CONSERVATIOCONSERVATIONN

Three Retail ViewsThree Retail Views

Southern California Water Southern California Water DialogDialog

July 23, 2008July 23, 2008

Peer SwanPeer Swan

ConservationConservation

Conservation has different effects Conservation has different effects depending on the location of the depending on the location of the conserving districtconserving district

Closed BasinClosed Basin

Upper WatershedUpper Watershed

Lower WatershedLower Watershed

ConservationConservation

BMP 11 requires that at least 30% of BMP 11 requires that at least 30% of fixed costs be recovered from the fixed costs be recovered from the variable water charges with limited variable water charges with limited exceptions.exceptions.

This is a major disincentive for retail This is a major disincentive for retail agencies to promote conservation. If agencies to promote conservation. If they overly successful, then they they overly successful, then they will lose money.will lose money.

Closed Basin AgencyClosed Basin Agency Examples – Kern, Mojave, Palm SpringsExamples – Kern, Mojave, Palm Springs

Landscape – Evaporation and Landscape – Evaporation and Transpiration (ET) losses, remaining Transpiration (ET) losses, remaining recharges closed basin but increases salt recharges closed basin but increases salt levels in basinlevels in basin

Indoors – Waste causes increased Indoors – Waste causes increased treatment facilities and operational costs treatment facilities and operational costs but recycled water recharges basin but recycled water recharges basin (limited losses) but increases salt(limited losses) but increases salt

Closed Basin AgencyClosed Basin Agency

Strategy:Strategy: Landscape – adopt budget based tiered Landscape – adopt budget based tiered

rate structure to encourage smart use, rate structure to encourage smart use, remove salt from water being recycled remove salt from water being recycled and sequester it, use penalty revenue to and sequester it, use penalty revenue to encourage SMART irrigation controllersencourage SMART irrigation controllers

Inside - adopt budget based tiered rate Inside - adopt budget based tiered rate structure to encourage smart use, use structure to encourage smart use, use penalty revenue to replace inefficient penalty revenue to replace inefficient devicesdevices

Upper Watershed AgencyUpper Watershed Agency Examples – Riverside, Fresno, Three ValleysExamples – Riverside, Fresno, Three Valleys

Landscape – ET loss only unless Lower Landscape – ET loss only unless Lower Watershed in not able to capture excess Watershed in not able to capture excess runoffrunoff

Inside - Waste causes increased treatment Inside - Waste causes increased treatment facilities and operational costs but recycled facilities and operational costs but recycled water recharges watershed (limited losses) water recharges watershed (limited losses) unless lower watershed is unable to capture unless lower watershed is unable to capture flowflow

Upper Watershed AgencyUpper Watershed Agency

Strategy:Strategy: Landscape – adopt budget based tiered rate Landscape – adopt budget based tiered rate

structure to encourage smart use, use penalty structure to encourage smart use, use penalty revenue to encourage SMART irrigation revenue to encourage SMART irrigation controllers, shade heat islands with trees controllers, shade heat islands with trees lowering ET, replace unneeded grass areas and lowering ET, replace unneeded grass areas and other high water using plantsother high water using plants

Inside - adopt budget based tiered rate structure Inside - adopt budget based tiered rate structure to encourage smart use, use penalty revenue to to encourage smart use, use penalty revenue to replace inefficient devices and encourage re replace inefficient devices and encourage re landscapinglandscaping

Recycle enough wastewater for use down Recycle enough wastewater for use down watershed moving SALT towards a salt sink. Use watershed moving SALT towards a salt sink. Use enough recycled water locally to prevent its loss enough recycled water locally to prevent its loss to a salt sink.to a salt sink.

Lower WatershedLower Watershed Examples – Long Beach, Huntington Beach, Examples – Long Beach, Huntington Beach,

Contra Costa, Santa MonicaContra Costa, Santa Monica

Landscape – After ET excess usage flows to Landscape – After ET excess usage flows to the Pacific or other salt sink and is lost the Pacific or other salt sink and is lost frequently causing environmental violations frequently causing environmental violations in the receiving watersin the receiving waters

Inside – Waste causes increased treatment Inside – Waste causes increased treatment facilities and operational costs. Large flows facilities and operational costs. Large flows lost to the Pacific Ocean. Limited recharge.lost to the Pacific Ocean. Limited recharge.

Lower WatershedLower Watershed

Strategy:Strategy: Landscape – adopt budget based tiered rate Landscape – adopt budget based tiered rate

structure to encourage smart use, use structure to encourage smart use, use penalty revenue to encourage SMART penalty revenue to encourage SMART irrigation controllers, shade heat islands with irrigation controllers, shade heat islands with trees lowering ET and replace unneeded trees lowering ET and replace unneeded grass areasgrass areas

Inside - adopt budget based tiered rate Inside - adopt budget based tiered rate structure to encourage smart use, use structure to encourage smart use, use penalty revenue to replace inefficient devicespenalty revenue to replace inefficient devices

Maximize use of recycled wastewater, desalt Maximize use of recycled wastewater, desalt a portion of recycled water to keep SALT a portion of recycled water to keep SALT balance, send salt to ocean.balance, send salt to ocean.

Budget Based Rate Budget Based Rate StructuresStructures

All fixed costs recovered in a fixed chargeAll fixed costs recovered in a fixed charge Develop a fair allocation and a appeals Develop a fair allocation and a appeals

processprocess Use penalty revenue to finance added Use penalty revenue to finance added

conservationconservation Refund penalty revenue to those who fix Refund penalty revenue to those who fix

problemsproblems Tighten allocations during extended in Tighten allocations during extended in

shortagesshortages Insure significant differences in each tierInsure significant differences in each tier

SALTSALT

Unaddressed will significantly Unaddressed will significantly increase cost of groundwaterincrease cost of groundwater

Water systems should constantly be Water systems should constantly be moving SALT towards a salt sink moving SALT towards a salt sink (Pacific Ocean, Salton Sea)(Pacific Ocean, Salton Sea)

Salt has significant economic Salt has significant economic impacts both on our appliances and impacts both on our appliances and our healthour health

ObstaclesObstacles

MWD - over 80% of its cost is fixed so MWD - over 80% of its cost is fixed so lower sales cause higher rates which lower sales cause higher rates which effectively penalize consumers for effectively penalize consumers for conserving – need to move fixed costs to conserving – need to move fixed costs to a tax rate like many other wholesalersa tax rate like many other wholesalers

Poor public and regulatory perception of Poor public and regulatory perception of recycled waterrecycled water

Poor acceptance of tiered rate Poor acceptance of tiered rate structures by governing boards / structures by governing boards / councilscouncils

Improved OperationsImproved Operations

Currently most agencies base load off their Currently most agencies base load off their groundwater resources (lowest cost) and groundwater resources (lowest cost) and float on their imported supplies (highest float on their imported supplies (highest cost). This practice unnecessarily lowers cost). This practice unnecessarily lowers groundwater levels going into a dry period groundwater levels going into a dry period and leaves large amounts of available water and leaves large amounts of available water in wet years to go unused and pressures in wet years to go unused and pressures fragile ecosystems for supplies during dry fragile ecosystems for supplies during dry years. Re-operating the systems increases years. Re-operating the systems increases yields and lowers impacts during dry yields and lowers impacts during dry periods at no long term increased periods at no long term increased operational costoperational cost

Other ObservationOther Observation

We use significant amounts of water to We use significant amounts of water to produce rice, cattle feed, dairy and meat produce rice, cattle feed, dairy and meat productsproducts

These products also generate very large These products also generate very large amounts of greenhouse gas – most not amounts of greenhouse gas – most not counted as it is considered part of the natural counted as it is considered part of the natural carbon cyclecarbon cycle

Might it be possible to solve two of our Might it be possible to solve two of our problems by somewhat adjusting our problems by somewhat adjusting our diet?diet?

Questions?Questions?