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Home My WebLink About2011/07/19 Regional Water Presentation by Frank BelockCity of Chula Vista July 19, 2011 Dennis A. Cushman Assistant General Manager San Diego County Water Authority 2 2 Metropolitan Water District Imperial Irrigation District Transfer All American & Coachella Canal Lining Conservation Seawater Desalination Local Surface Water Recycled Water Groundwater 2011 (Allocation Year) Population 3.16 mil 2020 Goal Population 3.41 mil 1991 Population 2.49 mil 552 TAF (95%) 285 TAF (47%) 250 TAF (29%) 80 TAF (13%) 72 TAF (12%) 78 TAF (9%) 52 TAF (6%) 20 TAF (3%) 26 TAF (5%) 94 TAF (11%) 90 TAF (10%) 60 TAF (7%) 53 TAF (6%) 190 TAF (22%) 75 TAF (12%) 28 TAF (5%) 51 TAF (8%) Total = 578 TAF Total = 611 TAF (includes conservation savings) Total = 867 TAF (includes conservation savings) Improving imported water supply reliability Imperial Irrigation District Transfer – 200,000 AF/Y Canal Lining Projects – 80,000 AF/Y Local supply development Conservation $3.8 billion Capital Improvement Program to enhance infrastructure Improve regional storage, including emergency storage Improve delivery system New pipelines, pump stations and related facilities Renowned pipeline relining program Expand region’s water treatment capacity Canal lining projects in the Imperial Valley 4 The amount of money the Water Authority sent to MWD last year: $241,000,000 The amount of money at dispute in the Water Authority’s rate lawsuit vs. MWD (over 45 years): $1,300,000,000 - $2,100,000,000 5 6 Estimated CY 2012Wholesale Costs per Household * Payments to MWD for water and transportation comprise 55% of the wholesale cost of water Water Authority Costs 34.7% MWD is Biggest Driver of Water Rates TOTAL: $48/month * Based upon 0.5 AF of consumption a year QSA Water Supplies 8.6% Since 2006, MWD approved rate increases totaling 75 percent MWD rates projected to continue rising Supply challenges key driver of MWD rates MWD’s flawed rate structure overcharges the Water Authority for wheeling transfer supplies 7 -29% +75% MWD Sales Decline & Rate Increases80% of MWD’s revenues come from water sales 8 Engaged at board, management and staff levels Advocating cost containment, CIP deferrals and other budget reductions Opposed 2010 Integrated Resources Plan and overdevelopment of supplies Plan to develop up to 500,000 AF/Y of unneeded “buffer” supplies at a cost of billions of dollars Opposing unnecessary supply project expenditures Opposed FY 12 & FY 13 budgets Suing MWD over its misallocation of rates 9 Challenging MWD’s rate structure in court MWD misallocates supply costs to transportation rate categories Overcharging $31 million in 2011 Long-term overcharges: $1.3 billion to $2.1 billion Superior Court decision late-2011or early 2012 10 Case assigned to San Francisco Superior Court Judge Kramer Case has been designated as “complex” Assigned to single judge for all purposes Complex cases generally get more attention/resources from the judge Next case management conference is 8/30/11 Estimate trial court decision in mid-2012 Appeal likely 11 1991 2011 12 Two-Year 2010 & 2011 budget reductions $2.4 million cut in FY 2010 $3.6 million cut in FY 2011 Reduction in spot water purchases: $1.7M Selling stored water: $700,000 Rate stabilization draw: up to $10.7M Capitalizing interest: $3.5M Debt service coverage below target Consistent with 2010 Bonds Official Statement Deferred 14 CIP projects: $150 million Reducing staff 12% since 2008 Further reductions in FY 12/FY 13 budget 13 14 +70% +6-9% Higher priority water than MWD water under the Colorado River priority system Guaranteed additional water supply for up to 75 years from the Imperial Irrigation District and 110 years from the All American and Coachella canal lining projects IID and Canal Lining Deliveries 2003-2021 15 16 17 18 *Includes all estimated debt service payments on senior and subordinate issuances 19 Project: All American & Coachella Canal Lining Projects Complete: 2010 (AAC) and 2006 (CC) Cost: $452 million total, including $198 million from Water Authority Benefits: 80,000 AF/Y for 110 Years 20 Project: Olivenhain Dam & Reservoir Complete: 2003 Cost: $198 million Benefit: 24,000 AF of storage 21 Project: Lake Hodges Projects Complete: 2011 Cost: $196 million Benefits: 20,000 AF ESP storage; 40MW of power 22 Project: Twin Oaks Water Treatment Plant Complete: 2008 Cost: $179 million Benefit: 100 MGD advanced membrane treated supply for region 23 Project: San Vicente Tunnel & Pipeline System Complete: 2011 Cost: $459 million Benefit: Improved Water Delivery 24 Project: Pipeline Relining Program Complete: Ongoing Cost: $787 million Benefit: Extend the life of 82 miles of large-diameter imported water pipeline by 75 years 25 26 San Vicente Dam Today San Vicente Dam After Construction 27 San Vicente Reservoir After Fill 28 Snowpack: 165% of average on April 1, the historic peak date Storage as of 7/5/11: Lake Oroville: 3.5 MAF (full) versus 2.7 MAF year earlier Diamond Valley Lake: 780 TAF (full) versus 435 TAF year earlier 80% State Water Project Allocation for 2011 WY2011 precipitation to date: 126% of normal Projected WY2011 runoff into Lake Powell: 16.68 MAF (139% of normal) Projected April-July 2011 runoff into Lake Powell: 12.60 MAF (159% of normal) Total System Contents: 6/26/2011: 36.37 MAF (61%) Last Year: 34.68 MAF (58%) Lake Mead elevation expected to rise 45-50 feet this year due to improved hydrology. 34 The Water Authority has long advocated that MWD obtain firm contractual commitments from its 26 member agencies for new spending programs. MWD’s answer? “…to date, most of our board members have said ‘we’re not so sure about that.’ And, most of our member agencies have said ‘No. Thanks, but no thanks, because we prefer this the way it is.’” “Should people make those firm commitments going into the future? So far, the member agencies have opted not to. They prefer it the way it is.” -- Excerpts of remarks by MWD General Manager Jeffrey Kightlinger, speaking at an August 10, 2010 public meeting in San Diego on MWD’s draft 2010 Integrated Resources Plan (IRP). 35 36 Average MWD Water Purchases by Member Agency (2000-09) 37 15 member agencies buy less than 2% of MWD’s water and pay less than 2% of MWD’s bills 20 member agencies buy less than 5% of MWD’s water and pay less than 5% of MWD’s bills One member agency buys more than 25% of MWD’s water and pays more than 25% of MWD’s bills 38 The way it is: Water and Voting Rights also Disconnected from Payments Water Authority striving to provide reliable water supply for region’s $186 billion economy, 1.3 million full-time jobs, and the quality of life for 3.1 million people Water Authority needs a reliable supply from MWD, at an affordable and equitable cost Water Authority needs a fiscally sustainable MWD With sound fiscal policies, stable revenues and that respects ratepayers 39 Over past two decades: Achieved major water supply diversification Secured 280,000 AF/YR of long-term reliable new imported supplies (QSA) Reduced reliance on MWD by 50% Achieved sustained water conservation Invested billions in new, major water supply infrastructure Vastly improved water supply reliability to protect region’s $186 billion economy and quality of life for 3.1 million people 40 Water Purchases and Treatment 46% Labor and Benefits 5% CIP and Debt Service 46% 41 Increase of $104/AF over 2010 rates Drivers of rate increase: 62% higher water supply costs 30% increased facilities investments 8% increased operations costs Includes litigation costs: Challenging MWD’s rates Defending the Quantification Settlement Agreement IID Transfer supplies Canal lining supplies 42 43 2011 2020 1991 552,000 285,000 250,000 San Diego County Water Supply Diversification 44 Population 2.49 mil Population 3.16 mil Population 3.41 mil 1991=<1% Total = 578,000 AF Total = 611,000 AF (includes conservation savings) Total = 867,000 AF (includes conservation savings) 1991 2000-2013 2020 Major CIP Investments Since 1991 Pipe Relining Regional Water Storage 45 Several hundred million dollars invested since 1991 17 active non-potable recycling projects countywide >10 MGD brackish groundwater desalting Diversification efforts continue Recycled water and groundwater supplies to double by 2020 Seawater desalination Carlsbad Camp Pendleton Rosarito Beach Indirect Potable Reuse Local supplies to provide 30% of the region’s water supply by 2020 46 47 Comprehensive, multi-decade investment in water conservation Together with member agencies, instilled sustained water conservation ethic throughout region 2007-2009: enhanced, multi-million-dollar mass communications campaign 20-Gallon Challenge 2011: 72,000 AF of conservation savings $3.8 billion Capital Improvement Program (CIP) $1.5 billion Emergency Storage Project New and expanded surface storage Water treatment Pipelines Pump stations Power generation Aqueduct Protection Program Pipeline relining program 48 Project: San Vicente Dam Raise Complete: 2013 Cost: $482 million Benefit: 152,000 AF of new storage 49 50