- Email: [email protected]
Financing groundwater desalination in Southern California
Desalination, 87(1992)175-180
175
Elsevier Science Publishers B.V., Amsterdam
Financing groundwater desalination in Southern California ANDREW SIENKIEWICH Principal Engineer, The Metropolitan Water District of Southern California, 111 I Sunset Boulevard, Los Angeles, CA 900540153
SUMMARY The Metropolitan Water District of Southern California (Metropolitan) has embarked on a large-scale program to improve regional water supply reliability through reclamation of groundwater degraded by minerals and other contaminants.
Under
its new Groundwater Recovery Program (GRP), Metropolitan will provide financial assistance to local agencies to recover up to
200,000 acre-feet
(AF) per year of contaminated groundwater.
Over
40 projects costing Metropolitan $30 to $40 million per year are expected by the year 2000.
GRP will encourage reclamation from
more than 16 million AF of mineral degraded groundwater known to exist in Southern California.
INTRODUCTION Set in a semi-arid climate, Southern California has adopted a mix of progressive water supply approaches.
These
include extensive groundwater development including enhancement of yield through artificial groundwater recharge, large scale importation of water to the region through aqueduct systems, reclamation of wastewater, urban conservation, and transfers of agricultural water saved by conservation.
Metropolitan
currently supplies about half of the region's water needs 001 I-9164/92/$05.00
8 1992 Elsevier Science Publishers B.V. All rights reserved
176 through wholesale deliveries of water imported from the Colorado River and California's State Water Project to its 27 member public agencies.
Because good quality local water sources have
been nearly fully developed, local agencies typically look to Metropolitan to meet the water needs of new growth.
However,
regional population increases of about 300,000 per year are out-pacing development of imported water supplies, which in some cases have actually diminished because of various court decisions.
Six years of drought have resulted in recent
shortages and mandatory rationing for 15 million residents.
GROUNDWATER RECOVERY PROGRAM One approach to improving water supply reliability is reclamation of the 16 million acre-feet of mineral degraded groundwater known to exist in Southern California.
However, the
high cost of desalination, is not competitive with the region's traditional alternative supply which is purchased imported water from Metropolitan.
For example, Metropolitan's treated
noninterruptible water rate will be $322 per acre-foot in July
1992,
while projects that desalt brackish groundwater typically
cost $600 to $800 per acre-foot.
Hence in 1991, Metropolitan
adopted a new Groundwater Recovery Program (GRP) to bolster water supplies by making desalination financially attractive.
Under the GRP, Metropolitan offers financial subsidies equal to those project costs which exceed Metropolitan's basic water service rate, up to a maximum contribution of $250 per AF. The contribution is revised annually to reflect changing water rates and project costs.
Projects are developed and operated
by local agencies which must enter into an agreement with Metropolitan to receive assistance.
177
QUALIFYINGCRITERIA Only those projects requir ing financ ial assistance and providing regional benefits as defined in the following criteria are eligible for GRP assistance: Contaminated Groundwater - Projects must recover groundwater that is contaminated under California health standards. Project Costs - Project costs must exceed Metropolitan's noninterruptible water rate.
Location of Water Service - Product water must be used for domestic and municipal service in Metropolitan's service area.
However, groundwater may be pumped from basins
outside of the service area.
Groundwater Production Rates - Participants must increase annual groundwater production by the stated project yield. Three Years of Sustained Production - Projects must include sufficient storage reserves to sustain production during a three-year drought without receiving replenishment service from Metropolitan. Sound Basin Manaqement - Projects must be consistent with sound basin management. California Environmental Quality Act (CEOA) - Projects must comply with CEQA. FINANCIAL ASSISTANCE
Financial assistance is provided by an unique yieldpurchase arrangement, whereby Metropolitan buys the product water at the project cost in dollars per acre-foot and simultaneously
178 sells it back to the project owner at Metropolitan's water service rate.
The difference between the buy and sell values constitutes
the GRP contribution.
Project cost, on a per acre-foot basis is
calculated annually using documented capital and operation and maintenance expenditures and actual production values.
Under this
procedure, Metropolitan invests in the development of local water supplies for the regional good in a manner similar to investing in an incremental expansion to its imported system.
Some agencies
are considering projects which even with GRP assistance will cost more than buying Metropolitan's water.
Those extra costs may be
justified by: improved local water supply reliability; deferred costs of transmission and storage facilities needed for the use of imported water; and enhanced basin management and cleanup.
PROGRESS
As of May 1992, the five projects listed below were approved for GRP participation:
Aoencv City of Oceanside City of Tustin Irvine Ranch Water District City of Santa Monica West Basin Municipal Water
Project
Yield (AFY)
Cost (S/AF)
Desalter Desalter Desalter VOC Plant Desalter
2,000 3,200 6,700 1,800 1.500
508 584 800 355 622
Total
15,200
PROJECTION FOR THE FUTURE As Metropolitan's water rates increase, more expensive projects are expected to become cost effective when the GRP contribution is considered.
For example, in the year 2000 projects
costing $850 per acre-foot would be eligible for 5250 per acre-foot contributions making them cost effective compared to Metropolitan's projected water rate of about $600 per acre-foot.
Annual program
contributions of $30 to $40 million are anticipated to support
179 development of about 40 new groundwater treatment projects developed over the next eight years.
Figure One illustrates
expected participation on a fiscal year basis.
GROUNDWATER
RECOVERY
PROGRAM
PARTICIPATION WAF 1,500
1,000
5ocl
-I
0
7191
7192
7193
7194
7195
7t96
7197
7196
7199
6/00
FISCALYEARS .
..
1 GRP MAXIMUM S25O/AF COKTRIBUTION
-
COSTS FOR 40 PROJECTS
CONJUNCTIVE USE Historically, Southern California's groundwater basins have been effectively utilized to store imported and local water to deal with seasonal and multi-year imbalances of supply and demand. Metropolitan has recognized the value of such conjunctive-use practices through a long standing policy of discounting imported water rates to encourage groundwater replenishment and storage. The GRP pursues conjunctive-use a step further through reclamation of valuable, but contaminated groundwater basin storage.
About
one-half of the GRP production is expected to require groundwater
180 replenishment service from Metropolitan or perhaps reclaimed wastewater to maintain long-term hydrologic balance.
Typically,
imported water would be stored in these basins during periods of abundance through spreading, injection or in-lieu practices and then reliably produced through a GRP subsidized treatment plant during shortages.
Hence, the GRP will improve regional water
supply reliability through a conjunctive-use strategy.
The
remaining half of the GRP production is expected to develop untapped, naturally replenished local yield.
BENEFITS
In summary, GRP participation during its first year has been strong and a high level of participation is expected to continue.
The primary benefit is improved regional water supply
reliability.
GRP also provides ancillary basin clean-up and
containment benefits related to contaminated groundwater plumes.
Presented Desalting
at the National Water Supply Improvement Association 1992 Biennial Conference and Recycling, August 23-27, 1992, Newport Beach, CA, USA
175
Elsevier Science Publishers B.V., Amsterdam
Financing groundwater desalination in Southern California ANDREW SIENKIEWICH Principal Engineer, The Metropolitan Water District of Southern California, 111 I Sunset Boulevard, Los Angeles, CA 900540153
SUMMARY The Metropolitan Water District of Southern California (Metropolitan) has embarked on a large-scale program to improve regional water supply reliability through reclamation of groundwater degraded by minerals and other contaminants.
Under
its new Groundwater Recovery Program (GRP), Metropolitan will provide financial assistance to local agencies to recover up to
200,000 acre-feet
(AF) per year of contaminated groundwater.
Over
40 projects costing Metropolitan $30 to $40 million per year are expected by the year 2000.
GRP will encourage reclamation from
more than 16 million AF of mineral degraded groundwater known to exist in Southern California.
INTRODUCTION Set in a semi-arid climate, Southern California has adopted a mix of progressive water supply approaches.
These
include extensive groundwater development including enhancement of yield through artificial groundwater recharge, large scale importation of water to the region through aqueduct systems, reclamation of wastewater, urban conservation, and transfers of agricultural water saved by conservation.
Metropolitan
currently supplies about half of the region's water needs 001 I-9164/92/$05.00
8 1992 Elsevier Science Publishers B.V. All rights reserved
176 through wholesale deliveries of water imported from the Colorado River and California's State Water Project to its 27 member public agencies.
Because good quality local water sources have
been nearly fully developed, local agencies typically look to Metropolitan to meet the water needs of new growth.
However,
regional population increases of about 300,000 per year are out-pacing development of imported water supplies, which in some cases have actually diminished because of various court decisions.
Six years of drought have resulted in recent
shortages and mandatory rationing for 15 million residents.
GROUNDWATER RECOVERY PROGRAM One approach to improving water supply reliability is reclamation of the 16 million acre-feet of mineral degraded groundwater known to exist in Southern California.
However, the
high cost of desalination, is not competitive with the region's traditional alternative supply which is purchased imported water from Metropolitan.
For example, Metropolitan's treated
noninterruptible water rate will be $322 per acre-foot in July
1992,
while projects that desalt brackish groundwater typically
cost $600 to $800 per acre-foot.
Hence in 1991, Metropolitan
adopted a new Groundwater Recovery Program (GRP) to bolster water supplies by making desalination financially attractive.
Under the GRP, Metropolitan offers financial subsidies equal to those project costs which exceed Metropolitan's basic water service rate, up to a maximum contribution of $250 per AF. The contribution is revised annually to reflect changing water rates and project costs.
Projects are developed and operated
by local agencies which must enter into an agreement with Metropolitan to receive assistance.
177
QUALIFYINGCRITERIA Only those projects requir ing financ ial assistance and providing regional benefits as defined in the following criteria are eligible for GRP assistance: Contaminated Groundwater - Projects must recover groundwater that is contaminated under California health standards. Project Costs - Project costs must exceed Metropolitan's noninterruptible water rate.
Location of Water Service - Product water must be used for domestic and municipal service in Metropolitan's service area.
However, groundwater may be pumped from basins
outside of the service area.
Groundwater Production Rates - Participants must increase annual groundwater production by the stated project yield. Three Years of Sustained Production - Projects must include sufficient storage reserves to sustain production during a three-year drought without receiving replenishment service from Metropolitan. Sound Basin Manaqement - Projects must be consistent with sound basin management. California Environmental Quality Act (CEOA) - Projects must comply with CEQA. FINANCIAL ASSISTANCE
Financial assistance is provided by an unique yieldpurchase arrangement, whereby Metropolitan buys the product water at the project cost in dollars per acre-foot and simultaneously
178 sells it back to the project owner at Metropolitan's water service rate.
The difference between the buy and sell values constitutes
the GRP contribution.
Project cost, on a per acre-foot basis is
calculated annually using documented capital and operation and maintenance expenditures and actual production values.
Under this
procedure, Metropolitan invests in the development of local water supplies for the regional good in a manner similar to investing in an incremental expansion to its imported system.
Some agencies
are considering projects which even with GRP assistance will cost more than buying Metropolitan's water.
Those extra costs may be
justified by: improved local water supply reliability; deferred costs of transmission and storage facilities needed for the use of imported water; and enhanced basin management and cleanup.
PROGRESS
As of May 1992, the five projects listed below were approved for GRP participation:
Aoencv City of Oceanside City of Tustin Irvine Ranch Water District City of Santa Monica West Basin Municipal Water
Project
Yield (AFY)
Cost (S/AF)
Desalter Desalter Desalter VOC Plant Desalter
2,000 3,200 6,700 1,800 1.500
508 584 800 355 622
Total
15,200
PROJECTION FOR THE FUTURE As Metropolitan's water rates increase, more expensive projects are expected to become cost effective when the GRP contribution is considered.
For example, in the year 2000 projects
costing $850 per acre-foot would be eligible for 5250 per acre-foot contributions making them cost effective compared to Metropolitan's projected water rate of about $600 per acre-foot.
Annual program
contributions of $30 to $40 million are anticipated to support
179 development of about 40 new groundwater treatment projects developed over the next eight years.
Figure One illustrates
expected participation on a fiscal year basis.
GROUNDWATER
RECOVERY
PROGRAM
PARTICIPATION WAF 1,500
1,000
5ocl
-I
0
7191
7192
7193
7194
7195
7t96
7197
7196
7199
6/00
FISCALYEARS .
..
1 GRP MAXIMUM S25O/AF COKTRIBUTION
-
COSTS FOR 40 PROJECTS
CONJUNCTIVE USE Historically, Southern California's groundwater basins have been effectively utilized to store imported and local water to deal with seasonal and multi-year imbalances of supply and demand. Metropolitan has recognized the value of such conjunctive-use practices through a long standing policy of discounting imported water rates to encourage groundwater replenishment and storage. The GRP pursues conjunctive-use a step further through reclamation of valuable, but contaminated groundwater basin storage.
About
one-half of the GRP production is expected to require groundwater
180 replenishment service from Metropolitan or perhaps reclaimed wastewater to maintain long-term hydrologic balance.
Typically,
imported water would be stored in these basins during periods of abundance through spreading, injection or in-lieu practices and then reliably produced through a GRP subsidized treatment plant during shortages.
Hence, the GRP will improve regional water
supply reliability through a conjunctive-use strategy.
The
remaining half of the GRP production is expected to develop untapped, naturally replenished local yield.
BENEFITS
In summary, GRP participation during its first year has been strong and a high level of participation is expected to continue.
The primary benefit is improved regional water supply
reliability.
GRP also provides ancillary basin clean-up and
containment benefits related to contaminated groundwater plumes.
Presented Desalting
at the National Water Supply Improvement Association 1992 Biennial Conference and Recycling, August 23-27, 1992, Newport Beach, CA, USA