s long-term water stress.

“I think we’ve blazed a trail,” said Sandy Kerl, deputy general manager of the San Diego water authority. “It’s being watched with a lot of interest.”

The public will get its first glimpse at the grand opening Monday. Commercial operations will start later this month, with the arrival of the first flows of desalinated water at the authority’s aqueduct 10 miles inland. It marks a pivotal moment in a journey that began 15 years ago, when the plant was initially proposed.
“If it’s successful, as I believe it will be, others will follow,” said Peter MacLaggan, the Poseidon vice president overseeing Carlsbad.

Until now, desalination has produced just a trickle of California’s water supply. Although the technology has been around for centuries, it requires a lot of energy, the process is expensive and normally cheaper water is available from conventional sources. It’s also controversial among environmentalists, who say fish and other marine life can be harmed when seawater is sucked into the plants and leftover brine is discharged into the ocean.

California has just two dozen small desalination plants, most of them inland facilities that clean up brackish groundwater. In fact, only one significant desalination plant operates in the United States, a Tampa facility half the size of Carlsbad’s.

The Tampa plant has had something of a troubled history. Poseidon was its original developer but was replaced after financial problems arose with two of its contractors. It took years for the plant to get up to full speed. San Diego officials researched the problems in Tampa before they signed up with Poseidon and say they’re confident in the company’s abilities.

“We didn’t just walk into this,” Kerl said.

Desalination has a far more accomplished track record in other parts of the world. It’s practically a mainstay in the parched Middle East and generates 70 percent of Saudi Arabia’s drinking water and 25 percent of Israel’s. It’s no coincidence that a leading Israeli desalination company, IDE Technologies, will operate the Carlsbad plant.

“In the Middle East, they have no options,” said Tom Pankratz, an industry consultant in Houston and editor of the Water Desalination Report.

Now, because of drought and the specter of climate change, California’s options appear more limited and desalination is getting a fresh look.

State policy encourages it: Proposition 1, the$7.5 billion water bond measureapproved by voters in 2014, allocates $100 million to help local water agencies build desalination plants. Several coastal communities are looking at building small desalination plants. Santa Barbara is planning toreopen a small plantthat ran for three months in 1992 and got mothballed after the early-1990s drought ended.

“It’s because of the severe drought we’re in,” said city project engineer Bob Roebuck. “That’s the entire motivation. Our water reservoirs are extremely low.”

A ‘drought-proof’ supply

Still, it seems unlikely that desalination plants will become a major feature of California’s fabled coastline anytime soon. The Carlsbad project endured 14 lawsuits and more than a decade of negotiations and red tape before Poseidon could break ground. Construction took three years.

Along the same lines, Poseidon has been working for years to clear regulatory hurdles on a plant it is proposing in Huntington Beach, a project about the size of Carlsbad’s. It has the tentative blessing of local officials, but a green light from the state is anything but assured.

California appears to be of two minds about desalination. While state officials are offering Proposition 1 dollars for plant construction, the environmental regulations remain formidable.

Poseidon’s Huntington Beach project is running into resistance over the design of its intake valves. A new state policy, implemented earlier this year by the State Water Resources Control Board, says the valves should be built underneath the ocean floor, if feasible. That would keep fewer fish and larvae from getting sucked into the plant’s mechanism. (Carlsbad got its permits before the policy was approved and doesn’t have this “subsurface” intake feature.)

This isn’t a small point. Poseidon, citing a recent report from anindependent scientific panel,says installing intake valves beneath the ocean would create its own major environmental problems. The requirement also would kill the project’s economic viability by doubling construction costs to around $2 billion, according to the panel.

The intake design, and the entire project, face a crucial vote before the California Coastal Commission before the plant can proceed. The commission probably will vote next spring.

“I wouldn’t say it faces an uphill battle, but it faces a great deal of scrutiny,” said commission Chairman Steve Kinsey, a Marin County supervisor.

By then, the Carlsbad plant should have several months’ operational experience under its belt. Poseidon executives say the plant will prove the technology’s value once and for all.

YOU CANNOT MANAGE A COMMUNITY AND AN ECONOMY ON CONSERVATION ALONE.
Sandy Kerl, deputy general manager, San Diego County Water Authority

Now in its final testing phase, the plant will run in tandem with a nearby power plant, which draws cooling water from the ocean. Poseidon will take the water discharged by the power plant and pump it through a series of preliminary filters. The water then will flow into the heart of the Poseidon complex, the “reverse osmosis” building, where it will filter through paper-thin, plastic-coated membranes to remove the last vestiges of salt and other minerals. When the process is complete, the leftover brine will be diluted with ocean water and sent back to sea. The purified water will be fluoridated and chlorinated in preparation for delivery to the water authority.

The entire process will take an hour, said Poseidon vice president Scott Maloni.“It’s the only true drought-proof supply available, and it’s a half-penny a gallon,” he said.

Even so, desalination is expensive by California standards. Depending on how much it buys each year, San Diego has agreed to pay $2,131 to $2,367 an acre-foot for Poseidon’s desalinated water, including the cost of piping the finished product to the authority’s aqueduct. By comparison, Kerl said the authority pays just under $1,000 an acre-foot for water imported from Northern California and delivered to San Diego’s doorstep by Metropolitan. An acre-foot is 326,000 gallons.

San Diegans will begin seeing the financial impact in 2016. The costs of desalination are expected to increase the average residential bill, now around $80 a month, by about $5 a month.

State policymakers say there’s nothing necessarily wrong with expensive water – it encourages conservation. They’ve been frustrated, in fact, by a court ruling last spring that makes it harder for municipalities to impose substantial rate hikes to reduce consumption.

Nonetheless, environmentalists generally oppose desalination partly because of cost; they consider it an uneconomical, wasteful technology. Besides harming marine life, they say it consumes far too much energy. They want California to put greater emphasis on lower-cost recycling and conservation programs instead of finding new ways to expand consumption of water.

“There are less expensive alternatives; there are better alternatives,” said the Planning and Conservation League’s Jonas Minton, a former deputy director of the state Department of Water Resources.

The price of reliability

Critics also take issue with the particulars of San Diego’s deal with Poseidon, specifically the “take or pay” provision. The water authority’s contract obligates San Diego to buy at least 48,000 acre-feet of water each year from the Carlsbad plant, whether it needs it or not. The maximum purchase is 56,000 acre-feet annually.
Peter Gleick of the Pacific Institute, a water-policy think tank in Oakland, said San Diego’s deal reminds him of Australia’s zealous efforts to desalinate its way out of its 14-year “millennium drought.” He said six plants were built, at a cost of around $10 billion, but only two are operating now that the drought has ended.

“Four of them have been mothballed because they’re too expensive and they’re not needed,” Gleick said. “I think it’s premature for California to be going down that road.”

San Diego officials, however, staunchly defend the need for the plant, saying the time has come for a more diversified portfolio. The region has been among the leaders in the state on recycling and conservation, reducing per-capita water consumption by 39 percent in the past quarter-century. Officials say it’s time to expand supply.

“You cannot manage a community and an economy on conservation alone,” Kerl said.

Plunging into the desalination business also represents another step in San Diego’s quest for water independence. The water authority has had an uncomfortable relationship with Metropolitan, a powerful wholesale agency from Los Angeles that brings San Diego about half its water supply.

The relationship sometimes gets litigious. After San Diego cut a deal 12 years ago to buy water from farmers in Imperial County, it was required to pay hefty delivery fees to Metropolitan, which runs the canals connecting the two counties. San Diego challenged the fees in court, and a judge recently ruled that Metropolitan has beenovercharging San Diego to the tune of $188 million plus interest. Metropolitan is seeking a new trial.

I THINK IT’S PREMATURE FOR CALIFORNIA TO BE GOING DOWN THAT ROAD.
Peter Gleick, Pacific Institute

Kerl said the arrangement with Poseidon gives San Diego greater control over its own destiny. That includes costs. While the contract includes an escalator clause that’s expected to increase prices by as much as 2.5 percent a year, the rate hikes are capped at 30 percent over the 30-year life of the contract. There’s no such cap with Metropolitan, Kerl said.

“With the water with Met, we have no controls, or frankly, influence over what the cost is going to be,” Kerl said.

In addition, between the drought and environmental restrictions in the Sacramento-San Joaquin Delta, Metropolitan’s ability to deliver water from Northern California has become increasingly undependable, San Diego officials say. The area’s population has ballooned to 3.2 million, and Kerl said many San Diegans have keen memories of major supply cutbacks imposed by Metropolitan during the early 1990s drought.

“We’re not ever wanting to be in that position again,” Kerl said. “This is about the long haul.”

Monday’s dedication ceremony is expected to attract dignitaries such as Assembly Speaker Toni Atkins, a San Diego Democrat. Community leaders say the grand opening will shine a light on San Diego’s long-standing efforts to seize the initiative on water issues.

“In the Western Hemisphere, this is the biggest thing to happen in terms of manufacturing water in a long while,” said Jim Madaffer, a public affairs consultant in San Diego and member of the water authority board. “It is more expensive, but it’s the price you pay for water reliability long term.”