The Water Authority has improved water supply reliability through diversifying supplies, investing in infrastructure like reservoirs and pipelines, and promoting conservation. However, challenges remain like regulatory restrictions limiting State Water Project deliveries, rising water costs, and ongoing litigation regarding the Quantification Settlement Agreement.

1. San Diego County
Water Authority
y
2010 Update
1

2. Presentation Overview
Water Authority background
Water reliability strategy
Supply diversification
Capital Improvement Program
Budget and rates
Key water issues
Supply challenges
MWD rates
QSA liti ti
litigation
2

3. 3

4. What Is the Water Authority?
Wholesale water agency
g y
created by State Legislature in
1944
24 member agencies
membe
36-member board of directors
Se es 3.2
Serves 3 million peop e a d
o people and
region’s $174 billion economy
Service area
950,000 acres
97% of county’s population
4

5. Who Provides Your Water?
Individual customers
served by local retail Local Water Agencies
water agency Camp
Pendleton
Lakeside WD City of
Poway
Santa Fe
ID
Water Authority Carlsbad
MWD
National City* Rainbow
MWD
South Bay
Irrigation
secures supplies from District*
outside the region for City of Del
Mar
City of
Oceanside
Ramona
MWD
Vallecitos
WD
24 local agencies
City of Olivenhain Rincon Del Valley
6 cities Escondido MWD Diablo Center
14 water/utility districts MWD MWD
Fallbrook Otay Water City of San Vista ID
3 irrigation districts PUD District Diego
1 military base Helix WD Padre Dam San Yuima
MWD Dieguito MWD
WD
* Member of the Sweetwater Authority
5

6. Sources of San Diego County’s Water Supply
LAKE
SHASTA
San Diego County
LAKE imports ~80% of its
OROVILLE
water supply
State Water Project
(Bay-Delta)
30%
Colorado River
50%
Local Supplies
and Conservation
20%
6

7. Imported Water Sources
Colorado Ri
C l d River S
Supplies
li State Water Project Supplies
Department of Interior California Department of
Bureau of Reclamation Water Resources
All-American and
Coachella Canal
Lining Projects
Priority 1: Palo Verde
Irrigation District State Water Project
Contractors (27)
Priority 2: Yuma Project
Metropolitan Water District of
Priority 3 I
P i it 3:a Imperiali l Southern California
Irrigation District
26 Other Contractors
Priority 4 and 5a:
Metropolitan Water District
of Southern California
San Diego County Water Authority
24 Local Retail Agencies and cities

8. Supply Diversification
Capital Improvement Program
8

9. Drought Headlines from 1990-91
9

10. Response to Crisis: Long-Term
Strategy to Improve Reliability
Diversify supply sources
Imported (transfers, canal lining projects)
Local (groundwater, seawater desalination,
l( d d li i
conservation, recycling)
$3.8 billi
$3 8 billion capital improvement program
it l i t
Improve regional water delivery, storage and water
treatment
10

11. Regional Water Supply Diversification
g pp y
1991 2010 2020
5% 10%
6%
3% 4% 7% 11%
16% 3%
4%
95% 6%
6%
10%
10%
9%
23%
50% 22%
Metropolitan Water District Conservation (2005 UWMP Goal)
Imperial Irrigation District Transfer SBX 7-7 Additional Conservation Increment
All American & Coachella Canal Lining Seawater Desalination
Dry-Year Water Transfers
y Local Surface Water
Recycled Water
Groundwater 11

12. Q
Quantification Settlement Agreement
g
Colorado River QSA Supplies
Q pp
Imperial Irrigation District transfer
200,000 acre-feet*/year for 45 to 75
years
Canal-lining projects
C l li i j t
80,000 acre-feet**/year for 110 years
Key to supply diversification
strategy Canal-lining project
C l li i j t
Provide 165,000 acre-feet in 2010, help
mitigate current shortage
By 2021 will provide 30% of
2021,
region’s supply
Lining the Coachella Canal
*At full implementation in 2021
** Acre-foot = 325,900 gallons
12

13. Groundwater and Recycled Water
Recycled Water
28,000
28 000 af/year today growing to
today,
52,000 af/year by 2020
High-quality, drought-proof water
supply
17 agencies in San Diego produce
recycled water
Primarily used for landscaping irrigation
Groundwater
13,000 f/
13 000 af/year t d
today, growing t
i to
53,000 af/year by 2020
San Diego does not have significant
underground storage basins
Brackish groundwater must be
Sweetwater Authority’s groundwater
desalinated
desalination plant
Six local agencies have groundwater
projects
13

14. Conservation
Comprehensive water
conservation programs
programs,
incentives and school
programs since 1990s
65,000
65 000 af/year today
today,
growing to 94,000+ by
2020
Cumulative savings: more
C l ti i
than 600,000 AF
Water efficient planting and rotating nozzle
Shifting emphasis
g p
from indoor to
outdoor conservation
14

15. Seawater Desalination
Carlsbad Desalination Project
Produce up to 56,000 acre-feet annually
Approved term sheet that will lead to
water purchase agreement to buy output
p g y p
of plant
Camp Pendleton Project
56,000
56 000 to 168,000 af/year
168 000
Feasibility studies under way
Bi-national Desalination Project
Encina Power Station, Carlsbad h d
In conjunction with agencies in Nevada,
Arizona and Mexico
Studying site in Baja California
15

16. Capital Improvement Program
$3.8 billion CIP (1989 – 2030)
$1.5 billion Emergency Storage Program (ESP)
Dozens of major projects – completed or under
construction
2010 debt issuance of $627 million to continue
funding CIP
Olivenhain Reservoir and Lake Hodges 16

17. Water Treatment Plant
Located in Twin Oaks Valley
y
Treat 100 million gallons per
day
Meet needs for up to 220,000
households
Enables di t ib ti during
E bl distribution d i
emergencies
Completed 2008
p
17

18. Olivenhain Dam and Reservoir
Olivenhain Dam, Reservoir and Pump Station Completed in 2003
p
Region’s first major
new dam in 50 years
24,000 AF of storage
18

19. Lake Hodges Projects
Connects Hodges to
imported water system
i t d t t
Provide 20,000 AF of
water storage for
emergency use
Generate up to 40 MW
of electricity
Enough for 26,000 homes
Lake Hodges Pump Station
Completion Date: Late-
2010/Early 2011
19

20. San Vicente Pipeline
11-mile pipeline
8.5-foot diameter
pp
pipeline
Connects San
Vicente Reservoir to
regional aqueduct
system
Complete late-2010
Tunnel entrance preparation for pipe installation
20

21. San Vicente Dam Raise
Raise dam height by
117 feet
Increase reservoir
capacity by 152,000
acre feet
acre-feet
Largest dam raise in
United States
Complete early 2013
Total project cost:
$568 million
21

22. Artist’s rendering: San Vicente Dam Raise
22

23. 23

24. Water Rates
$ $$ $$$ $$$$
Colorado River State Water Spot Water
p Loss of Sales
Water Project Transfers (Shortage)
<2003 2003-2007 2008> Now
Supply challenges make securing water more expensive
Shift to more-expensive supplies is driving up the cost of water
from MWD, the Water Authority’s largest supplier
Water Authority passes increased costs to member agencies
Member (retail) agencies pass costs to ratepayers
Lower sales increasing unit cost ($/af) of water
24

25. Water Authority Rates 2011
Water Authority Board d t d
W t A th it B d adopted CY 2011 rates
t
following public hearing in June
Treated water rate – up 11.3% ($1,026/AF)
11 3% ($1 026/AF)
Untreated water rate – up 14.7% ($811/AF)
Primary drivers of rate increases:
y
Costs to purchase, deliver imported water
Costs for operating, maintaining and financing regional
water system
t t
25

26. Cost of Water Drives Treated
Water Rate* Increases
“All-in” Increase
All-in Water Authority Melded Supply
Distribution Rate Increase
$104/AF $65/AF
MWD
Transportation
p 75%
8% ($49)
($8)
Storage
21%
($22)
Customer
Service Supply
9% 62%
($9) ($65)
Water Authority
25%
($16)
*Municipal and Industrial Rate
26

27. Wholesale Monthly Cost of Water
to Households
Estimated CY 2011
Wholesale Costs per Household *
p
Cost of water purchases is
62.7% of the wholesale cost of
water
MWD Costs $23.70
$23 70 62.7% is the
h
Cost of Water For an estimated $16.04/month
the Water Authority:
IID/QSA Costs $3.26 Delivering water and maintaining
Water Authority
the system
$4.09
Operating Costs
Rapidly diversifying the region’s
Water Authority 37.3% is Water water supplies
$11.95 Authority Costs
Capital Costs
Providing in-region emergency
water storage
TOTAL: $43/month
* Based upon 0.5 AF of consumption a year
Developing in-region water storage
D l i i i t t
capacity
27

28. Mitigating Rate Impacts –
Water Authority Actions
Current budget eliminated more than a dozen
positions
$2.4M reduction made mid-year in FY 2010 &
2011
Reduction in spot water purchases
Rate stabilization draw – up to $10.7M
$10 7M
MWD rate challenge
Lawsuit challenging MWD’s rates and how they’re
allocated
28

29. Supply Challenges
MWD Rates
QSA Litigation
29

30. Supply Challenges
pp y g
Regulatory restrictions
Fish protections limit State
Water Project deliveries
j
Lingering effects of
drought
Storage still recovering Lake Oroville – April 2010
Effects of climate change
30

31. Bay-Delta Pumping Restrictions
y p g
Delta smelt
Central Valley
steelhead
Longfin smelt
Banks Pumping Plant
Green sturgeon Chinook salmon
State Water Project
31

32. How Restrictions Limit Deliveries from
the Bay Delta
Bay-Delta
Regulatory Pumping Restrictions
JAN FEB MAR APR MAY JUN JUL AUG SEP OCT NOV DEC
Salmon
S l
Delta Smelt
Longfin Smelt
32

33. Supply Challenges
pp y g
Regulatory restrictions
g y
Fish protections limit State
Water Project deliveries
Lingering effects of
drought
Lake Oroville – April 2010 Storage still recovering
Heading into another dry
winter? (La Niña?)
Effects of climate change
33

34. Response to Supply Challenges
p pp y g
Water Shortage and
Drought Response Plan
Implementation
8% regional target
beginning July 1, 2009
1
Target in effect through
June 30, 2011
30
34

35. Region Succeeding in Saving Water
September 2009 - August 2010
Acre-feet Urban W t U *
U b Water Use*
18%
below
600,000 FYs
FY 08/09
602,300 11%
below
550,000 FYs 09/10
552,100
552 100
500,000
493,100
450 000
450,000
400,000 2007/08 2008/09 2009/10
*12-month periods overlap two fiscal years. 35

36. San Diego County: 1991 vs 2010
vs.
$174
$1026
3.2 1.3
578 $323 2.5 1.08 $65 566
1991 2010
Water use (thousand acre-feet) Population (millions)
Cost of water per acre-foot (full
p ( Jobs (millions)
( )
service treated water rate)
Gross Domestic Product (billions)
36

37. MWD Rate Challenge
Water Authority filed it i J
W t A th it fil d suit in June against MWD
i t
over its 2011-2012 rates
Violates California law, standard practices
law
MWD improperly overcharges for transporting
water through its facilities
g
MWD improperly subsidizes the price of water it
sells
37

38. MWD Misallocating Its Costs
38

39. Impacts to Local Ratepayers
*Based on 600,000 AF annual sales; 2021 figure includes
$40B Delta fix share
39

40. Impacts on Supply Reliability
By disguising true cost
of i
f imported water,
t d t
MWD discourages local
supply development
Disincentive to
pursuing conservation
and local supply
projects
Disincentive to
transfers that require
use of MWD’s facilities
Desalination membranes These kinds of projects
help protect region
from supply shortages
40

41. QSA Litigation
January 2010: Superior Court ruling invalidated 13
y p g
agreements
Includes IID transfer and canal-lining agreements
Ruling based on single sentence in one agreement
State’s obligation to fund
Salton Sea mitigation found
unconstitutional
Water Authority and other
agencies appealed ruling
Temporary stay allowing
transfers to continue
Decision expected in 2011
p
All-American Canal 41

42. Co t u g Challenges
Continuing C a e ges
Achieving Bay Delta fixes
Bay-Delta
that restore reliability
Rising water rates
g
Sustaining new water use
ethic
Resolving MWD and QSA
disputes
p
Water bond timing/passage? Bay-Delta waterways
42

43. Summary
Region has significantly improved
water supply reliability over
past two decades
Supply diversification is working
Regional shortage level is lower because of diversified
supply
Historic investments in major regional water
infrastructure
$1.5 billion Emergency Storage Project protects region
following natural disaster
Long-term strategy and investment protects region
for generations to come
43

44. Questions
San Diego County Water Authority
Speakers Bureau Requests & Information
speakersbureau@sdcwa.org
(858) 522-6708
522 6708
44