I m pleased to see so many familiar faces here today. We are humbled by the interest that you show in your water and wastewater utility.

Transcription

1 Thank you Judge Wolff, and welcome to everyone. I m pleased to see so many familiar faces here today. We are humbled by the interest that you show in your water and wastewater utility. I ve known many of you for many years, professionally and personally. I have also had professional and personal relationships with SAWS staff. As a former legislator and now as President of SAWS, I rely upon their expertise, but I never fully appreciated the job that 1,600 public service employees at SAWS do day in, and day out. I m proud to be among their ranks today, and I hope you are just as proud of the work that we do. 1

2 But perhaps many of you are not as fully aware of the work that is performed at SAWS, so today s address is designed to give you a glimpse of this state-of-the-art utility. At SAWS, our ratepayers are our top priority. We strive to serve you with pride, and to help your neighborhoods, your businesses, and your communities flourish. We accomplish that by efficiently providing plentiful, affordable and high quality water services and supply. We know that above all, what every member of this community wants and expects is a water and wastewater utility that responsibly manages a sustainable supply of water, and delivers that supply in a reliable and affordable way. 2

3 In 1992, the water future of our community was uncertain. San Antonio Water System had just opened its doors, a hybrid of three City departments. At about the same time, a federal lawsuit under the Endangered Species Act threatened the supply available from the Edwards Aquifer, and led to the creation of one of our regulatory agencies, the Edwards Aquifer Authority. This environment contributed to the uncertainty of our water supply. 3

4 Let me take a few moments to familiarize you with some of the innovation and ingenuity that has emerged from SAWS over the past two decades. While the entire State of Texas battles today over the creation of water storage reservoirs to help meet the state s future water needs, we in San Antonio already have our own. I m talking about a San Antonio reservoir that is 4 times as large as Applewhite would have been. It holds three times as much water as you d find in Braunig Lake. 4

5 Aquifer Storage & Recovery Never seen it? It s under ground. It is our Aquifer Storage and Recovery facility in southern Bexar County, and it currently holds one third of our annual potable water demand. When available, we ll pump water from the Edwards, pipe it south, and inject it into the Carrizo aquifer where it is stored for future use. Your investment of $250 million in the Aquifer Storage & Recovery facility allows San Antonio to boast the third largest ASR in the nation. At the same site, we produce fresh water from the Carrizo Aquifer, and we will build our brackish water desalination plant. Three supply sources at one location. 5

6 Water: Charting the Course Since the early 1990 s, SAWS has also developed the largest direct recycled water system in the nation, comprised of 111 miles of purple pipe encircling our city. The wastewater that you send down your drain is treated at our water recycling centers, and reused all over the city. San Antonio Water System November 4,

7 This recycled water is used to assemble Toyota trucks, to cool Microsoft computer equipment, to provide flow in our world-famous Riverwalk, and to irrigate municipal and private golf course all over town. The lights are on in this room today because Recycled Water is also used to help cool CPS power plants in southern Bexar County. Every drop of water that we can reuse is water we don t have to pump from the Edwards or other sources. 7

8 50% More Customers, 0% More Water But the most significant accomplishment that has occurred over the course of the last 20 years is our success in water conservation. As a community, we are pumping the same amount of water we did 20 years ago, despite the fact that our population has increased 50%, or 400,000 people. How is this done? Well, it s not just about drought restrictions. Drought restrictions help us curtail our use, but only in extreme and short-term conditions. Our efforts are much larger than that. 8

9 We have provided almost a quarter million high efficiency toilets to commercial and residential customers. We have retrofitted entire downtown hotels and school districts with high efficiency fixtures. We have worked with businesses large and small to capture condensate and reuse it on landscapes and in cooling towers. We have worked with industries such as Landscaping Irrigation Car Wash Manufacturing Swimming Pool and many others. 9

10 Water Management COMMERCIAL RETROFIT PROGRAM Annual Savings 1 million gallons Annual Savings 43 million gallons Annual Savings 100 million gallons UTSA, for example, replaced water-cooled ice machines with aircooled ice machines, and they are saving this community over 1 million gallons of water every year. Frito-Lay upgraded and retrofitted its production equipment and its facilities. While potato chip production increased by as much as 41%, overall water use decreased by 22%. Frito-Lay is saving this community 43 million gallons of water every year. The Hilton Palacio del Rio is saving nearly 100 million gallons of water per year simply by retrofitting each hotel room with high-efficiency water fixtures. Thanks to ALL our commercial and residential ratepayers, San Antonio leads the nation in water conservation. No other city is better. 10

11 Water Management - Conservation WATER SUPPLY SAVINGS Surface Water $3.3 billion saved Additional Edwards $0.7 billion saved OR Groundwater Desalination $1.9 billion saved OR 1980s 121,000 ac-ft saved 2008 Deferred alternative supplies would have cost up to $3.3 billion And water conservation is not just the right thing to do for our environment. There is a sound business model behind it, too. Our business model is to convince our customers to buy less of our product. Sound confusing? Let me explain. Over the past twenty years, San Antonians have saved over 121,000 acre-feet of water. Had we not saved that water, we would have spent $700 million buying that water from the Edwards to meet demand. or Groundwater desalination would have cost nearly $2 Billion dollars to meet that demand. or a surface supply from a lake or river would have required $3.3 billion dollars to acquire the supplies needed to meet that demand. 11

12 Water Management - Conservation WASTEWATER TREATMENT SAVINGS $12 Per Gallon $1,071 million saved $3.90 Per Gallon $348 million saved OR $7 Per Gallon $625 million saved OR 1980s 89.3 MGD Treatment 2008 Capacity Savings Additional treatment capacity would have cost up to $1.1 billion The less water you use, the less you have to treat. The State of Texas requires that when a wastewater treatment plant starts to reach its capacity, design and construction is not far away. Whether you expand an existing plant, add new technology, or build one from scratch, the cost could easily exceed $1 billion for the wastewater infrastructure required to treat that much water. We ve saved so much water that we actually closed a wastewater treatment plant that was no longer needed. 12

13 Texas Bill Comparison AVERAGE RESIDENTIAL WATER AND WASTEWATER $80.00 $70.00 $60.00 $50.00 $40.00 $30.00 $20.00 $10.00 $0.00 El Paso SAWS 2009 Dallas Ft. Worth Houston Austin Corpus Christi Monthly Bill $34.59 $44.19 $49.88 $54.41 $59.03 $68.87 $70.29 Average based on 7,788 gallons water/ 6,178 gallons sewer usage. As of July 14, Excludes COSA Stormwater. So not only are you saving water, you re also saving energy and money. By saving water, you have kept water and wastewater rates low enough to be among the lowest in the State of Texas. Only El Paso has a lower average residential bill. Just up the road in Austin and down the road in Corpus Christi are the most expensive residential rates in the state. Our low utility rates are among the critically important factors considered by businesses seeking to relocate to San Antonio. 13

14 I m fortunate to have had the opportunity to lead SAWS during the past year and a half. Among our significant accomplishments in that short time was the Update of our 50-year Water Management Plan and our performance during the driest two years in San Antonio s recorded history. I d like to spend the rest of our time together sharing what we see ahead of us in terms of water supply, and what we learned operationally from the two-year drought that we hope has ended. 14

15 First, Water Supply. In May of this year, an internal SAWS Task Force determined that if a repeat of the drought of record were in fact underway, and if we didn t add another drop of water to our current portfolio, San Antonio would be short of supply to meet our growing demand by That s the worst case scenario drought of record and no new supplies. In May, the SAWS Board and City Council accepted the Task Force recommendations and approved the 2009 Water Management Plan. 15

16 I am pleased to announce to you today, that the supply gap of 2014 no longer exists. SAWS has closed that gap, and not just because of recent rains. By the end of this year we will have aquired over 20,000 acre-feet of new Edwards water rights. One afternoon trip to Uvalde resulted in more than 8,300 acre-feet from Governor Dolph Briscoe and his partners. We have done such a good job, that in 2010 we will no longer lease Edwards water. SAWS will only be in the market to buy. 16

17 Annualized Cost of Water $3,500 $3,000 $346 Annualized Cost per Ac-Ft $2,500 $2,000 $1,500 $1,000 $191 $216 $1,924 $335 $2,124 $2,822 $500 $1,175 $0 $283 $324 Edwards Acquisitions Edwards Leases Regional Carrizo Brackish Desal LCRA Ocean Desal Project Integration Edwards water remains the most cost effective supply for our ratepayers. By comparison, other supplies in our Plan will cost 5 to 10 times as much, as you can see in this chart. Continued diversification from the Edwards will still be needed, but we all must recognize that it comes at a significant financial cost. 17

18 In addition to acquiring new supplies, the ongoing success of our Water Management Plan is predicated on one underlying assumption: we must continue to conserve water and achieve the aggressive goal of low water use. Not only must we add supply, but we must continue to curb demand at the same time, especially peak demand. As a community, we need to ask ourselves some serious questions. Do we want to continue to pay low rates for our water and waste water service, or do we want to pay for expensive supplies to water our lawns? 18

19 Water Management RESIDENTIAL CUSTOMERS *Monthly Water Delivery and Water Supply Rates Combined Residential Non-Seasonal That s what it boils down to. The expensive water we need to acquire goes on our lawns. 95% of our residential customers use less than 20,000 gallons per month. 5% use more. Are we willing to pay higher rates, so that 5% of us can have lush, green lawns during the hottest part of the year? Or are we all willing to manage our outdoor irrigation and promote our conservation programs? I think we are. We ve done it for years, and there s no reason to believe we can t keep doing it. Especially since recent rains have shown that our lawns can be green again. The longer we can put off expensive supplies, the better. 19

20 The day will come, however, when growth will outpace conservation and we will begin to see the need for additional supplies. That includes more non-edwards supplies. Toward that end, we are planning for two projects that, within the next five years, will bring our community the largest non-edwards supplies in San Antonio s history. We have an application pending with the Gonzales Underground Water Conservation District for over 11,000 acre-feet of water from the Carrizo Aquifer. 20

21 Texas Blind Salamander And we re planning for a Brackish Desalination Plant in southern Bexar County. Within Bexar County is an ocean of unused, slightly salty groundwater that can be tapped, treated and delivered to our community within 5 years. Combined with our Edwards acquisitions, they will help us meet our demand out to the year 2034, even in a repeat of the drought of record. 21

22 Additionally, we will look to Texas entrepreneurs. In 2010, we will issue a Request for Proposals to bring a groundwater supply to San Antonio. There are numerous private interests within Texas who have water to sell us. 22

23 Through our RFP, we will learn if they have the permits to pump how they plan to acquire the easements for a pipeline and how much it will cost to treat their water and deliver it at the city gate. We will also look at building on our own success. Can we build more underground reservoirs like our current ASR, and how many? 23

24 It sounds like a lot of work, and it is. One of the biggest dilemmas we face is that never before has water been so regulated in the State of Texas, and we all need to stay engaged in the public processes that can have a positive influence on our regulatory environment. Those processes include the EAA s rulemaking, and the next state legislative session. Of course, the EAA, regulates our primary supply. And I would like to recognize their General Manager Velma Danielson and Board Chair Luanna Buckner. All of us are currently involved in a regulatory process that is called the Edwards Aquifer Recovery Implementation Program, or RIP. 24

25 Under this process, stakeholders from across the Edwards Region are working to determine, scientifically, how much spring flow is required to sustain the human and environmental needs of this region. We all need to be cognizant of the developments of the RIP process, and make our voices heard for the benefit of our community and region. In addition, this community and region need to begin discussion of the development of EAA rules on brackish desalination and aquifer recharge. 25

26 The next legislative session promises to be shaping up as an historic session for water. Of priority to this community will be the reauthorization of the Texas Water Development Board because of the role it can play in actually curtailing the over-regulation of ground water in our state. 26

27 Groundwater Conservation Districts This map depicts the proliferation of groundwater conservation districts that has occurred in Texas mostly over the last ten years. While the state has mandated that we plan for water on a regional basis, groundwater districts have taken a parochial and protectionist approach to water supply. This over-regulation of ground water is not good for the state because it means that water cannot be moved from where it is, to where it s needed. We recognize that the movement of water happens only if there is a willing buyer and a willing seller. But today, even willing buyers and sellers are hindered. 27

28 And finally, there is one more regulatory challenge that merits thorough discussion by this community. The state will soon contemplate requirements for river flow, known as environmental flows, to maintain the ecological needs of our rivers. And while SAWS recycled water has long contributed to the improvement of flow and water quality in the San Antonio River, new requirements may have an impact on our recycled water supply. Suzanne Scott, the General Manager of the San Antonio River Authority, and her Chairman Tom Weaver, are with us today. I look forward to working with her on this critically important issue. 28

29 And that brings me to the final part of my discussion with you today. We can t forget that even with a 50-yr plan, we have to be able to deliver that water to your tap and treat it when goes down your drain. The basic service of a public water system is a critical component of our city s infrastructure, if not the most critical. 29

30 The past two years ending in August has taught us much about working under the most operationally stressful conditions. As a result, we have begun to analyze the impact of the last two years of drought, and in particular, the effectiveness of our drought ordinance and how it can be improved. We will take a close look at the Stages of drought restrictions. Did it take too long to enter Stage 1? Did it take too long to exit? Did we need to be in Stage 2 at all? 30

31 But it is reasonable to expect that extreme conditions will require some kind of short term demand management. The benefits are clear - this summer alone we were able to save an estimated 24,000 to 30,000 acre-feet of water compared to the summer of 2008 without drought restrictions. And through it all, businesses had all the water they needed for production and jobs. Water was never restricted for that important purpose. 31

32 Some of our lawns got brown and went dormant, no doubt. But our community has demonstrated it is willing to let its grass go brown when extreme conditions require it. If you ask our neighbors in the region, they appreciated our efforts in San Antonio. With us today is Sandra Narvais, the Mayor of San Marcos, and Bill Powers, a Board Member from the Guadapule Blanco River Authority. I m sure it would be difficult for them to imagine a regional drought in which San Antonio was not doing its part to help manage the Edwards aquifer. 32

33 We are also close to concluding a study of our rate structure. A committee of citizens from across the community has deemed water conservation to be the #1 priority in examining our rate structure. As a result, we will be proposing a new rate structure to our Board and City Council early next year that will likely make low water use more affordable, and high water use more expensive. All of this conservation through programs conservation through drought restrictions conservation through the rate structure will be essential to our operations in the future. 33

34 Responded to 1,045 calls. And speaking of operations, we also learned that during times of extreme drought, we will experience more main breaks. This summer, we fought water main breaks and leaks like never before. In July alone our crews responded to a record 1,045 leak repairs, usually in 100+ degree weather. All of this activity was on top of the work we normally perform every day at your utility. 34

35 Crews cleaned over 880 miles of sewer line. You can help them out this holiday season and throw your leftovers in the trash, not down the drain. Just like fats, oils and grease will clog your arteries, they will clog your sewer lines, too. So don t feed the Grease Monster. 35

36 And these guys on the screen, these guys swam in waste to repair a deteriorating sewer main that threatened the San Antonio River. None of us would want that job. I d like to recognize the people who make these basic services possible in San Antonio. At this table are representatives from each of the 12 departmental groups at SAWS. Please give these hard-working employees a hand. 36

37 Over the next five years, San Antonio Water System s capital spending in this community will exceed $1.5 Billion. That is no small contribution to our local economy, and doesn t even include the $200 million it takes to operate SAWS every year. The investment you are making in water, waste water, and water supply infrastructure will provide tangible benefits and value for generations to come. 37

38 Never before has SAWS been tested on its ability to provide essential, life-sustaining services as we were over the last two years ending in August. Our supply was tested our customer service was tested our drought ordinance was tested and indeed our entire community s tolerance of drought was tested. 38

39 I m enthusiastic and proud to report that we passed those tests with hard work, smart planning, and city-wide cooperation. Despite some brown lawns, no one can deny that our community has flourished. On behalf of our Board of Trustee and the 1,600 public service employees at SAWS, thank you for the opportunity to be a part of your success. 39