Desal Agreement Makes Chumps of Monterey Peninsula Ratepayers

The Monterey Peninsula: “Water, water every where, Nor any drop to drink.”

When a deal to finance and run a major water project is worked out in secret and only revealed to the public two days before Easter weekend, with the Board of Supervisors scheduled to approve it the following Tuesday (i.e. today), you can pretty much bet that someone is getting a bad deal.

In this case, that someone appears to be the Cal-Am ratepayers of the Greater Monterey Peninsula. Is the Monterey Peninsula scared enough of the State Water Resources Control Board Cease and Desist Order to accept any deal – no matter how unfair? There are people who apparently think so.

Click here to see what the California Public Utilities Commission’s Division of Ratepayer Advocates says about the deal.

Among the problems the DRA and others have noticed are the fact that Cal-Am ratepayers will be asked to pay at least three times the going rate for desalted water, that there will be no incentive for the plant operators to hold costs down (their Ft. Ord and Marina customers will pay a set fee far lower than the expected cost of desalting the water and that fee won’t go up no matter how high costs climb – while total costs will be passed straight through to Cal-Am ratepayers without the usual need to justify expenses to the PUC), that Cal-Am ratepayers will be expected to subsidize the cost of desalting water for Ft. Ord, Marina and points north, and that those same Monterey Peninsula ratepayers will be expected to pay all costs of litigation (the first lawsuit has already been filed).

For more specifics on the problems with this deal, see this excellent Coast Monterey County Weekly article.

What fascinates us most, though, are the problems created by pumping water from the Salinas Valley groundwater basin.

The plan is to pump brackish water from below the dunes. Because this water is less salty than the ocean it will be easier to desalt. But the reason it’s less salty is that it’s mixed with fresh water flowing down the Salinas Valley. This water, having already begun to mix with ocean water, isn’t usable to anyone in the Salinas Valley, but it does belong to them and cannot be transferred out of the basin. This means that the operators of the project must calculate how much of the water they pump started out as Salinas Valley, rather than ocean, water and return that same amount of water to users in the Salinas basin (which includes Ft. Ord and Marina).

The fact that, under the deal, Salinas basin users will get this water at much less than the actual cost of desalting it (the difference to be paid by the Cal-Am ratepayers, of course) is one problem. But the really interesting thing is a clause in the contract that states that for the first five years the amount of water coming from the Salinas basin will be deemed to not exceed 15%. In other words, no more than 15% of the fresh water produced will be returned to the Salinas basin regardless of how much actually came from there.

This clause allows project proponents to pretend both that there’s a cap on the amount of water Cal-Am ratepayers will have to pay to desalt for  Ft. Ord, Marina and Salinas Valley users, and that the amount of water that will actually be delivered to the Monterey Peninsula for the first five years is relatively certain.

If, as most people close to the project seem to think, the actual percentage proves to be higher than 15%, Salinas basin water users will certainly sue over the illegal diversions. Cal-Am ratepayers will then pay the costs of the lawsuit and, after the court rules that Salinas basin users are entitled to their full 20% or more of the water, pay most of the cost of desalting that water for them – all while the Peninsula receives less water than it was expecting.

But don’t complain about the deal too loudly. The proponents have made it clear that only no-growthers out to sabotage any and all solutions to the Peninsula’s water problems could possibly object.


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