Posted on 21 February 2013.
By John Earl
Surf City Voice
A growing number of county ratepayers, inspired by the late Gus Ayer, and opposed to a plan by Poseidon Resources Inc. to build an ocean desalination plant in Huntington Beach, have a message for the Municipal Water District of Orange County (MWDOC) and its 28 member agencies:
No more secret negotiations or deals with Poseidon and don’t make us pay an additional $5 billion in local water bills—$8,500 per ratepayer—over the next 30 years for water that we don’t need.
Thirty-years is the time period in which the water agencies that contract with Poseidon would be required to pay for Poseidon’s desalinated water, whether it is needed or not, according to the water purchase agreement (WPA) made public by MWDOC in January.
The buyers “will agree to take (on a ‘take if delivered’ basis) [56,000] acre-feet per year of Product Water (the ‘Committed Amount’),” the WPA states. And if the buyers don’t take that amount of water, they will, “nonetheless pay Seller a per-acre foot charge to be set forth in the Contract…”
The WPA is not final, but it is the culmination of a decade-long relationship between MWDOC, its water agencies, and Poseidon.
The opposition group, heralding online as www.nowaterdeal.com, plans to spend tens-of- thousands of dollars to inform other ratepayers in high propensity voting areas of the county about Poseidon’s proposed “take or pay” contract, asking them to urge their local elected officials not to sign it.
Nowaterdeal is a coalition of members of Residents for Responsible Desal and other local ratepayers, including members of the Surfrider Foundation, League of Conservation Voters, and Orange County Coastkeepers, who at least until now had been fighting an uphill battle against Poseidon’s well financed lobbying efforts and a marketing campaign (largely unquestioned in the county’s major daily newspaper) that depicts its desalination plant as a future fallback point in case of prolonged drought or a natural disaster that would disrupt the flow of water to the public.
Poseidon would risk private investor flight without the guaranteed income, but take or pay would be risky for ratepayers if, as happened in drought drenched Australia, if the desalination plant were to sit idle due to lack of need. Currently, the Metropolitan Water District of Southern California (MWD), which sells water to MWDOC, has more surplus water stored up now (enough for 2.5 years) than ever before—testament to the ability to create backup reliability water without Poseidon.
Ocean desalination’s high maintenance and construction costs—and much higher energy costs—make it too risky, nowaterdeal says. Stuck with higher water rates and an idle desalination plant, ratepayers would fall into a rate trap. “As rates go up, people use less water” and “lower demand results in even higher rates, with fixed costs of the entire system spread over fewer units of water.”
Gus Ayer: MWDOC is pimping for Poseidon and should be eliminated. Photo: John Earl
The high cost-prediction is from information provided by Poseidon in the WPA and factors in conveyance and maintenance costs. With an inflation rate of 3.5 percent factored in, that means an estimated cost of $1,795 per acre foot for the desalinated water, compared to $285 per acre foot for local groundwater and $835 per acre foot for imported water, nowaterdeal says.
Acknowledging the higher cost of desalination, Poseidon VP Scott Maloni recently told the OC Register that Orange County residents have to ask, “What is the value of that reliability to them?”
But the underlying push for desalination plants along the California coast by the desalination industry and other development related business interests is not about drought relief alone, as MWDOC/MWD director Brett Barbre pointed out at a recent MWDOC committee meeting.
Barbre supports the Poseidon project and a smaller, less controversial, desalination project envisioned (but far from certain) for Dana Point in south Orange County. He also thinks that ratepayers throughout the county should have to pay for both projects on the basis that they would benefit everyone, even in water districts that say they don’t want or need the water.
“I believe that desal is not only for reliability. It’s also for growth,” he said. “And there are folks on the environmental side who don’t want any growth and they think if you don’t build water projects you can conserve your way to provide enough water for everybody. And that’s not ever going to happen.”
Although most of Poseidon’s opponents have always been concerned about the environmental effects of ocean desalination, the main focus of their current campaign is economic, while advocating for the development of proven and much cheaper water sources, including the Orange County Water District’s (OCWD) groundwater replenishment system, capturing rainwater, and conservation.
To start, the group will focus on about 50,000 voters in 14 north county cities, including Anaheim, Brea, Buena Park, La Palma, Orange, Newport Beach, Santa Ana, Seal Beach, Tustin and Westminster.
Twenty Orange County water agencies had signed non-binding letters of intent or memorandums of understanding with Poseidon to purchase, cumulatively, over 80,000 acre feet of water each year. Since those non-binding agreements expired in June, 2011, not a single agency has yet to renew.
Correction 02/05/2013: Eighteen agencies have signed Letters of Intent that have no expiration date, according to Karl Seckel, MWDOC’s acting General Manager. Those agencies, with the exception of Fullerton, are slated to participate in “working group discussions” regarding Poseidon during the 2012 fiscal year. Four other agencies are participating in working group discussions but have not signed LOIs. Participation in working group discussions is contingent upon signing a confidentiality agreement with Poseidon, but not all agencies that signed an LOI signed that agreement. The MOUs, which one presumes carried more weight, have all expired.
As Poseidon works to form an agreement with MWDOC and its member agencies, it requires all parties involved in project discussions to pledge absolute secrecy at Poseidon’s whim.
That lack of transparency and the overall elitist/exclusionary attitude at MWDOC and other OC water agencies, including their secret and arguably illegal meetings with Poseidon–all observed by a growing number of citizen spectators at water board meetings, as well as the company’s financial support of an ethically challenged hit piece in the recent Huntington Beach City Council campaign, have inspired Poseidon’s opponents, not only to challenge its political hegemony with a renewed vigor but to question the nature of Orange County water management as whole.
A temporary setback occurred for nowaterdeal when its chief strategist, former Fountain Valley mayor Gus Ayer, a master at crafting successful political campaigns in Orange County, died last week.
Earlier in the month, at a recent joint meeting of MWDOC and OCWD, Ayer praised the latter for its groundwater replenishment program and overall good management, but accused MWDOC of “mission creep” and “pimping for Poseidon.”
He also questioned whether MWDOC should exist.
“It’s time for OCWD to take a very close look at taking over these [MWDOC’s redundant] functions and eliminating MWDOC,” he said. Ayer expanded on that theme in a column written just before his death and published in the Surf City Voice.
Ayer’s untimely death saddened his colleagues but his upbeat attitude continues to motivate them.
“Gus’s last words to me were ‘Give them hell’”, recalled former Huntington Beach mayor Debbie Cook, who, during the past two years, has actively campaigned for greater transparency in water management.
“That was his way of saying that, if we don’t participate in democracy, we deserve the inevitable results. Nobody can replace our friend’s skill set, but he sparked a fire that emboldens us to carry on.”