Presenta

1. Carlsbad Seawater Desalination
Project Status Report
Water Planning Committee
July 26, 2012
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2. Today's Status Report on Carlsbad
Desalination Project
1. Status of WPA Negotiations
2. Status of Due Diligence Activities
3. Other Project Related Issues
4. Upcoming Board and Other Public Meetings
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3. Status of Negotiations for a Water Purchase
Agreement
 Final Draft Agreement under production
 All major deal points and key provisions previously reviewed by Board
Advisory Group
 Commercial terms
 Economic terms
 Resizing of minimum annual commitment to 48 TAF included in final draft
 Technical appendices near completion
 Due Diligence status
 Finalizing financial pro-forma assumptions to reflect terms and conditions
of Draft WPA
 Poseidon finalizing price for construction and operations based on Water
Authority direction
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4. Other Carlsbad Desalination Project Related
Issues
 Bond and Financing Process Advancing
 Draft documents prepared and under review
 Ensure Project is investment grade
 BBB- or better
 July 26th Water Planning Committee
 Energy Pricing Workshop
 SWRCB development of intake and discharge guidelines for seawater
desalination at July 26 Water Planning
 Draft Design Build Agreement for conveyance pipeline being
developed
 Pricing for improvements at Twin Oaks WTP under discussion
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5. Other Carlsbad Desalination Project Related
Issues (Continued)
 Incorporation of Carlsbad desalination into rates and charges
 Presented workshop information to member agency managers
 Meet again with member agency managers and finance officers in August
 Return to Board at August meeting with information item on alternatives
and member agency comments
 Contracts with member agencies for purchase as local supply
 Meeting scheduled with interested member agencies on July 31st
 Provide draft Water Authority – Member Agency agreement in August
 60 day member agency review period begins with distribution of Draft
WPA
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6. Upcoming Meetings
 August 9th Board workshop
 Overview of Key Provisions in Draft WPA
 Assignment of risk to the parties
 Detailed discussion on pricing
 August Regular Board Meeting
 Continue discussion on incorporation into rates and charges
 Presentation on desalination and supply reliability
 Update on member agency local supply planning
 September Regular Board Meeting
 Continue discussion on key provisions of Draft WPA
 Review actions related to Pipeline 3 rehabilitation, Twin Oaks and other
distribution system activities
 September Public Meetings (Two)
 Evening Water Planning Committee meeting in Carlsbad
 Evening Water Planning Committee Meeting in Kearny Mesa
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7. Water Planning Committee Meeting
July 26, 2012

8. Current State Water Resources Control
Board Regulatory Framework
 State Water Board regulates ocean intakes and
discharges
 Intakes (California Water Code)
 Discharges (NPDES permit and Ocean Plan)
 Ocean Plan does not specifically address desalination
nor does it have a salinity objective
 Current regulations address desalination impacts
 Carlsbad desalination project was fully permitted under
existing regulatory structure
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9. Proposed Ocean Plan Amendment
 SWRCB has initiated a process to amend the ocean
plan to specifically address desalination projects
 Identified as very high priority in Triennial Review
 On-going planning for multiple ocean desalination facilities
 Proposed components of amendments
 Narrative objective for salinity (specific % over
background)
 Provisions to minimize marine life impacts
 Implementation provisions
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10. State Water Board Amendment Process
 Public meetings on the process held to date
 Stakeholder Meeting - April 18, 2011
 CEQA Scoping Meeting - March 30, 2012
 State Board initiated a series of technical scientific
studies to address information gaps related to
proposed amendments
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11. Scientific Studies
1. Salinity Toxicity Studies
 “Preliminary final draft” released on July 16, 2012
2. Expert Panel on Intake Impacts and Mitigation
 Public meeting on November, 2011
 Final report released March 14, 2012
3. Expert Panel on Impacts and Effects of Brine
Discharges
 Public meetings on July 5 and December 8-9, 2011
 Final draft released March 2012
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12. Key Concerns Identified to Date
 Overall concerns
 Proposed amendments need to recognize site-specific nature
of projects
 Intake
 Expert panel conclusions generally consistent with Carlsbad
permits
 State Board acknowledges that not all technologies are
feasible or cost effective at every site
 Brine discharge
 Salinity toxicity study findings generally concur with Carlsbad
permit findings
 Statewide salinity objective not appropriate
 Not based on site characteristics, including species tolerances
 Proposed amendments need to allow flexibility to use different
salinity mitigation strategies
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13. Public Involvement
 Stakeholder engagement
 Water Authority
 CalDesal
 Desalination agencies
 Environmental groups
 Poseidon Resources
 Technical studies review under way
 CalDesal agencies and experts reviewing to identify
specific concerns
 Comment letters to the Board will be prepared
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14. Schedule and Next Steps
 Public Workshop on August 22nd in Sacramento
 Present findings of scientific studies
 Public comments
 Public review draft and comment period
 Public hearing before State Water Board
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