Settlement Reached on Desal Plant Return Water

A broad group of stakeholders including agricultural and environmental groups, water agencies and policy leaders, submitted a settlement agreement to the California Public Utilities Commission today, concerning what many have described as the last remaining obstacle to obtaining consensus on California American Water’s proposed future water supply project for the Monterey Peninsula.

The settlement addresses the “return water” that will be produced at the company’s proposed desalination plant. The project will draw seawater from beneath the ocean floor, pulling in a small percentage of groundwater in the process. The project proponents have committed to “return” the amount of groundwater drawn from the project to the Salinas Valley Groundwater Basin to meet applicable requirements of the Monterey County Water Resources Agency Act. Under the terms of the settlement, the return water will be delivered to the Castroville Community Services District, whose current groundwater supplies have been impacted due to seawater intrusion.

The arrangement was made public earlier this year when the parties to the agreement released a draft term sheet. Today’s filing formalizes that plan and brings with it new signatories, including the Monterey Peninsula Water Management District and Monterey Regional Water Pollution Control Agency, the two groups leading a recycled water project that will contribute 3,500 acre feet of water a year to the Monterey Peninsula under Cal Am’s future supply plan.

A final water purchase agreement between California American Water and the Castroville Community Services District will be included in the filing. The filing comes approximately one month before the State Water Resources Control Board is set to consider postponing a cutback order on pumping from the Carmel River, the area’s primary source of water, in light of recent progress made toward a replacement supply.

“The plan we’ve set forth to solve the Peninsula’s water supply crisis has been in development for many years,” said California American Water president Rob MacLean. “During that time, we’ve worked closely with stakeholders and have made adjustments in order to address their concerns. It’s been a careful, considered process and the outcome arrived at today is one I feel confident the State can support as it reflects California’s vision for a sustainable water future.”

By delivering the return water to the Castroville Community Services District, the $322 million Monterey Peninsula Water Supply Project will help to address broader regional water supply concerns, improve operational efficiency in the existing Castroville Seawater Intrusion Project which provides recycled water for crop irrigation, and provide a source of supply to an economically disadvantaged community.

“The return water settlement embodies many of the state’s water policy directives,” said Monterey County Water Resources Agency general manager Dave Chardavoyne. “Efficient reuse of water, regional cooperation and assisting communities in need are central aspects of this agreement.”

The Monterey Peninsula Water Supply Project additionally reflects key points of the State Water Resources Control Board’s recent Ocean Plan through its use of subsurface intakes and exploration of alternative energy and energy-saving technology. The project’s primary objective is to benefit the environment by reducing pumping from the Carmel River, home to threatened species.

“We understand that in asking the state for more time to satisfy the terms of its cutback order, we need to show broad support and considerable progress,” said Monterey Peninsula Regional Water Authority president and Pacific Grove Mayor Bill Kampe. “Today’s filing accomplishes both objectives. From the beginning, the protection of the Salinas Valley Groundwater Basin has been source of major concern for the many groups engaged in this project. To see this question now resolved, and added to previous settlements regarding the brine discharge, intake technology, financing, and so many other aspects of this project, shows we have come together to solve our water shortage.”

In April a separate agreement was announced to reduce pumping from the Carmel River in the period before the desalination plant is built by retiring irrigation to the a portion of the Rancho Canada golf course in Carmel Valley. That agreement, which will add an estimated 1,000 acre feet of water back into the river over three years, won support for a delay in river cutbacks from the Sierra Club and the Planning and Conservation League. Supporters of the return water settlement filed today include LandWatch Monterey County, the Planning and Conservation League, the Coalition of Peninsula Businesses, Monterey County Farm Bureau and Salinas Valley Water Coalition.

“Water issues can be tough,” said Monterey County Farm Bureau Executive Director Norm Groot. “But when you have parties committed to working together and identifying solutions, real progress is made. It’s time to rethink Monterey County’s reputation as a community where water problems go unsolved. Through the efforts of many, we’re leading the way in water conservation and innovative projects to address the needs of industry, the community and the environment.”

Salinas Valley Water Coalition president Nancy Isakson also praised the agreement. “Without Castroville’s participation, the issue of groundwater extraction from the Salinas Valley would go unresolved,” she said. “By working together, Castroville and the Peninsula are helping each other address their water issues and needs. This is truly a win-win. We’re glad to see a beneficial solution reached to a critical issue, the protection of the groundwater basin.”

The return water agreement will not be legally effective until a Final Environmental Impact Report for the water supply project is certified and other approvals obtained, which is expected to occur near the end of this year. For more information on the Monterey Peninsula Water Supply project, visit www.watersupplyproject.org.

“The level of regional cooperation seen through this agreement is truly to be commended,” said Castroville Community Services District board president Ron Stefani. “Working together, we’re finding ways to conserve and beneficially use every drop of water, while helping to replenish our natural resources. It’s a model for other communities and we’re proud to be a part of it.”

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