Down Under Desalination Debacle – Stop OCWD from importing bad water policy and raising our rates

Special Report by Dave Hamilton
Residents 4 Responsible Desalination

In the southeastern Australian state of Victoria, residential water rates were the US-equivalent of $620 per acre-foot in 1999. Those rates have increased to $2,715 per acre-foot in 2014—more than a 4-fold increase in 15 years.

Why? Australian inflation rates have been about the same as those in the U.S. So, why? The primary reason—if not the sole reason—is the multi-billion dollar Wonthoggi seawater desalination plant built on the coast near Melbourne.

The sad irony of this is the Wonthoggi plant is not producing potable water. The water it would produce would cause water rates to be even more than they are at $2,715 per acre-foot—an estimated 20% higher. Australians are paying for a huge seawater desalination plant that sits idle.

The woeful Wonthoggi episode does not stand alone. There are four other examples in Australia, as well as examples in Spain, Cyprus, Catalina, and Santa Barbara. And Santa Barbara is about to do a repeat of its plant built and mothballed in the early-90s—but this time 5-times as costly.

Why do I bring this up? Huntington Beach’s water suppliers are about to repeat these episodes here and soon. Orange County Water District (OCWD) is “investigating” the purchase of the entire production of desalinated water from the proposed Poseidon Water facility in Huntington Beach. So far, OCWD’s “investigation” is nothing short of a sham. A process that is opaque to the public, done under the purview of Poseidon non-disclosure agreements, and conducted by Poseidon-approved consultants.

OCWD’s process of investigation included a financial analysis by Clean Energy Capital—the same consultant that did a like analysis for the San Diego County Water Authority (SDCWA) for its purchase of desalinated water from Poseidon’s Carlsbad plant (to be operational in late 2015—maybe). According to SDCWA latest estimates, product water cost from the Carlsbad plant will near $2,400 per acre-foot. Yet Clean Energy Capital is predicting a product water cost of $1,922 per ac-ft. from Poseidon’s proposed HB plant, which will be more costly to build than Poseodon’s Carlsbad project—quite a bookkeeping trick.

R4RD’s comments on this sleight-of-hand financial report can be found on the OCWD website at:
http://ocwd.com/Portals/0/ProgramsProjects/Explore%20Desal/R4RDCommentsOnCECReport_20141121.pdf

Similarly, the HB public Works Dept. contributed comments on the Clean Energy Capital financial report and can be found at:
http://ocwd.com/Portals/0/ProgramsProjects/Explore%20Desal/HuntingtonBeachComments_20141124.pdf

Other comment letters—some rather scathing—can also be found on OCWD’s website.

R4RD is bringing all this to your attention because the Australian debacles are about to be replicated here—unless we collectively show our opposition to OCWD’s actions.

To those that say, “It won’t happen here.” Just do the comparison: Our current water cost is about $700 per ac-ft. for a combination of 70% groundwater (managed by OCWD) and 30% imported water (from Metropolitan Water District of southern California—called MWD, or “MET”) while desalinated ocean water will cost, perhaps, $2,400 per ac-ft. or more—much more. Seem familiar?

Overall, Poseidon might be considering this a done deal. The only thing possibly standing in the way is public opposition. The way to show such opposition is for citizens to attend OCWD Board and associated meetings. The OCWD Board has the process well under way. Nonetheless, OCWD is a public agency, so the Board is obligated to respond to public will. That “will” may be expressed at Board meetings on the 1st and 3rd Wednesdays of each month at 5:30 PM at 18700 Ward St. (Ward & Ellis) in Fountain Valley. Unfortunately, we do not know if Poseidon is on the agenda until 3 days before each meeting.

However, we do know the Poseidon deal is the only thing on the agenda for a joint workshop of the OCWD Board and the Groundwater Producers (GWPs) to be held Wednesday, December 10th at 8:00 AM at 18700 Ward St. in Fountain Valley. This meeting is very important to attend. Please be there.

Poseidon will most probably be the dominant item on the OCWD Board agenda for the meeting on Wednesday, January 7, 2015 at 5:30 PM at Ward & Ellis. Please plan to attend. Because of the Board’s lack of transparency and underhandedness, our call outs to you and the public are subject to us “crying wolf”. Please forgive us for possible false alarms, the stakes are high and the risk of a false alarm can easily be outweighed by the impact of your presence.