SB 610 Water Supply Assessment. I-1 Hudson Ranch Power II Geothermal Project, Simbol Calipatria Plant II, SB 610 Combined Water Supply Assessment

Transcription

1 I SB 610 Water Supply Assessment I-1 Hudson Ranch Power II Geothermal Project, Simbol Calipatria Plant II, SB 610 Combined Water Supply Assessment

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3 I-1 Hudson Ranch Power II Geothermal Project, Simbol Calipatria Plant II, SB 610 Combined Water Supply Assessment

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5 HUDSON RANCH 2 GEOTHERMAL PROJECT SIMBOL CALIPATRIA PLANT 2 SB 610 COMBINED WATER SUPPLY ASSESSMENT PREPARED FOR: HUDSON RANCH POWER II LLC P.O. BOX 2387 EL CENTRO, CA and SIMBOL, INC KOLL CENTER PARKWAY, SUITE 213 PLEASANTON, CA PREPARED BY: PANGAEA LAND CONSULTANTS, INC LA MIRADA DRIVE, SUITE H VISTA, CA PHONE: CONTACT: RICH BRASHER MARCH 15, 2012

6 Table of Contents TABLE OF CONTENTS 2 TABLES 3 FIGURES 4 EXECUTIVE SUMMARY 5 BACKGROUND OF THE PROJECTS 7 DESCRIPTION OF THE PROJECTS 7 BASIS FOR A WATER SUPPLY ASSESSMENT 30 SECTION 1 DOES SB 610 APPLY TO THE PROPOSED DEVELOPMENT? 30 SECTION 2 WHO WILL PREPARE THE SB 610 ASSESSMENT? 30 SECTION 3 HAS AN ASSESSMENT ALREADY BEEN PREPARED THAT INCLUDES THIS PROJECT? 31 SECTION 4 IS THERE A CURRENT URBAN WATER MANAGEMENT PLAN (UWMP)? HAS THIS PROJECT ALREADY BEEN THE SUBJECT OF AN ASSESSMENT? IS THE PROJECTED WATER DEMAND FOR THE PROJECT ACCOUNTED FOR IN THE MOST RECENT UWMP?31 SUPPLY VERIFICATION 32 SECTION 5 WHAT INFORMATION SHOULD BE INCLUDED IN AN ASSESSMENT? 32 SECTION 5, STEP ONE: DOCUMENTING WHOLESALE WATER SUPPLIES 32 SECTION 5, STEP TWO: DOCUMENTING SUPPLY TO IID (THE WHOLESALE WATER SUPPLIER) 32 SECTION 5, STEP TWO: DOCUMENTING SUPPLY IF GROUNDWATER IS A SOURCE 39 SECTION 5, STEP TWO: DOCUMENTING SUPPLY IF THE ASSESSMENT RELIES ON WATER SUPPLIES NEVER BEFORE USED 45 PROJECT DEMAND ANALYSIS 47 SECTION 5, STEP THREE: DOCUMENTING PROJECT DEMAND (PROJECT DEMAND ANALYSIS) 47 DETAILING EXISTING AND PLANNED FUTURE USES 47 SECTION 5, STEP FOUR: DOCUMENTING DRY YEAR(S) SUPPLY 68 CONSIDER THE SUPPLIES AVAILABLE DURING NORMAL, SINGLE DRY, AND MULTIPLE DRY WATER YEARS DURING A 30 YEAR PROJECTION 68 SECTION 5, STEP FIVE: DOCUMENTING DRY YEAR(S) DEMAND 78 PROJECTED IID WATER SUPPLIES DURING 30 YEAR PROJECTION INCORPORATING PROJECT BUILD OUT 78 SECTION 6 IS THE PROJECTED WATER SUPPLY SUFFICIENT OR INSUFFICIENT FOR THE PROPOSED PROJECT? 82 SECTION 7 IF THE PROJECTED SUPPLY IS DETERMINED TO BE INSUFFICIENT 84 SECTION 8 FINAL SB 610 ASSESSMENT ACTIONS BY LEAD AGENCY 85 REFERENCES 86 APPENDIX 87 Pangaea Land Consultants, Inc. 2

7 Tables Table 1: Seven-Party Agreement for Apportionment and Priorities 34 Table 2: Issued Permits Summary 35 Table 3: Colorado River Water Delivery Agreement 38 Table 4: Imperial County Population Projections (Imperial County General Plan) 53 Table 5: Imperial County Population Projections (US Census) 54 Table 6: IID Rainfall History 55 Table 7: Water Use Within the IID Service Area Based on Population Projections from Census Data (Municipal Use) 57 Table 8: Future Water Demand Medium Future Water Demand, Scenario 2, Table 9a: Projected Imperial Valley Water Consumption, (Part 1) 58 Table 9b: Projected Imperial Valley Water Consumption, (Part 2) 59 Table 10: Compromise IID QSA Delivery Schedule 62 Table 11a: Projected Hudson Ranch 2 Irrigation Water Usage 64 Table 11b: Projected Simbol Calipatria 2 Irrigation Water Usage 65 Table 11c: Projected Hudson Ranch 2 and Simbol Calipatria Plant 2 Irrigation Water Usage 65 Table 12: IID Net Consumptive Use 69 Table 13: Annual Decree Accounting 71 Table 14: Past Agricultural Water Delivery 79 Table 15a: Projected Imperial Valley Water Consumption (AF), , Existing Conditions, Normal Water Year 81 Table 15b: Projected Imperial Valley Water Consumption (AF), , Proposed HR2 Conditions, Normal Water Year 81 Table 15c: Projected Imperial Valley Water Consumption (AF), , Proposed HR2 and SmCP2 Conditions, Normal Water Year 82 Pangaea Land Consultants, Inc. 3

8 Figures Figure 1: Context Map 9 Figure 2: Location Map 10 Figure 3: Hudson Ranch 2 Plot Plan with Well Sites and Simbol Calipatria Plant 2 Plot Plan 11 Figure 4: Typical Well Pad 12 Figure 5: Conceptual Plot Plan 16 Figure 6: Process Flow Diagram 18 Figure 7: Imperial Unit Service Area 50 Figure 8: Location Map (same as Figure 2) 51 Figure 9: Water Delivered to Agricultural Users v. Rainfall 55 Figure 10: Allocation of IID s Quantified Water Right 63 Figure 11: Proposed Transmission Line Connection 67 Figure 12: Aerial Photograph 80 Pangaea Land Consultants, Inc. 4

9 Executive Summary This combined Water Supply Assessment (WSA) is prepared for Imperial County Planning and Development Services Department (Lead Agency) by Pangaea Land Consultants, Inc. (Consultant) on behalf of two co-located projects addressed by a single Environmental Impact Report (EIR). The two projects are the Hudson Ranch 2 Geothermal Project (HR2) proposed by Hudson Ranch Power 2 LLC (Hudson Ranch), and the Simbol Calipatria Plant 2 (SmCP2) proposed by Simbol, Inc. (Simbol). The HR2 project and SmCP2 project are collectively referred to as the Projects. The WSA is prepared as a requirement of California law under Senate Bill 610 (Chapter 643, Statutes of 2001) amended state law, effective January 1, The co-location is due to SmCP2 s dependence on the existence of the HR2 plant. HR2 can exist and operate independently, but SmCP2 can only exist if the HR2 project is in operation. The Projects are planned to be operational for a period of 30 years, after which time the equipment and facilities will be properly abandoned. For this reason, the supply provisions time frame required by Senate Bill 610 has been extended from 20 years to 30 years to match the operational life of the Projects. With an initial operating date of late 2014 for HR2 and late 2016 for SmCP2, this analysis will consider the years 2015, 2020, 2025, 2030, 2035, 2040, and 2045 for the purposes of this WSA. Geothermal Project Description Hudson Ranch is proposing to construct and operate HR2, a 49.9 MW (net) geothermal power plant and wellfield project within the Salton Sea Known Geothermal Resource Area (KGRA) in Imperial County, California. The private parcels comprising HR2 are located about 2.5 miles southwest of the community of Niland. This facility will be identical in size and operation to the Hudson Ranch I Geothermal Project (HR1), currently beginning operations, and located approximately one mile west of HR2. The proposed HR2 plant consists of the following elements: 1. Geothermal well drilling and development of a geothermal wellfield 2. Construction and operation of a brine production facility (BPF) 3. Construction and operation of a turbine generator facility (TGF) 4. Electrical connection to the Imperial Irrigation District s (IID s) planned interconnection transmission line to HR2, which will transport power generated from the power plant to the existing IID electrical transmission grid system. HR2 will be operated by an affiliate of Hudson Ranch Power II LLC s parent company, EnergySource LLC (EnergySource). Processing Project Description Simbol is proposing to construct and operate SmCP2, a commercial lithium carbonate production plant that processes geothermal brine from HR2. The lithium carbonate product and other identified potential products will be sold commercially. SmCP2 will share the HR2 power plant site. The area of the Projects is zoned A-2-R-G, is located entirely within the existing Salton Sea Geothermal Overlay Zone, and consists of approximately 283 acres of private land either owned by EnergySource or leased by the geothermal mineral rights holders to EnergySource. Pangaea Land Consultants, Inc. 5

10 The site for the Projects currently consists of cultivated and fallow farmland. The combined footprint of the Projects will cover approximately 90 acres for the power plant and processing facilities, along with 15 acres for the well pads and 5 acres for roads for a total of 110 acres of the total site. Agricultural operations will continue on the balance of the property that has seen recent agricultural use. HR2 Water Consumption The projected water consumption for HR2 is approximately 3,940 acre-feet per year (AFY); consisting of 3,184 acre-feet for cooling water, 724 acre-feet for brine dilution water, 20 acrefeet for fresh water pond evaporation, and 12 acre-feet for miscellaneous uses. HR2 will produce approximately 2,740 AFY of very low salinity geothermal steam condensate, which will be used to supply approximately 83 percent of the cooling tower make-up water demand for HR2 (444 AFY of irrigation water is requested by Hudson Ranch for cooling water). The net water requested from IID is 1,200 AFY of non-potable industrial water (3,940 total 2,740 condensate). This water will be delivered via Gate 28 on the O Lateral. SmCP2 Water Consumption The projected water consumption for SmCP2 is approximately 800 AFY. This will be canal water purchased from the IID for projected cooling water makeup and for additional process water. Approximately 3 AFY of potable water will be delivered to the site for potable washbasin water, eyewash equipment water, water for showers and toilets in crew change quarters, and sink water in the sample laboratory. A filtration and/or reverse osmosis (RO) potable water system may be used to treat canal water for the potable water needs at the site. Process water will be used for reagent preparation, product washing, and as cooling tower make-up water. Process water will be generated from atmospheric steam condensate at the neighboring HR2 site. Additional process water for cooling tower make-up will be purchased from the IID and taken from the O Lateral canal. Water will be delivered to the shared freshwater pond via an above ground pipeline from the canal. The freshwater pond will be sized to meet the maximum combined water needs of both HR2 and SmCP2. Canal water will also serve as the source of water for maintenance purposes and to charge the cooling tower prior to startup. A relatively small amount of water will be needed during site construction for fugitive dust control during site grading and construction activities. This water will be purchased from the IID and transported to the site via temporary pipeline or water truck. Water Use Past agricultural use on the shared site has averaged 804 acre-feet per year; however, the site has not been in full agricultural production. If the site were in full agricultural production, the annual water use in an SDI year (5.25 acre-feet per acre) would be 1,501 acre-feet. The combination of HR2 (1,200 AFY) and SmCP2 (800 AFY) proposes to use a total of 2,000 AFY for industrial purposes. No extra industrial water is available in SDI years, except through the Interim Water Supply Policy (IWSP). It is because of IID s IWSP that the water supply is sufficient to allocate water from the IWSP to the Projects for industrial purposes and meet the projected demands through 2045 for the Service Area both with and without the proposed Projects. Pangaea Land Consultants, Inc. 6

11 Structure of Water Supply Assessment Because of the interrelationship of the two projects, the analysis elements of this Water Supply Assessment will evaluate the 1,200 AFY of HR2, as well as evaluate the cumulative 2,000 AFY of HR2 and SmCP2. Background of the Projects On July 20, 2007, Hudson Ranch submitted a letter to the Imperial Irrigation District (IID) regarding their intent to build two 49.9 MW power plants in the Salton Sea area; each of which would utilize about 800 AFY (at that time) of water from the IID. A subsequent letter on December 1, 2008 specifically requested a water supply agreement for 850 acre-feet per year of water for the initial HR1 project. A further letter to IID, dated April 2, 2009, confirmed the request for a water supply agreement for the initial HR1 project. Last, a letter to IID, dated January 8, 2010, revised the requested water amount for HR1 to 800 acre-feet per year. With the initiation of operations at HR1, along with a better understanding of the delivered geothermal resource, Hudson Ranch has determined they will need to increase their IID water requirement from 800 AFY to 1,000 AFY (an increase of 200 AFY). Based on this information and the proposed operations of the second power plant, the water requirement for HR2 is 1,200 AFY. To maximize the utilization of the geothermal resource, the SmCP2 facility was added to the plans for HR2. The Imperial County Planning and Development Services Department is preparing a Draft Environmental Impact Report for the combined HR2 and SmCP2 projects. Pursuant to their review and recommendations, mitigation measures will be proposed for HR2 and SmCP2. Description of the Projects Introduction and Location of Projects Hudson Ranch Power II LLC (Hudson Ranch) is proposing to construct and operate the Hudson Ranch II Geothermal Development Project (HR2), a 49.9 MW (net) geothermal power plant and wellfield project within the Salton Sea Known Geothermal Resource Area (KGRA) in Imperial County, California. HR2 will be operated by an affiliate of Hudson Ranch Power II LLC s parent company, EnergySource LLC (EnergySource). Simbol, Inc. (Simbol) is proposing to construct and operate a commercial lithium carbonate production plant, Simbol Calipatria Plant 2 (SmCP2) that processes geothermal brine from HR2. The lithium carbonate product and other identified potential products will be sold commercially. SmCP2 will share the site of HR2. The private parcels comprising the Projects lie about 2.5 miles southwest of the community of Niland and are located south and west of State Highway 111, west of English Road, and south of McDonald Road. The property, totaling 283 acres, is also described as: Western Parcel APN: Acres (one-half of this parcel covered by a geothermal lease) Eastern Parcel APN: Acres (option to purchase by EnergySource) HR2 occupies the north half of Section 19 of Township 11 South, Range 14 East, Niland Quadrangle (see Figures 1 and 2). HR2 lies one mile directly east of the Hudson Ranch I Geothermal Power Plant that was previously permitted by the County. Pangaea Land Consultants, Inc. 7

12 The proposed HR2 plant consists of the following elements: 1. Geothermal well drilling and development of a geothermal wellfield 2. Construction and operation of a brine production facility (BPF) 3. Construction and operation of a turbine generator facility (TGF) 4. Electrical connection to the Imperial Irrigation District s (IID s) planned interconnection transmission line to the Hudson Ranch I Geothermal Project, which will transport power generated from the power plant to the existing IID electrical transmission grid system. SmCP2 occupies the south half of the same parcel occupied by HR2. The proposed SmCP2 facility consists of the following elements: 1. Construction and operation of a facility to extract lithium, manganese, zinc and possibly other substances from geothermal brine and process the extracted substances to produce commercial quantities of lithium, hydrochloric acid, manganese, and zinc products and other possible products. 2. Construction and operation of brine supply/return pipelines and other associated interconnection facilities with the HR2 power plant. 3. Paving of McDonald Road from Highway 111 to English Road. 4. Construction of a power line with existing or proposed IID facilities. 5. Construction of a primary access road form McDonald Road. The General Plan designates the area of the Projects as Agriculture, and is zoned A-2-R-G (General Agriculture/Rural/Geothermal Overlay Zone). The Projects are considered to be consistent with the County s General Plan, the Geothermal/Alternative Energy and Transmission Element and the Land Use Ordinance with the approval of a Conditional Use Permit. The Projects are located entirely within the existing Salton Sea Geothermal Overlay Zone. The 1981 Salton Sea Anomaly Master EIR considered the environmental impacts of up to 1,400 MW s of geothermal energy including geothermal power plants with related production wells and islands, injection wells and islands, and related brine pipelines and the necessary electrical transmission facilities to export the energy produced to Southern California utilities. Currently, there are approximately 342 MW s of geothermal power being generated at the existing CalEnergy Salton Sea power plants. A Draft Environmental Impact Report is being prepared by the Imperial County Department of Planning and Development Services. It is anticipated that a Draft EIR will be prepared for the Projects under the California Environmental Quality Act by the County, similar to the Hudson Ranch I project, assessing the Project s consistency with the 1981 Master EIR and noting any mitigation measures. Pangaea Land Consultants, Inc. 8

13 FIGURE 1 Context Map Pangaea Land Consultants, Inc. 9

14 FIGURE 2 Location Map Current Land Use The eastern parcel of the Projects is cultivated farmland (240 acres, APN #009)). The west parcel (86 acres, APN #001) is comprised of two lots; the northern half (43 acres) is fallow farmland while the southern half (43 acres) is used for commercial algae production. The cultivated and fallow farmland constitute the total area of the Projects. The footprint of the Projects will comprise approximately 90 acres near the center of the eastern parcel (APN #009). Three well pads total 15 acres (two on APN #009 and one on APN #001) and roads account for 5 acres for a total footprint for the Projects of 110 acres. The commercial algae production facility will remain in operation. Agricultural operations will also continue within the balance of APN #009. HR2 Development and Operations Geothermal Development Well Program As part of its initial investigation, Hudson Ranch proposes to drill and test up to eight geothermal wells. Up to four of these will be drilled as geothermal production wells within two production well sites located in the west-central portion of HR2. The purpose of the development well program is to locate, sample, drill, complete, test and monitor potential geothermal resource Pangaea Land Consultants, Inc. 10

15 development target zones within the HR2 area. Additionally, up to three geothermal injection wells will be drilled within two injection well sites located on the eastern edge of HR2. A fourth injection well (plant well), for the injection of geothermal steam condensate, cooling tower blowdown and aerated geothermal brines will be drilled on the site. The proposed well locations are shown in Figure 3. FIGURE 3 Hudson Ranch 2 Plot Plan with Well Sites and Simbol Calipatria Plant 2 Plot Plan Each of the well sites will include a clay- or plastic-lined containment basin for the storage of waste drilling mud (see Figure 3). HR2 wellfield activities will also include the improvement or construction of required access roads. The proposed wells will be directionally drilled from the respective well sites to explore specific geophysical or geologic targets; each to a total depth of approximately 9,000 feet (into the geothermal zone) from one of the constructed well drilling pads. After drilling is completed, the wells will be flow-tested into portable storage tanks. Thereafter, the wells will continue to be monitored for well pressure and other data until placed into commercial service. Hudson Ranch proposes to commence drilling operations when all required permits are obtained. Site Access HR2 will have two access roads with the primary entrance from McDonald Road and a secondary access to the site from English Road. The access roads will be asphalt-paved or graveled and the power plant parking lot and internal roads will be asphalt-paved. New points of ingress/egress will be needed from McDonald and English Roads, with access from McDonald Road also requiring crossings over IID s O lateral canal. This work will be conducted as part of Pangaea Land Consultants, Inc. 11

16 targeted geothermal resource. FIGURE 4 Typical Well Pad the relocation of the O lateral to make room for the widening of McDonald Road for the Hudson Ranch I Development Project. Encroachment permits for ingress/egress and the lateral canal crossings will be obtained from the Imperial County Public Works Department and IID, respectively, as required. The access roads will be constructed or improved with gravel and/or maintained as needed to safely accommodate the traffic required for the well drilling activities. Roadbeds will typically be a minimum of ten feet across. The well sites were selected, in part, to minimize surface disturbance, reduce the potential for adverse environmental effects, and make the best use of the existing access within the limitations of testing the The principal access to the SmCP-2 plant site will be via the primary HR2 driveway access off of McDonald Road with secondary access via the HR2 secondary access road off of English Road immediately south of McDonald Road. Site Preparation Activities The HR2 production and injection well sites will each be constructed to be up to 500 feet by 400 feet in size (about 4.6 acres each). Pad preparation activities include clearing, earthwork, drainage and other improvements necessary for efficient and safe operation. Each site is designed to create a level pad for the drill rig and a graded surface for the support equipment. Runoff from undisturbed areas around the constructed sites will be directed into ditches and energy dissipaters (if needed) around the site, consistent with Imperial County, Imperial Irrigation District and California Regional Water Quality Control Board, Colorado River Basin Region (CRWQCB) best management practices for storm water. All machinery, drilling platforms, and oil and fuel storage will be in areas tributary to the cellar(s) in order to prevent the movement of storm water from these areas off of the constructed site. The well sites will be surrounded by a berm and graded to direct runoff from the respective pad into the cellar which will be pumped as necessary. An approximately 80-foot by 400-foot by 7-foot deep containment basin will be constructed on each of the well sites for the containment and temporary storage of waste drilling mud, drill cuttings and storm water runoff from the constructed site. The containment basins are designed to be lined with either a compacted clay liner or a 40-mil plastic liner with a 2-foot freeboard, in accordance with requirements of the CRWQCB. Pangaea Land Consultants, Inc. 12

17 Construction Water Requirements and Sources Water required for HR2 well drilling will typically average about 50,000 gallons per day. Water requirements for road grading, construction, and fugitive dust control for the Projects will average less. Water necessary for these activities will be obtained from local irrigation canals or laterals in conformance with IID construction water acquisition requirements. Water will be picked up from the source and delivered to each construction location or drilling site by a water truck which will be capable of carrying approximately 4,000 gallons per load. Alternatively, a water pump and temporary pipeline from the respective irrigation canal could be used to deliver water to a construction or drilling site. Any temporary water pipeline will be laid on the surface immediately adjacent to the access road to the site. Geothermal Well Drilling, Testing, and Monitoring The geothermal wells are designed to drill into and flow test the geothermal reservoir to confirm the characteristics of the geothermal reservoir and determine if the geothermal resource is commercially viable. Geothermal Well Drilling: Each geothermal well will be drilled with a large rotary drill rig. During drilling, the top of the drill rig derrick will be as much as 170 feet above the ground surface, and the rig floor could be 20 to 30 feet above the ground surface. The typical drill rig and associated support equipment (rig floor and stands; draw works; derrick; drill pipe; trailers; mud, fuel and water tanks; diesel generators; air compressors; etc.) will be brought to the prepared site on approximately 40 or more large tractor-trailer trucks. The placement of this equipment within each prepared site will depend on rig-specific requirements and site-specific conditions, but will be generally as shown on Figure 4. Additional equipment and supplies will be brought to the site during ongoing drilling and testing operations. As many as ten or more tractor-trailer truck trips may be generated during active drilling operations on the busiest day, although on average about two to three large tractor-trailer trucks (delivering drilling supplies and equipment), and about 12 to 16 small trucks/service vehicles/worker vehicles, will be driven to the site each day throughout the typical 60-day drilling process. Difficulties encountered during the drilling process, including the need to re-drill the hole, could double the time necessary to successfully complete a geothermal well. Drilling will be conducted 24-hours per day, 7-days per week. Approximately 9 to 18 workers will be on location at any given time. The drilling crews will not be living on location. Each geothermal well will be drilled to the design depth of 9,000 feet or the depth selected by the project geologist under a geothermal well drilling and completion program approved by the California Division of Oil, Gas and Geothermal Resources (CDOGGR). Blowout prevention equipment (BOPE), which is typically inspected and approved by CDOGGR, will be utilized while drilling below the surface casing. The geothermal wells will be cased and cemented to prevent interzonal migrations of fluids and reduce the possibility of blowouts. The well bore will be drilled using non-toxic, temperature stable gel-based drilling mud or gel and polymer drilling fluid to circulate the rock cuttings to the surface where they are removed from the drilling mud. The mud is then recirculated. Rock cuttings will be captured in the containment basin. Additives will be added to the drilling mud as needed to prevent corrosion, increase mud weight, and prevent mud loss. Additional drilling mud will be mixed and added to the mud system as needed to maintain the required quantities. Pangaea Land Consultants, Inc. 13

18 Each geothermal well may need to be redrilled if mechanical or other problems are encountered while drilling or setting casing which prevent proper completion of the well in the target geothermal reservoir. Depending on the circumstances encountered, redrilling may consist of reentering and redrilling the existing well bore; reentering the existing well bore and drilling a new well bore; or sliding the rig over a few feet on the same well pad and drilling a new well bore through a new conductor casing. Geothermal Well Testing: Each well will be tested by flowing the geothermal well into portable steel tanks brought onto the well site while monitoring geothermal fluid temperatures, pressures, flow rates, chemistry and other parameters. Steam from the geothermal fluid will be allowed to discharge to the atmosphere. Produced fluid from the short-term flow test will be pumped back into a non-flowing well. An injectivity test may also be conducted by injecting the produced geothermal fluid from the steel tanks back into the well and the geothermal reservoir. Following the short-term test, the well would be shut in. Temperature profiles of the wellbore will be measured during the shut in period. Geothermal Well Assessment and Monitoring: Following completion of the short-term geothermal well testing, all of the drilling and testing equipment will be removed from the site. A decision will be made by Hudson Ranch regarding the commercial potential of each well. If a well is judged by Hudson Ranch to have commercial potential, well operations will typically be suspended pending commercial service of the proposed geothermal power plant facilities. The surface facilities remaining on the site will typically consist of several valves on top of the surface casing, which will be chained and locked and surrounded by an approximately 12-foot by 12-foot by 6-foot high fence to prevent unauthorized access and vandalism. Pressure and temperature sensors may be installed in the hole at fixed depths to monitor any changes in these parameters over time. A temperature profile of the well may also be run. The wells will likely continue to be monitored while these approvals are being processed. This monitoring may be continued indefinitely. Well Abandonment After drilling operations are completed on each well, the liquids from the containment basin will either be evaporated, pumped back down the well, or disposed of in accordance with the requirements of the CRWQCB. The solid contents remaining in each containment basin, typically consisting of nonhazardous, non-toxic drilling mud and rock cuttings, will be tested as required by the CRWQCB. The solids will be removed and disposed of in a waste disposal facility authorized by the CRWQCB to receive and dispose of these materials. After the materials in the containment basins have been removed to an authorized disposal site, the containment basin area will be reclaimed. If a well is judged to not have commercial potential, it may continue to be monitored, or it may be abandoned in conformance with the well abandonment requirements of the CDOGGR. Abandonment of a geothermal well involves plugging the well bore with clean drilling mud and cement sufficient to ensure that fluids will not move across into different aquifers. The wellhead (and any other equipment) will be removed, the casing cut off at least six feet below ground surface, and the well site reclaimed. Pangaea Land Consultants, Inc. 14

19 Development Facilities Site Access Access to the development facilities will be served by two new access roads (see Figure 5). Primary site access will be from McDonald Road, which will require a crossing of the IID O lateral canal. Secondary access to the plant site will be from English Road, south of the IID O lateral canal. The access roads will be asphalt-paved or improved gravel. Encroachment permits for ingress/egress and lateral canal crossings will be obtained from the Imperial County Public Works Department and Imperial Irrigation District, respectively, as required. Power Plant Site All the HR2 development facilities, with the exception of the production and injection wells and pipelines, will be located within an approximately 40-acre power plant site located near the center of the Project area (APN ) bounded on the north by McDonald Road, on the east by English Road, on the south by Schrimpf Road, and on the west by fallow irrigated farmland (see Figures 3 and 5). The control room parking lot and all internal plant roads will be asphalt paved. An approximately 20-acre area located immediately south of the power plant site will be used during site construction as a temporary construction equipment laydown area and construction parking area (see Figure 3). Both the Brine Processing Facility (BPF) and the Turbine-Generator Facility (TGF) will be located within the power plant site. Brine Processing Facility The BPF includes the brine- and steam-handling facilities, solids-handling system, a brine pond and a fresh water pond (see Figure 5). Geothermal fluid produced from the production wells will be delivered to the power plant site through above ground pipelines to the brine- and steam-handling facilities. The geothermal fluid will be flashed in the steam-handling facilities (flash tanks, vent tanks and associated facilities) at successively lower pressures to produce high-pressure (HP), standard-pressure (SP), and low-pressure (LP) steam that will be delivered to the TGF. The chemically stabilized separated brine will flow from the BPF into the solids-handling system (clarifiers, thickener and associated facilities) where solids are removed. Two booster and two main injection pumps will be used to pump the spent brine from the secondary clarifier of the BPF to the injection wells via the aboveground brine injection pipelines for subsurface injection. A process flow diagram is provided to illustrate fluid movement through the BPF (see Figure 6). Brine Pond: A cement-lined brine pond will be constructed within the BPF. The brine pond will serve multiple purposes. The brine pond will be sized to accommodate up to three hours of brine that could be released during system upset conditions plus two feet of freeboard. During such upset conditions, brine that overflows from the clarifiers and the thickener, and condensate from the steam vent tanks, would be directed to this pond for temporary containment, after which this liquid will be processed through the thickener and delivered to the main injection pumps or pumped to the cooling tower blowdown/condensate/aerated brine injection well for subsurface injection. Reject water from the reverse osmosis system will also be directed to the brine pond. The brine pond may also collect brine from the production wells when they are flow-tested after drilling and from the production wells when brine is initially introduced into the facility during startup. Pangaea Land Consultants, Inc. 15

20 FIGURE 5 Conceptual Plot Plan Pangaea Land Consultants, Inc. 16

21 This liquid would be pumped to a thickener and then discharged into an injection well or back into the BPF after startup is complete. The brine pond will be constructed as a waste management unit (WMU) to meet CRWQCB surface discharge requirements. Groundwater monitoring wells will be constructed adjacent to the brine pond in conformance with CRWQCB requirements. Development Wells: Four geothermal production wells and three geothermal brine injection wells are expected to be required to support the Projects. If the four geothermal wells to be directionally drilled on the two production well sites are commercially successful, then they will become the geothermal production wells for the Projects. Similarly, if the three geothermal wells proposed to be directionally drilled on the two brine injection well sites have suitable injection well characteristics, then they will become the residual brine injection wells for the Projects. One additional aerated brine injection well (plant well) will be drilled on the power plant site for the injection of cooling tower blowdown, condensate, and aerated brines (see Figures 3 and 5). All production and injection wells will be operated in accordance with California Division of Oil, Gas and Geothermal Resources (CDOGGR) regulations. Well Site Production and Injection Equipment: Production wellhead dimensions are not expected to exceed a height of fifteen feet above the ground surface or four feet in diameter. The wellhead will consist of control valves and isolation valves. The wellheads will be painted an appropriate color to blend with the area and minimize visibility. Injection pumps located at the power plant site will pump the geothermal injection fluid through the injection pipeline system, providing sufficient pressure to inject the polished geothermal brine back into the geothermal reservoir. Limited electrical equipment is required at the injection well sites. A flow meter will be integrated into the injection pipeline equipment on the well pad and remotely operated from the power plant control room. Overhead lighting will be constructed on the injection well pads. Geothermal Pipeline Systems: Above-ground pipelines will be constructed to interconnect the production and injection wells with the power plant site facilities (see Figure 3). A graded road would be built for pipeline construction and maintenance to allow the necessary access. The production wellheads will all be located on production well sites, located west of the power plant site. An above-ground pipeline will be constructed from the production wells to the brine and steam-handling facilities on the power plant site. The production pipelines would be constructed from alloy or alloy-lined pipe designed, constructed, tested and inspected pursuant to current industry standards for high temperature, high-pressure piping. They would be nearly identical to the pipelines currently used to move geothermal production fluids to the existing Salton Sea KGRA geothermal power plants. The diameter of the pipe would depend on the amount of geothermal fluid to be conveyed. Once covered with about two inches of insulation and a protective metal sheath (appropriately colored to blend with the area), the overall outside diameter of the finished pipe would range up to 36 inches. The pipeline would be constructed at ground level (averaging about one foot off the ground) on pipeline supports installed approximately every 20 to 40 feet along the pipeline routes. No road crossings are anticipated for the production pipeline. Pangaea Land Consultants, Inc. 17

22 FIGURE 6 Process Flow Diagram Pangaea Land Consultants, Inc. 18

23 The brine injection pipeline will be a cement-lined carbon steel pipeline. Each injection well would be remotely monitored for pressure, temperature, and flow rate. The brine injection pipeline will also be nearly identical to the pipelines currently used to transport polished brine from the existing Salton Sea KGRA geothermal power plants to their respective injection wells. The diameter of the injection pipeline will depend on the amount of geothermal brine to be conveyed. The brine injection pipeline will also be covered with about two inches of insulation and a protective metal sheath and constructed near ground level on pipeline supports installed along the pipeline routes. No road crossings are anticipated for the brine injection pipeline. All County road ingress/egress will be constructed in conformance with Imperial County Public Works Department requirements. Road access will be restricted during construction, and appropriate traffic controls would be in place during any construction within the roadbed or adjacent shoulders of the road to warn and control traffic. No pipeline crossings of the IID canals or drains will be required. If applicable, field drains and head ditches will be crossed by the pipelines as agreed to with the individual landowner/geothermal lessor. Pipeline construction will be conducted concurrently with construction of the power plant. Turbine Generator Facility The TGF includes a 49.9 MW (net) condensing turbine/generator set, a gas removal and emission abatement system, and a heat rejection system (i.e., condenser and cooling tower). Common facilities within the TGF area include a control building, warehouse, a service water pond, and other ancillary facilities. The TGF also includes a 230 kv switchyard and several power distribution centers. The turbine generator system will consist of a condensing turbine generator set with three steam entry pressures (HP, SP and LP). The turbine will be directly coupled to a totally enclosed water and air-cooled (TEWAC) synchronous-type generator. The turbine-generator unit will be fully equipped with all the necessary auxiliary systems for turbine control and speed protection, lubricating oil, gland sealing, generator excitation, and cooling. A process flow diagram is provided to illustrate fluid movement through the TGF (see Figure 6). Two 100% redundant diesel generators will also be installed to provide black start capability and emergency site power when the steam turbine generator is shut down. A 400 kw emergency generator will also be installed to provide backup for plant control power. The diesel engines will meet California Air Resources Board (CARB) air pollutant emission limits. The generators are expected to operate less than 600 hours per year. Heat Rejection and Noncondensible Gas Removal Systems The heat rejection system will be comprised of a shell-and-tube type condenser, a counterflow cooling tower, and a noncondensible gas (NCG) removal system. Steam from the turbine will be condensed in the condenser. Condensate from the condenser will be transferred to the cooling tower, cooled and returned to the condenser. Gases that accumulate in the condenser will be evacuated by the NCG removal system. NCG will be pressurized and vented to a hydrogen sulfide (H2S) abatement system. The H2S abatement system used to control the H2S emissions in the vent gases will be a Biox process. The Biox system consists of using an oxidizing biocide in contact with the cooling tower circulating water to convert dissolved hydrogen sulfide to water-soluble sulfates. Biocide assisted oxidation prevents secondary emissions of hydrogen sulfide from cooling towers that Pangaea Land Consultants, Inc. 19

24 utilize steam condensate for makeup water. The process will also be utilized to control primary hydrogen sulfide vent gas emissions by bubbling the off-gas into the tower catch basin. The Biox system is expected to remove at least 95 percent of the H2S in the NCG and at least 98 percent of the H2S in the portion of the condensate used as cooling tower makeup water. When all of the condensate is used (during the high temperature summer months), H2S emissions from both sources are expected to total less than 3.5 pounds per hour. Benzene emissions are expected to be less than 0.5 pounds per hour. A potential source of particulate emissions from the Projects is the cooling tower. During normal operating conditions, the plant is projected to generate less than 1 lb/hr of particulates. Particulate emissions from the cooling towers will be minimized by maintaining a low total dissolved solids (TDS) concentration in the circulating water and by controlling cooling tower drift losses to not more than percent of the total circulation rate using high efficiency drift eliminators. Blowdown from the cooling tower will ultimately be injected into the dedicated cooling tower blowdown/condensate/aerated brine injection well. During plant start-up, a plant trip or load rejection, steam to the turbine will be diverted to a rock muffler for venting as is currently being done at the existing geothermal power plants in the Salton Sea KGRA. During this time, H2S and other NCG will be released to the atmosphere. A combination of best available control technology, management practices, and process monitoring equipment will be used to minimize the air emissions from the power plant facilities. Permits to construct and operate the facility will be obtained from the Imperial County Air Pollution Control District (ICAPCD). Electrical Power Transmission Electrical power will be produced at the facility by the turbine generator. The output of the generator is connected through a generator breaker to a (16 kv to 230 kv) main step-up transformer in the facility switchyard. Surge arrestors will be used protect the 230 kv transformer from lightning strikes or other disturbances. The transformer will be set on a concrete pad within an oil containment system. The high voltage side of the main step-up transformer will be connected to the interconnection transmission line adjacent to the Hudson Ranch 2 power plant site. The interconnection transmission line will be constructed, owned and operated by the IID as part of the Hudson Ranch 1 Development Project. Two connection line routes to the interconnection transmission line internal to the power plant site are under consideration (see Figure 3). Internal plant electrical power will be provided from the plant steam generator during normal operation and by IID or two emergency diesel generators when the plant is shut down. Site Grading and Drainage The entire area of the Projects is fairly level (see contours on Figure 3). The proposed drainage design in general will flow toward a storm water detention pond located on the power plant site. Within the power plant site, buildings and equipment will be constructed on foundations with the overall site grading scheme designed to route surface water around and away from all equipment and buildings. The storm water drainage system is sized to accommodate 3 inches of precipitation in a 24-hour period (100-year storm event) and to comply with applicable local Pangaea Land Consultants, Inc. 20

25 codes and standards. Buildings and equipment are constructed in a manner that provides protection from such a 100-year storm. Storm water flows will be directed to the detention pond via ditches, swales, and culverts. Spill containment areas and sumps subject to spills of miscible chemicals would be drained to an enclosed oil/water separator and be collected in a waste oil tank for offsite recycling. The power plant site would be graded and constructed so that all spills would drain into the brine pond. Clean water from the oil/water separator would be injected into the cooling tower blowdown condensate-aerated brine injection well. Brine-handling equipment will be contained in curbed concrete aprons, with drainage directed to the plant thickeners and subsequently to the aerated brine injection well or the main brine injection system. Fire Protection and Safety Systems The HR2 fire protection system will consist of an underground fire main and surface distribution equipment such as yard hydrants and hose houses, monitors around the perimeter of the cooling tower, automatic sprinklers for the turbine generator and auxiliary equipment, and a complete detection and alarm system. The firewater supply and pumping system will provide an adequate quantity of fire-fighting water. The systems will be designed in accordance with federal, state, and local fire codes, occupational health and safety regulations; and other jurisdictional codes, requirements and standard practices. Water Supply Source and Requirements The HR2 facility will require up to 1,124 acre-feet per year (AFY) of water from IID for brine dilution (about 94 percent), supplemental cooling tower makeup (44AFY, or about 4 percent) and other plant uses (32 AFY, or about 2 percent) when operating at full plant load. Average annual demand requirements will vary, depending on the capacity factor of the overall facility. The primary source for of the cooling water for the plant will be geothermal steam condensate derived from the plant itself. The source of the external freshwater for HR2 from IID is anticipated to be irrigation water made available under a supply contract with the IID. Water will be obtained from the O lateral at the proposed gate 28, located north of the power plant site. Water will be transferred to an HDPElined water storage pond on the power plant site via a freshwater pipeline (see Figure 3). The water will be used for dilution of geothermal brine, solids dewatering system, steam wash water, purged water for pump seals and the reverse osmosis (RO) potable water system and, at times, cooling water makeup. As noted above, HR2 is designed to minimize reliance on external sources of water supply for process needs by using condensed steam from the geothermal steam condensate to the greatest extent practical. Canal water will also serve as the source of water for maintenance purposes and firewater for the fire protection system. It will be used to charge the cooling tower prior to startup. The RO potable water system will be used to treat canal water and provide a supply of drinking water, washbasin water, eyewash equipment water, water for showers and toilets in crew change quarters, and sink water in the sample laboratory. Spent Fluid and Wastewater Handling Spent brine from the secondary clarifiers will be injected directly into the injection wells to replenish the geothermal resource. Under overflow conditions, brine would be directed to the Pangaea Land Consultants, Inc. 21

26 brine pond, after which it would be processed through the thickener and delivered to the main injection system or injected into the dedicated aerated brine injection well. This dedicated injection well could also receive liquid from the thickener, which collects filter press filtrate, and liquid from the bermed areas around the plant equipment. The brine pond also receives liquid from the emergency relief tanks. Under normal operation these fluids will be processed through the thickener and pumped into the main injection system. The reject water from the RO system will be pumped into the aerated brine injection well. Spent geothermal brine will be injected into the subsurface geothermal reservoir via the primary injection wells. The spent fluids from the brine pond will also be injected into the subsurface geothermal reservoir via either the dedicated aerated brine injection well, or processed through the thickener and then delivered to the main injection system. All subsurface fluid injection will conform to California Division of Oil, Gas and Geothermal Resources requirements. To keep the dissolved solids concentration of the circulating water in the cooling towers at acceptable levels, a stream of circulating water blowdown will be injected from the cooling towers into the dedicated aerated brine injection well. Sanitary drains will discharge to an appropriate and approved collection system. Rain and storm drainage will be collected in the drainage water detention pond on the south side of the facility location. The drainage pond will be designed for a 24-hour, 100-year storm event. Water accumulated in the storm water detention pond will be allowed to evaporate, seep into the ground, or be pumped into the aerated brine injection well. Work Force and Schedule Well drilling is scheduled to begin in 2012, or as soon as all needed permits are obtained. The overall schedule for HR2 from Notice to Proceed to total Construction Site Cleanup and Demobilization is expected to take about 28 months. Construction and startup of the power plant from the start of site mobilization to commercial operation is expected to take at about 27 months. Well drilling operations will be conducted 24 hours a day, seven days a week until the total well depth is reached. An estimated eight weeks will be required to drill each well, and approximately 12 people will be working at each site at any one time. Site preparation, including drill rig assembly, will require approximately one to two weeks per well. The construction schedule is based on a single-shift, 10 hours/day-6 days/week workweek, and facility startup schedule is based on a two-shift, 24 hours/day-7 days/week workweek. Overtime and shift work for construction may be used to maintain or enhance the construction schedule. A peak construction work force of up to 175 craft and professional construction workers is anticipated to be on site following start of construction. Most construction workers will park off site in an area adjacent and east of the power plant site. This parking area is approximately 4 acres and may be fenced during the construction period. The area will be maintained for stability and safety. Electrical interconnection will coincide with plant construction. Facility operations will begin as soon as construction activities are completed. Beginning with startup operations, the Project is expected to be operated by a staff of approximately 14 full- Pangaea Land Consultants, Inc. 22

27 time, onsite employees. The operations work force assumes a two-shift, 24-hour/day, 7- days/week workweek. Abandonment The projected life of the HR2 facility is a nominal 30 years. At the end of the useful life of HR2, equipment and facilities will be properly abandoned. The geothermal wells will be abandoned in conformance with the well abandonment requirements of the CDOGGR. Abandonment of a geothermal well involves plugging the well bore with clean drilling mud and cement sufficient to ensure that fluids would not move across into different aquifers. The wellhead (and any other equipment) will be removed, the casing cut off at least six feet below ground surface, and the well site reclaimed. At the end of power plant operations, Hudson Ranch will prepare and implement a Site Abandonment Plan in conformance with Imperial County and CDOGGR requirements. The Plan will describe the proposed equipment dismantling and site restoration program in conformance with the wishes of the respective landowners/lessors and requirements in effect at the time of abandonment. Typically, above-ground equipment will be dismantled and removed from the site. Some below ground facilities may be abandoned in place. The surface of the site would then be restored to conform to approximate pre-project land uses. Environmental Protection Measures Well Drilling and Site Construction Environmental Protection Measures All Hudson Ranch, construction and drilling contractor personnel will be informed of Hudson Ranch s policy regarding undue degradation of the environment. These measures are intended to prevent all unacceptable impacts from occurring as a result of the proposed short-term and temporary drilling and construction operations. Fire Prevention: Well sites, construction sites, and access roads will be cleared of all vegetation. The cleared areas will be maintained during drilling and construction operations. Fire extinguishers will be available around the drilling rig and on construction sites. Water that is used for drilling will also be available for fire fighting. Personnel will be allowed to smoke only in designated areas. Surface and Ground Water Quality Protection: Hudson Ranch will submit a Report of Waste Discharge to the California Regional Water Quality Control Board, Colorado River Basin Region (CRWQCB), and will comply with the CRWQCB permit conditions to protect water resources. Hudson Ranch will also submit encroachment permit applications to the IID for roads and activities that may occur in IID rights-of-way, and will comply with the IID permit conditions to protect irrigation channels and water delivery facilities in the area. Required permits would be obtained from the IID for any construction or drilling water to be produced from IID canals. The well site locations have been selected to minimize the potential for surface water pollution from runoff during construction, drilling, and testing. Cemented concentric steel and alloy casing will prevent surface water and ground water pollution from produced fluids. Pangaea Land Consultants, Inc. 23

28 Only non-toxic, nonhazardous drilling mud will be utilized during drilling operations. Waste drilling mud and drill cuttings will be stored in the lined containment basin. Any runoff from the site will be discharged into the containment basin. The geothermal wells will be cased and cemented to prevent interzonal migrations of fluids and reduce the possibility of blowouts. Based on production and injection wells previously drilled in the Salton Sea KGRA, no over-pressured or gas-rich zones are expected to be encountered. Prevention of Soil Erosion: Where fill is needed in the construction of well pads, construction sites, or access roads, it will be provided. Runoff will be channeled to energy dissipaters as necessary to minimize erosion. In addition, the Project will adopt relevant CRWQCB best management practices if necessary to further prevent soil erosion. Air Quality Protection: Applications will be submitted to the Imperial County Air Pollution Control District (ICAPCD) for an Authority to Construct permit for the geothermal wells and site construction activities. Hudson Ranch will comply with the ICAPCD permit conditions of approval to limit emissions from HR2 activities. Fugitive dust generation during construction and use of on-site plant roads and the well sites will be minimized by watering as necessary. To further reduce fugitive dust emissions, vehicle traffic on plant roads and well sites will be kept below 15 miles per hour. Hudson Ranch will comply with any requirements concerning emissions of air pollutants from well-drilling equipment and noncondensible gases from the geothermal fluid during flow testing. Prevention of Noise: To abate noise pollution, mufflers will be utilized on engine-driven equipment during both construction and development operations. Protection of Public Health and Safety: In addition to the emergency contingency plans, public health and safety will be protected through instructions to work crews and contractors regarding compliance with regulations. Protection of Fish, Wildlife, and Botanical Resources: Direct impacts to wildlife habitat and botanical resources will be minimized by clearing only the small area required for well pads, development facilities, and access roads. Fish habitat will be protected through prevention of erosion. Protection of Cultural Resources: The entire Hudson Ranch area has been completely disturbed by agricultural operations in the past and no cultural resources are known to occur in the area. Waste Disposal: A containment basin is located on the drilling pad and all used mud and cuttings will be contained in this basin until drilling operations are complete. After drilling operations are complete, the mud and associated drilling liquids will be allowed to evaporate. The solids will be tested for ph, oil and grease, and metals. The solids will be removed and disposed of in a waste disposal facility authorized by the CRWQCB to receive and dispose of these materials. Solid waste materials (trash) and construction waste will be deposited at an authorized landfill by a disposal contractor. Pangaea Land Consultants, Inc. 24

29 Portable chemical sanitary facilities will be used by all personnel during the construction phase. These facilities will be maintained by a local contractor. During operations, permanent facilities will be used. They, too, will be serviced by a local contractor. Environmental Monitoring: Pending development activities, regular, routine visual inspections of the drill sites and access roads will be conducted by Hudson Ranch personnel to quickly detect and correct any problems that could lead to adverse environmental effects. The drilling fluid and cuttings will be monitored by visual inspection and chemical analyses by the drilling personnel, the well site geologist, and the contract mud engineer to detect any problems which may be occurring downhole. An Environmental Specialist will monitor and inspect the operations, as necessary, during the course of the project. SmCP2 Development and Operations The SmCP2 plant site will be located immediately south of the HR2 power plant site. Primary access to the SmCP2 plant site will be from McDonald Road (see Figure 3). Development Facilities Site Access Truck access to the SmCP2 plant site will be constructed off of McDonald Road. The proposed HR2 driveway access off of English Road immediately south of McDonald will be used by Simbol employees (see Figure 3). SmCP2 Operations The SmCP2 plant will utilize post secondary clarifier brine produced from the geothermal fluid management activities on the neighboring HR2 power plant site as the resource process stream. The SmCP2 facility will utilize proprietary technology developed by Simbol to extract lithium, manganese, zinc and possibly other constituents of the geothermal brine; and convert these substances into lithium carbonate, lithium hydroxide, hydrochloric acid, and zinc and manganese products. The post extraction geothermal brine will then be returned to the HR2 site for subsurface injection and geothermal reservoir pressure maintenance. A silica management area and lithium, zinc and manganese extraction process areas will be constructed within designated portions of the plant site on concrete pad(s) with a containment curb. These process areas will not be located within a building but will consist of a series of interconnected tanks and pipelines. The arrangement of these facilities is part of the proprietary Simbol technology. Product processing facilities consisting of a series of interconnected tanks and pipelines will also be constructed on the site. The processing facilities will also be erected within designated portions of the plant site on concrete pad(s) with a concrete containment curb or in designated buildings. The arrangement of these facilities is also part of the proprietary Simbol technology. The commercial products produced on the SmCP2 plant site will be transported offsite by truck to market distribution centers. SmCP2 Facilities Pipe Rack and Process Pipelines A pipe rack will be constructed from the HR2 BPF to the SmCP2 Silica Management/Lithium Extraction process area. A post clarifier brine delivery pipeline from the HR2 Brine Processing Facility (BPF) to the SmCP2 process area and a post extraction brine return pipeline from the Pangaea Land Consultants, Inc. 25

30 process area to HR2 BPF will be constructed onto the pipe rack. Additional delivery or return pipelines may also be constructed onto the pipe rack as needed. Silica Management Facilities A silica management area will be constructed within a designated area of the plant site on concrete pad(s) with a concrete containment curb. This process area will not be located within a building but will consist of a series of interconnected tanks and pipelines. The arrangement of these facilities is part of the proprietary Simbol technology. Silica Filter Cake Handling Facilities A series of filter presses will be constructed to remove excess fluid and compress silica separated from the geothermal brine into a filter cake. The silica filter cake will initially be managed as a waste stream, but the silica filter cake may be converted into a new product stream at a later date. Product Extraction and Production Facilities Product extraction and production facilities consisting of a series of interconnected tanks and pipelines will also be constructed on the site. These facilities will also be erected within a designated portion of the plant site on concrete pad(s) with concrete containment curbs or in designated buildings. The arrangement of these facilities is also part of the proprietary Simbol technology. Freshwater and Stormwater Retention Ponds The SmCP2 project will share the HDPE lined freshwater pond and the stormwater retention pond with the HR2 power plant. The ponds will be sized to meet the combined storage requirements of the two Projects. Plant Product Operations The SmCP2 plant will utilize post-secondary clarifier brine produced from the geothermal fluid management activities at the neighboring HR2 BPF as the resource process stream for the commercial production of lithium carbonate product and other products. The production operations would consist of the following general processing steps. The production processing steps may be altered over time as production methods and efficiencies evolve and new or revised product lines are developed at the facility. The arrangement of equipment within the respective process areas is part of the proprietary technology developed for the plant site (see Figure 5). Silica Management Lithium Extraction as Lithium Chloride (LiCl) Conversion and Processing of LiCl to Lithium Products Drying and Packaging of Lithium Products HCl Product Synthesis Zinc Extraction and Processing to Zinc Products Manganese Extraction and Processing to Manganese Products Offsite Product Shipping Silica Management Post heat extraction geothermal brine from the secondary clarifier of the HR2 BPF will be transported via pipeline to the Sm Silica Management process area. Pangaea Land Consultants, Inc. 26

31 A nominal 5,200 gallons per minute (gpm) of the brine will be processed by the facility. This projected process rate was used as the basis for the water use estimates provided throughout this project description, but the actual rate of brine eventually processed on the site will be optimized to take advantage of the available facilities on the HR2 and SmCP2 plant sites. Iron and silica will be removed from the brine using proprietary technology. The iron-silica material will be initially managed as a waste stream. However, in the future Simbol plans to market the iron-silica material as an additional product to be shipped offsite for use in other industrial processes as a product stream. Lithium Extraction as LiCl The iron- and silica-free brine will be fed to a lithium extraction process located within the Lithium Extraction process area on the SmCP2 plant site. This area will be outside on a concrete pad. The area will contain proprietary lithium extraction media. Lithium from the brine will be retained on the extraction media. A lithium chloride (LiCl) product stream will be produced from the extraction process and then purified and concentrated. Conversion of LiCl to Lithium Products The purified, concentrated LiCl will be transported via pipeline from the Lithium Extraction process area to the Lithium Product Production Buildings. Proprietary technology will be used to convert the LiCl into Li 2 CO 3 and LiOH H 2 O products. Drying and Packaging of Lithium Products The dried lithium products will be packaged, palletized, staged, and loaded into trucks for distribution in the Lithium Handling Building. The dried lithium products will be loaded into bulk bags in a bagging station. Packaging is expected to be into 20 kilogram (kg) bags or into 1,000 kg super sacks. HCl Product Synthesis Commercially available technology will be used to synthesize HCl gas during the conversion of LiCl to lithium products. The HCl gas will be dissolved in water to produce a 31% HCl product. The 31% HCl product will be transported to a storage tank where the HCl will be stored pending transport to offsite markets or re-use within SmCP2. Zinc (Zn) Extraction and Processing to Zn Products The lithium-depleted brine from the LiCl process will be fed to a unit in the Zinc Extraction area that extracts zinc as ZnCl 2. The ZnCl 2 rich fluid will be transported to the Zinc Product Production Area where it will be concentrated into a solution of ZnCl 2 or converted to a ZnSO 4 product for offsite shipment. Manganese (Mn) Extraction and Processing to Mn Products The zinc-depleted brine from the ZnCl 2 extraction process will be transported to the Manganese Extraction Area. Manganese will be precipitated from the brine into manganese oxides/hydroxides by adding reagents, then dewatered in a filter press and then packaged as a wet cake product in the Manganese Product Production Area. The manganese wet cake product will then be shipped offsite to market. Offsite Product Shipping The SmCP2 plant will produce multiple products for offsite shipment to market by truck. The average annual amount of product shipped out of the plant at operating at 5,200 gpm brine flow capacity is estimated at 10,000 to 16,000 metric tons of dry lithium product (Li 2 CO 3 and/or Pangaea Land Consultants, Inc. 27

32 LiOH H2O), 20,000 to 40,000 metric tons of zinc product(s), up to 50,000 metric tons of wet cake manganese product(s), and approximately 60,000 metric tons of 31% liquid HCl product. Products will be transported by freight truck on existing roadways to shipping distribution point(s) in the San Diego or greater Los Angeles areas. Other products of the production operations may be generated by the proprietary technology on the plant site, and would also be shipped offsite to market by truck. Electrical Power Up to 27 MW of electrical power needed for the SmCP2 operations will be purchased from the IID. A new power distribution line will be constructed to the SmCP2 plant site from a proposed IID substation in the northeast quarter of Section 24, Township 11 South, Range 13 East, SBB&M (about one mile southwest of the SmCP-2 plant site). The new power line will follow either a northern or southern route option to the plant site (see Figure 2). Alternatively, electrical power will be obtained from a new power line within the existing IID grid system. An emergency diesel generator will be used to keep vital SmCP2 plant systems operating during power outages. Firewater Storage Tank and Fire Protection System The shared freshwater pond will also provide firewater storage for the project. The fire protection system will be equipped with quick connect hose bibs; an underground fire main and surface distribution equipment such as yard hydrants and hose houses; monitors around the perimeter of the cooling tower; automatic sprinklers for the buildings, if needed; and a complete detection and alarm system. The firewater supply and pumping system will provide an adequate quantity of fire-fighting water. A diesel-fueled firewater pump will be available on site. The systems will be designed in accordance with federal, state, and local fire codes; occupational health and safety regulations; and other jurisdictional codes, requirements, and standard practices. Water Supply Source and Requirements A relatively small amount of water will be needed during site construction for fugitive dust control during site grading and construction activities. This water will be purchased from the IID and transported to the site via temporary pipeline or water truck. Process water will be used for reagent preparation, product washing, and as cooling tower make-up water. Process water will be generated from atmospheric steam condensate at the neighboring HR2 power plant site. Additional process water for cooling tower make-up will be purchased from the IID and taken from the O lateral canal. Water will be delivered to the shared freshwater pond via an above ground pipeline from the canal. The freshwater pond will be sized to meet the maximum combined water needs of both the HR2 power plant and the SmCP2 plant. Canal water will also serve as the source of water for maintenance purposes and to charge the cooling tower prior to startup. Approximately 800 AFY of canal water will be purchased from the IID for projected cooling tower makeup, for process water, pond evaporation, and miscellaneous uses. Approximately 3 AFY of potable water will be delivered to the site for potable washbasin water, eyewash equipment water, water for showers and toilets in crew change quarters, and sink water in the sample laboratory. Alternatively, a filtration or reverse osmosis (RO) potable water system may be used to treat canal water for the potable water needs at the site. Work Force and Schedule (Construction) Pangaea Land Consultants, Inc. 28

33 SmCP2 construction will begin when all necessary permits have been acquired. Site construction is expected to take approximately 18 months to complete. Construction will be on a 5-days per week, up to 12-hour daylight work day schedule. An average construction work force of 175 workers peaking to about 200 workers is projected. Construction is tentatively projected to be completed in Construction workers will commute to the site and there will be no on site housing of construction workers. Construction parking will be in the laydown area. Construction Traffic It is estimated that on average 25 delivery trucks per day will travel to and from the SmCP2 construction site except during site grading when about 60 trucks will travel to and from the SmCP2 construction site. An average of 175 workers will commute to the site during site construction. Work Force and Schedule (Operations) SmCP2 operations will begin as soon as construction activities are completed. Beginning with startup operations, SmCP2 is expected to be operated by a total staff of approximately 90 full-time, onsite employees. Plant operations will continue 24-hours/day, 7-days/week. It is projected that up to 44 employees will be on site at any given time with 28 day-staff employees and four rotating shifts of 16 additional employees overlapping the day-staff and covering nights, weekends and holidays. Plant Operations Traffic It is estimated that approximately 44 large trucks and 10 small trucks will travel in and out of the SmCP2 plant site per day during normal operations. This includes truck deliveries of reagent chemicals; cooling tower treatment chemicals; consumptive media; product packaging materials; and fuel. It also includes the outgoing shipping of products and wastes. Additional traffic will result from the plant staff commuting to the site and periodic contractor and maintenance vehicles. Mobile equipment operating on the plant site will include up to 12 forklifts and four pickup-sized vehicles. Abandonment and Site Restoration The projected life of the SmCP2 plant is a nominal 30 years. At the end of the useful life of the plant, equipment and facilities will be properly abandoned. At the end of SmCP2 plant operations, Simbol will implement a Site Abandonment Plan in conformance with Imperial County requirements. The Plan will be prepared prior to Project approval by the Planning Commission. The Plan will describe the proposed equipment dismantling and site restoration program in conformance with the wishes of the respective landowners/lessors and requirements in effect at the time of abandonment. Typically, above-ground equipment will be dismantled and removed from the site. Some below ground facilities may be abandoned in place. The surface of the site would then be restored to approximate pre-project land status. Environmental Protection Measures Environmental protection measures will be adopted as part of SmCP2 to minimize air emissions, protect surface and groundwater quality, and prevent spills. The construction and operation of the facility would generate both nonhazardous and hazardous wastes. All project wastes (nonhazardous or hazardous) would be disposed of at an approved waste disposal facility authorized to accept such waste. Pangaea Land Consultants, Inc. 29

34 Basis for a Water Supply Assessment Under SB 610, a Water Supply Assessment (WSA) must be furnished to the local government for inclusion in any environmental documentation for certain projects (as defined in Water Code [a]) subject to the California Environmental Quality Act. Due to increased population and water demands, SB 610 seeks to improve the link between information on water availability and certain land use decisions made by cities and counties. SB 610 takes a significant step toward managing the demand of California s water supply as it provides regulations and incentives to preserve and protect future water needs. SB 610 coordinates local water supply and land use decisions to help provide California s cities, farms, rural communities and industrial developments with adequate water supplies. WSAs are required by SB 610 to analyze supply provisions for 20 years. The Projects are planned to be operational for a period of 30 years, after which time the equipment and facilities will be properly abandoned. A more conservative approach has been undertaken to extend the analysis from 20 years to 30 years to match the operational life of the Projects. HR2 is anticipated to come on-line in 2014, whereas SmCP2 is expected to be operational in For this reason, this analysis will consider the years 2015, 2020, 2025, 2030, 2035, 2040, and 2045 for the purposes of this WSA. This WSA is formatted according to the Guidebook for Implementation of Senate Bill 610 and Senate Bill 221 of 2001 to assist water suppliers, cities, and counties in integrating water and land use planning, prepared by the California Department of Water Resources (noted as Reference 1). Section 1 Does SB 610 apply to the proposed development? 1-1 Is the project subject to CEQA? Water Code 10910(a) The Projects are determined to be subject to the California Environmental Quality Act (CEQA) by the Imperial County Department of Planning and Development Services. A Draft Environmental Impact Report is being prepared to address the potential impacts of the Projects under CEQA. It is anticipated that, similar to the Hudson Ranch I Project, the Draft EIR will be prepared, assessing the Project s consistency with the 1981 Salton Sea Anomaly Master EIR, with any mitigation measures noted. 1-2 Is it a project as defined by Water Code 10912(a) or (b)? After review of Water Code Section 10912, the HR2 Geothermal Project and associated SmCP2 Materials Processing Project are collectively deemed a project under the Water Code because it proposes a project with a water demand equivalent to, or greater than, the amount of water required by a residential development of 500 dwelling units. Section 2 Who will prepare the SB 610 assessment? 2-1 Is there a public water system ( water supplier ) for the project? Water Code 10910(b) No. IID is not a public water system for the purposes of SB 610 (See Appendix, Item B). IID is the regional wholesale water supplier and should be involved in a consultation role during the preparation of the WSA. While SB 610 requires a public water system to prepare Pangaea Land Consultants, Inc. 30

35 the WSA, it does provide for the Lead Agency to step into this role when there is no public water system. In this case, with Imperial County as the Lead Agency, they are responsible for the preparation of the WSA. Similar to the preparation of the environmental documentation, however, the County does not actually produce the document and it is prepared, instead, by an outside consultant. Therefore, Pangaea Land Consultants, Inc. is preparing the WSA for Imperial County on behalf of the Project Applicant. Section 3 Has an assessment already been prepared that includes this project? 3-1 Has this project already been the subject of an assessment? Water Code 10910(b) No. This rural site is not within an urbanized area and has not been included in any prior water assessments. The water supplier or the Lead Agency must prepare the SB 610 assessment. Again, Pangaea Land Consultants, Inc. is preparing the WSA for Imperial County on behalf of the Project Applicant. This WSA was originally prepared by Pangaea Land Consultants, Inc., dated October 8, This update is prepared to modify the water request for HR2 and include the water request for SmCP2. Section 4 Is there a current Urban Water Management Plan (UWMP)? 4-1 Has this project already been the subject of an assessment? Water Code 10910(b) No. IID had a Regional Urban Water Management Plan, last updated in 2000, which has been deemed obsolete. This is as a result of a determination by the California Department of Water Resources that IID is not required to comply with the Urban Water Management Plan Act (See Appendix, Items B and C). An assessment must therefore be prepared based on available information. Per Water Code 10910(c)(3), if the Lead Agency will prepare the SB 610 assessment (Water Code 10910(c)(4)), the assessment shall include a discussion as to whether the total projected water supplies, determined to be available during normal, single dry, and multiple dry years during a 30-year projection, will meet the projected water demand associated with the proposed project, in addition to existing and planned future uses, including agricultural and manufacturing uses. 4-2 Is the projected water demand for the project accounted for in the most recent UWMP? Water Code 10910(c)(2) No. As noted in 4-1, the California Department of Water Resources has determined that IID is not required to comply with the Urban Water Management Plan Act (See Appendix, Items B and C). An assessment must therefore be prepared based on information available from other sources and reports. Pangaea Land Consultants, Inc. 31

36 Supply Verification Section 5 What information should be included in an assessment? The question to be answered is: Will IID s total projected water supplies available during normal, single dry, and multiple dry water years during a 30-year projection meet the projected water demand of the Projects, in addition to IID s existing and planned future uses, including agricultural and manufacturing uses? Supplies from IID, as the water wholesaler, require documentation. The following section includes documentation identifying and quantifying water rights, contracts, and/or entitlements to the supply; associated capital outlay programs; federal, state and local permits for constructing infrastructure for conveying the supply; and any necessary regulatory approvals required for conveyance. Section 5, Step One: Documenting wholesale water supplies IID will become the wholesaler of water to the Projects, which will utilize raw water from the adjacent O Lateral, Gate 28, for the industrial operations of the geothermal power generation project and materials processing project (HR2 and SmCP2). Documenting supplies to the wholesale water provider is addressed in Section 5, Step Two. Section 5, Step Two: Documenting supply to IID (the wholesale water supplier) Identify and quantify the existing and planned sources of water available to IID in 5-year increments for the 30-year projection. For each identified supply detail the quantity available and whether it is a: (1) water supply entitlement (2) water right (3) water service contract 1 Background The Imperial Valley depends solely on the Colorado River for surface water delivery. IID imports raw water from the Colorado River and distributes it primarily for agricultural use (97%) 2. The remaining three percent is distributed to the Valley s seven municipalities, one private water company, and two community water systems for treatment to potable standards and distribution as domestic water, and to industrial users. Rainfall is less than three inches per year and does not currently contribute to IID s water supply, although at times it may reduce agricultural water demand. The groundwater in the Imperial Valley is of poor quality and is generally unsuitable for domestic or irrigation purposes, though some is pumped for industrial use. The Imperial Irrigation District (IID) was formed in 1911, under the California Irrigation District Act, to acquire properties of the bankrupt California Development Company and its Mexican subsidiary to import raw Colorado River water and distribute it. By 1922, IID had acquired 13 mutual water companies, 1 Guidebook for the Implementation of Senate Bill 610 and Senate Bill 221, California Department of Water Resources, October 8, 2003, p Pangaea Land Consultants, Inc. 32

37 which had developed and operated distribution canals in the Imperial Valley. By the mid-1920s, IID was delivering water to nearly 500,000 acres. Since 1942, water has been diverted at Imperial Dam on the Colorado River into the All- American Canal (AAC), both of which IID operates and maintains. 3 Colorado River Water Rights 4 The IID's rights to appropriate Colorado River water are long-standing. Beginning in 1885, a number of individuals, as well as the California Development Company, made a series of appropriations of Colorado River water under California law for use in the Imperial Valley. Pursuant to then-existing California laws, these appropriations were initiated by the posting of public notices for approximately 7 million acre-feet per year (AFY) at the point of diversion and recording such notices in the office of the county recorder. The individual appropriations were subsequently assigned to the California Development Company, whose entire assets, including its water rights, were later bought by the Southern Pacific Company. The IID was formed in On June 22, 1916, the Southern Pacific Company conveyed all of its water rights to the IID. The IID's predecessor right holders made reasonable progress in putting their pre-1914 appropriative water rights to beneficial use. By 1929, 424,145 acres of the Imperial Valley's approximately one million irrigable acres were under irrigation. Colorado River water rights are governed by numerous compacts, state and federal laws, court decisions and decrees, contracts, and regulatory guidelines collectively known as the Law of the River. Together, these documents allocate the water, regulate land use and manage the Colorado River water supply among the seven basin states and Mexico. Of all regulatory literature that governs Colorado River water rights, the following are the specifics that impact IID: Colorado River Compact (1921) With the authorization of their legislatures and at the urging of the federal government, representatives from the seven Colorado River basin states began negotiations regarding the distribution of water from the Colorado River in In November of 1922, an interstate agreement called the Colorado River Compact was signed by the representatives giving each basin perpetual rights to annual apportionments of 7.5 million acre-feet (MAF) of Colorado River water. Boulder Canyon Project Act (1929) Pursuant to the provisions of the Boulder Canyon Project Act adopted in 1929, the California Limitation Act, and the Secretary's contracts with the California water users, California was apportioned 4.4 million AFY out of the lower basin allocation of 7.5 million AFY, plus 50% of any available surplus water. Further apportionment of California's share of Colorado River water was made by the Secretary of the Interior by entering contracts with California right 3 Imperial Irrigation District 2005 Annual Water Report, p Ibid. Pangaea Land Consultants, Inc. 33

38 holders. The Secretary entered into a permanent service water delivery contract with the IID on December 1, The District undertook to pay the cost of the works (Imperial Dam and the All-American Canal), and to include within itself certain public lands of the United States and other specific lands. The United States undertook to deliver to the Imperial Dam the water which would be carried by the new canal to the various lands to be served by it. The IID's contract with the Secretary incorporated the provisions of the Seven-Party Agreement. The IID's contract has no termination date; it is a contract for permanent water service. California Seven-Party Agreement (1931) On November 5, 1930, the Secretary of the Interior requested the California Division of Water Resources to recommend a proper method of apportioning the water which California was entitled to receive under the 1922 Colorado River Compact and the Boulder Canyon Project Act. Thereafter, a number of users and prospective users of Colorado River water entered into the Seven-Party Agreement on August 18, The Seven-Party Agreement provided a schedule of apportionments and priorities, and the parties requested "the Division of Water Resources to, in all respects, recognize said apportionments and priorities in all matters relating to State authority and to recommend the [apportionment and priority provisions] to the Secretary of the Interior of the United States for insertion in any and all contracts for water made by him pursuant to the terms of the Boulder Canyon Project Act " The Seven-Party Agreement states the following apportionments and priorities: TABLE 1 Seven-Party Agreement for Apportionments and Priorities 5 Priority Description Acre-feet Annual 1 Palo Verde Irrigation District--gross area of 104,500 acres 2 Yuma Project (Reservation District) - not exceeding a gross area of 25,000 acres 3,850,000 3a Imperial Irrigation District and lands in Imperial and Coachella Valleys to be served by AAC 3b Palo Verde Irrigation District--16,000 acres of mesa lands 4 Metropolitan Water District and/or City of Los Angeles 550,000 and/or others on coastal plain Subtotal 4,400,000 5a Metropolitan Water District and/or City of Los Angeles 550,000 and/or others on coastal plain 5b City and/or County of San Diego 112,000 6a Imperial Irrigation District and lands in Imperial and Coachella Valleys 300,000 6b Palo Verde Irrigation District--16,000 acres of mesa lands 7 Agricultural use all remaining water TOTAL 5,362,000 5 East Brawley Geothermal Development Project SB 610 Water Supply Assessment Review letter, February 12, 2009, p. 13. Pangaea Land Consultants, Inc. 34

39 As a result of the Seven-Party Agreement, with respect to the signatory parties, the IID agreed to limit its California pre-1914 appropriative water rights in quantity and priority to the apportionments and priorities contained in the Seven-Party Agreement. IID State Applications and Permits Following execution of the Seven-Party Agreement, the IID filed eight applications with the California Division of Water Rights between 1933 and 1936 to appropriate water pursuant to the California Water Commission Act. The IID applications each reserved the pre-1914 appropriative rights. However, the applications also incorporated the terms of the Seven- Party Agreement, thus incorporating the apportionment and priority parameters of the Seven-Party Agreement into IID's appropriative applications. Permits were granted on the applications in A summary of the issued permits is as follows: TABLE 2 Issued Permits Summary 6 Permit AFY1 Place of Diversion Purpose of Use Number ,239, Imperial Dam Irrigation and domestic ,791,744.2 Imperial Dam Power-related ,343, Imperial Dam Power-related ,791,744.2 Imperial Dam Power-related ,791,744.2 Imperial Dam Power-related ,791,744.2 Imperial Dam Power-related ,411, Imperial Dam Power-related ,447, Imperial Dam Power-related The Subordination by Coachella Valley Water District At the time the IID entered into its contract with the Secretary of the Interior, it was anticipated that the lands to be served with Colorado River water in the Coachella Valley to the north would also become a part of the IID. However, the Coachella farmers eventually decided that they preferred to have their own delivery contract with the Secretary, and an action was brought by the Coachella Valley Water District (CVWD) to protest the IID's court validation of the 1932 IID water service and repayment contract with the Secretary of the Interior. In 1934, IID and CVWD executed a compromise agreement which paved the way for CVWD to have its own contract with the Secretary, but which provided that CVWD would subordinate its Colorado River entitlement, in perpetuity, to the IID entitlement. In other words, within the third, sixth and seventh priority agricultural pool, as set forth in the Seven- Party Agreement and the various California water delivery contracts, IID's water use takes precedence over CVWD's use. As a practical matter, under the third priority, CVWD receives what is left over from the 3.85 million AFY agricultural pool after uses by Palo Verde, the Yuma project, and IID are deducted. 6 East Brawley Geothermal Development Project SB 610 Water Supply Assessment Review letter, February 12, 2009, p. 14. Pangaea Land Consultants, Inc. 35

40 In summary, the IID has senior water rights to the Colorado River established under state law, when California is limited to 4.4 million AFY, in the amount of 3.85 million AFY minus the amounts used by Priorities 1 and 2. Priorities 1 and 2 are not fixed quantities and have ranged between 364,817 AFY and 602,181 AFY over the last 25 years. 7 IID Present Perfected Rights and the Arizona v. California US Supreme Court Decision (1964, 1979) The term "Present Perfected Rights" first appeared in the Colorado River Compact executed on November 24, The Compact provided that "Present Perfected Rights to the beneficial use of waters of the Colorado River system are unimpaired by this Compact." Section 6 of the Boulder Canyon Project Act, effective on June 25, 1929, recognized and protected these rights by providing that "the dam and reservoir... shall be used; second, for irrigation and domestic uses and satisfaction of Present Perfected Rights in pursuance of Article VIII of said Colorado River Compact...." (emphasis added). Pursuant to the terms of the Boulder Canyon Project Act, California's 4.4 million AFY of mainstream water was to be used to satisfy "any rights which existed on December 21, 1928." Such "rights" included "Present Perfected Rights" within the IID's pre-1914 state-law appropriative rights. Although the United States Supreme Court in Arizona v. California defined "Perfected Right" and "Present Perfected Rights" in its 1964 Decree, IID's Present Perfected Rights were not quantified until the Supreme Court issued a Supplemental Decree in That Supplemental Decree defined IID's Present Perfected Rights as a right to Colorado River water: In annual quantities not to exceed (i) 2,600,000 acre-feet of diversions from the mainstream or (ii) the consumptive use required for irrigation of 424,145 acres and for the satisfaction of related uses, whichever of (i) or (ii) is less, with a priority date of IID's Present Perfected Rights are very important because Article II(B)(3) of the Supreme Court Decree provides that in any year in which there is less than 7.5 million acre-feet of mainstream water available for release for consumptive use in Arizona, California and Nevada, the Secretary of the Interior shall first provide for the satisfaction of Present Perfected Rights in the order of their priority dates without regard to state lines before imposing shortage cutbacks on other junior water right holders. 8 Note: Throughout this document, net consumptive use is defined as per United States Bureau of Reclamation Colorado River Accounting and Water Use (Decree Accounting) at Imperial Dam not with any other accounting. Colorado River Basin Project Act (1968) In 1968, various water development projects in both the upper and lower basins, including the Central Arizona Project (CAP), were authorized by Congress. Under the act, priority was given to California s apportionment before the CAP water supply in times of shortage. Also under the act, the Secretary was directed to prepare long-range criteria for the Colorado 7 East Brawley Geothermal Development Project SB 610 Water Supply Assessment Review letter, February 12, 2009, p. 15, and calculations from Derek Dessert, Design Development & Engineering, as ed to Anisa Devine, June 10, Ibid, p Pangaea Land Consultants, Inc. 36

41 River reservoir system in consultation with the Colorado River Basin states. Quantification Settlement Agreement (2003) Due to completion of a large portion of the CAP infrastructure in 1994, creation of the Arizona Water Banking Authority in 1996, and the growth of Las Vegas in the 1990s, California encountered increasing pressure to live within its rights under the Law of the River. After years of negotiating among Colorado River Compact States and affected California water delivery agencies, a Quantification Settlement Agreement (QSA) and related agreements and documents were signed by the Secretary of Interior, IID, Coachella Valley Water District (CVWD), Metropolitan Water District (MWD), the San Diego County Water Authority (SDCWA), and other affected parties on October 10, More on the QSA is provided under Section 5, Step Three Documenting Project Demand (Project Demand Analysis). The QSA represents the amount of water delivered to IID for the term of the QSA ( , or 2075). For dry and multiple dry water years, the Supply/Demand Imbalance (SDI) governs. More on the SDI is provided under Section 5, Step Four Documenting dry year(s) supply for water suppliers with multiple sources. With the execution of the QSA, IID s consumptive uses were capped at 3,100,000 acre-feet (3.1 MAF) for the term of the QSA. This annual water limit creates complicated accounting for both IID and United States Bureau of Reclamation (USBR), and is still evolving. The data included herein represents IID s first attempt to consolidate USBR and IID figures in a simplified annual format for purpose of preparing WSAs. As IID continues to develop the WSA templates through the Integrated Water Resource Management Plan (IWRMP), and work with USBR to develop consolidated accounting formats, the presentation of these values is likely to be refined and updated. The 3.1 MAF annual cap and water conservation and transfer programs also present unique challenges for WSA analysis purposes, as data prior to 2003 cannot always simply be compared or averaged with pre-qsa data absent additional data rectification or benchmarking. The Secretary of the Interior shall deliver Imperial Irrigation District s Priority 3(a) consumptive use entitlement under this Colorado River Water Delivery Agreement, pursuant to this Exhibit A and Exhibit B hereto as follows: Pangaea Land Consultants, Inc. 37

42 TABLE 3 Colorado River Water Delivery Agreements 9 Delivered to (entity): At (point of diversion): * Note: By IID and MWD agreement, the 1988 IID/MWD transfer has been fixed at 105,000 AFY, beginning in calendar year Notes to Imperial Irrigation District: 1. Agreement for the Implementation of a Water Conservation Program and Use of Conserved Water, dated December 22, 1988; Approval Agreement, dated December 19, Of amount identified: up to 90,000 AF to MWD and 20,000 AF to CVWD. 2. Water conserved from construction of a new lined canal parallel to the All-American Canal from Pilot Knob to Drop Agreement for Transfer of Conserved Water, dated April 29, 1998, as amended. As set forth in Exhibit B, delivery amounts shall be 205,000 AF in calendar year 2021, and 202,500 AF in calendar year Water conserved from All-American Canal lining project and made available for benefit of San Luis Rey Settlement Parties under applicable provisions of Pub. L. No , as amended. Quantity may vary, not to exceed 16,000 AFY, as may the point of diversion, subject to the terms of the Allocation Agreement. 5. Water to be delivered to miscellaneous and Indian PPRs identified in the Decree in Arizona v. California, as supplemented. The delivery of water will be to current points of delivery unless modified in accordance with applicable law. 6. As provided in subsection 4(g) of this agreement. Amount not to exceed (AF): CVWD Imperial Dam 103,000 MWD Lake Havasu 110,000 * 1 SDCWA Lake Havasu 56,200 2 SDCWA Lake Havasu 200,000 3 SLR see note 4 see note 4 4 Misc. & Indian PPRs Current points of delivery 11,500 5 For benefit of MWD/SDCWA Lake Havasu 145,000 6 IID Imperial Dam Remainder IID s Priority 3(a) Total 3,100,000 Notes 9 Exhibit A of the Colorado River Water Delivery Agreement (CRWDA) ( Pangaea Land Consultants, Inc. 38

43 Section 5, Step Two: Documenting supply if groundwater is a source Groundwater is not proposed for use as part of the Project. Additionally, IID as the water wholesaler, does not derive any of its supplies from groundwater in the Imperial Valley, as it is of poor quality and is unsuitable for domestic or irrigation use due to a high range of total dissolved solids (TDS), fluoride concentration, and boron concentration. Groundwater TDS ranges from hundreds to an extreme of tens of thousands of milligrams per liter (ppm). 10 Chapter 7 of the Salton Sea Ecosystem Restoration Program Draft Programmatic Environmental Impact Report (CDWR, et al., 2007) contains a detailed description of the Imperial Valley Basin. Regarding usage of groundwater, the report (p 7-5) states: Groundwater quality varies extensively in the Imperial Valley Basin. Total dissolved solids, a measure of salinity, ranged from 498 to 7,280 mg/l (CDWR, 2003). High concentrations of fluoride have been reported (IID and USBR, 2002b). Due to the low yield and poor water quality, few production wells have been drilled in the Imperial Valley. Most of the wells in the Imperial Valley are domestic wells. Total production from these wells is estimated to be a few thousand acre-feet per year (Salton Sea Authority, 1999). Extremely deep groundwater has been developed along the southern Salton Sea shoreline for geothermal resources. These wells access non-potable groundwater from several thousand feet below ground surface. 11 Surface water is dependent on the inflow of irrigation water from the Colorado River, and is nonpotable without treatment. There are three general categories of surface water in the Imperial Valley: freshwater, brackish water, and saline water. The freshwater (with TDS generally less than 1,000 ppm) includes all Colorado River inflows delivered by the All American Canal and other canals and laterals within IID s Service Area. Brackish water (with TDS in the range of 2,000 to 4,000 ppm) can be found within the Alamo River, New River, and the agricultural drains that discharge into these rivers or directly to the Salton Sea. The Alamo River derives nearly all of its flow from the irrigation water return flows (tailwater and tile water) in the Imperial Valley. The New River derives roughly 65 percent of its volume from irrigation water return flows from the Imperial Valley, with the remaining 35 percent derived from drainage that flows from the Mexicali Valley across the International Border. Saline water (with inflow TDS above 4,000 ppm) makes up the Salton Sea, as its salinity is approximately 44,000 ppm. 12 IID serves as the regional water supplier by importing raw Colorado River water and delivering it to agricultural, municipal and industrial water users within its service area. The Imperial Dam is located 20 miles northeast of Yuma Arizona, and serves as IID s point of diversion from the Colorado River to the All American Canal. The All American Canal is an 80-mile long gravity flow canal that services the Imperial Valley via 150 miles of three main canals: East Highline, 10 IID RPM Section. 11 IID 2007 Water Conservation Plan, p Salton Sea salinity from Salton Sea Salinity and Saline Water at Pangaea Land Consultants, Inc. 39

44 Central Main, and Westside Main. Through 1,438 miles of lateral canals, IID is able to deliver water throughout the Imperial Valley. Alternative Water Supply Sources Considered: The Projects have two principal water requirements cooling tower makeup water, and brine dilution/process water. Each has distinctly different requirements as to the quality of the water which can be used for each purpose: Cooling tower makeup requires water low in total dissolved solids (TDS) and sulfates, as the concentration of the TDS and sulfates in the circulating cooling water typically are the limiting factors in determining the cycles of concentration and the rate of cooling water blowdown, which in turn affects the amount of cooling makeup water required. Brine dilution/process water, required to prevent the precipitation of salts in the brine handling facility, requires relatively neutral or low ph water to prevent the precipitation of metals in the brine processing facility reactor which creates fine particulates which do not settle out in the brine processing facility clarifier. Water is also mixed with the brine to assist in the proprietary process of extracting lithium, zinc and manganese, and excessive impurities in the water can negatively impact project purity. Considering these principal uses, alternative water sources derived directly by the Projects have been considered. The following alternative water supply sources are considered in the order they are listed in Principle 1 of the California State Water Resources Control Board Resolution No , Water Quality Control Policy on the use and Disposal of Inland Waters Used for Powerplant Cooling, adopted June 19, Wastewater to the ocean none are available at this site. 2. Ocean water none are available at this site. 3. Brackish water (agricultural drain water, or tailwater) The use of agricultural drain water at this site was evaluated and dismissed as economically unsound. The agricultural drain water is of relatively high salinity (generally around 12,000 to 16,000 mg/l total dissolved solids), and very high in sulfates. This makes it essentially unusable for cooling tower makeup water without substantial pretreatment to remove the sulfates and lower the TDS. This pre-treatment cost (using reverse osmosis) of drain water for use as cooling tower makeup water is estimated by the IID at $500 to $2,000 per acre-foot. The high TDS and sulfates also make the agricultural drain water a poor candidate for use as brine dilution water without pretreatment, as these same sulfates would otherwise chemically react with the geothermal brines. The annual cost of reverse osmosis pre-treatment of the 2,000 AFY of water needed by the project would be $1,000,000 to $4,000,000. In addition, these reverse osmosis treatment systems also produce highly concentrated waste brines which, when injected into the plant injection well, would react with the geothermal fluid in the reservoir, precipitating various mineral sulfates, scaling the plant injection well and adjacent geothermal reservoir. This injection of the brine is expected to double the frequency of cleanouts of the plant injection well, creating an additional average annual cost of $1,250,000. Thus, the total annual cost of using reverse osmosis to pre-treat agricultural drain water is estimated at $2,250,000 to $5,250,000 ($1,125 to $2,625 per acre-foot). This is from three to seven times as expensive as the use of irrigation water for the same purposes. If instead the agricultural drain water is used as brine dilution water without pretreatment, the sulfates would chemically react with the geothermal brines, precipitating Pangaea Land Consultants, Inc. 40

45 barium sulfate with naturally occurring radioactive materials (NORMS) with the silica waste. Adding the NORMs to the precipitated silica transforms this useful cement feedstock material into hazardous waste, which adds about $6,500 per day (or about $2,400,000 per year) in waste disposal costs. This is approximately $3,315 per acre-foot of agricultural drain water used for brine dilution, or nearly nine times the cost of irrigation water for this same purpose. The use of agricultural drain water for the Projects was also dismissed as environmentally undesirable. Agricultural drain water would need to be obtained from the IID s drains in the area, which in their lower reaches (adjacent to the Hudson Ranch I power plant site) are known to be periodically inhabited by desert pupfish (Cyprinodon macularius), a state and federal listed endangered fish species. Removal of drain water could adversely affect the desert pupfish and its habitat, and could not be undertaken without a detailed review by, and the approval of, both the U.S. Fish and Wildlife Service and the California Department of Fish and Game. This review and approval process is of indeterminate length and unknown outcome. Use of drain water for brine dilution without pre-treatment would also produce substantial volumes of hazardous waste, which would unnecessarily consume limited hazardous waste disposal capacity. 4. Brackish water (shallow ground water) The use of ground water at this site was also evaluated and dismissed as environmentally undesirable. The project site and vicinity are each known to possess a shallow artesian ground water system. However, these shallow waters are also supersaturated with carbon dioxide, are brackish and of elevated temperature. Historically, a substantial number of wells were drilled in this area for the production of carbon dioxide, each of which also produced substantial quantities of water. A review of the historical records indicates that the production and use of this shallow water for process dilution or cooling would bring environmentally undesirable consequences. The wells previously drilled for the production of carbon dioxide were prone to blow-outs, both during drilling and, in several instances, long after the wells had been completed, resulting in substantial discharges of both saline water and carbon dioxide. Production of these shallow ground waters would also result in the co-production of vast quantities of carbon dioxide which, as a greenhouse gas, would exacerbate the potential for global warming. Under developing regulatory schemes, these carbon dioxide emissions would need to be captured (though a carbon dioxide separation and collection system) and sequestered (possibly into the geothermal reservoir through an additional plant injection well). The production and use of this shallow ground water is also economically unsound. The elevated temperature of this shallow ground water (reported at 200 F or higher) would add a substantial thermal load to the cooling towers, requiring additional cooling capacity from the cooling towers and consuming additional cooling water. The cost of a carbon dioxide separation and collection system and an additional plant injection well are estimated at $5,000,000 in initial capital expenditures and $500,000 in average annual operating expenses for well cleanout costs. The shallow ground water salinity is reported as around 16,000 mg/l total dissolved solids (TDS), and very high in sulfates. Like the agricultural drain water, this makes it unusable for cooling tower makeup water without substantial pre-treatment to remove the sulfates (using reverse osmosis), at a cost of $500 to $2,000 per acre-foot. Also, like the drain water, using the shallow ground water for brine dilution without pre-treatment would cause the high sulfate concentrations to chemically react with the geothermal brines, precipitating barium sulfate with naturally Pangaea Land Consultants, Inc. 41

46 occurring radioactive materials (NORMS) with the silica. This would transform the feedstock material into hazardous waste, which adds about $6,500 per day in waste disposal costs. These reverse osmosis treatment systems also produce highly concentrated waste brine which would react with the geothermal fluid when injected into the geothermal reservoir, which would double the frequency of well cleanouts at an average additional annual cost of $500,000. Added together, the total annual cost of controlling carbon dioxide emissions and using reverse osmosis to pre-treat saline shallow ground water is estimated at $1,600,000 to $2,800,000 ($2,000 to $3,500 per acre-foot). This is from over five to over nine times as expensive as the use of irrigation water for the same purposes. The same can be said for the canal water to be used as Simbol process water. 5. Inland wastewaters (geothermal steam condensate) The proposed use of geothermal steam condensate for power plant cooling and other plant uses at this site has been evaluated and determined to be both environmentally desirable and economically sound. The Projects will produce approximately 2,740 acrefeet/year of very low salinity geothermal steam condensate. Hudson Ranch proposes to use this steam condensate as cooling tower makeup water for the project. The steam condensate will supply a substantial portion of the cooling tower makeup water demand for the project. The use of this steam condensate water for cooling tower makeup allows the cooling tower to achieve as many as twenty cycles of concentration before blowdown is required, which normally occurs as a result of the buildup of sulfates in the circulating cooling water. This minimizes the amount of water required for cooling tower makeup. Once in operation, Hudson Ranch will evaluate the ability to economically increase the cycles of concentration in the cooling tower so as to further reduce the quantity of blowdown and, potentially, eventually eliminate the need for the portion of irrigation water requested that is allocated for cooling tower makeup water. As an additional benefit, geothermal steam condensate will be used as process water by Simbol to maximize product purity to the extent available. 6. Inland wastewaters (managed marsh wastewaters) There is a potential for the use of wastewater from IID s managed marsh system in this area, though Hudson Ranch believes that it is premature to evaluate either the environmental desirability or the economical feasibility of using such water. IID is just beginning the operation of the first managed marsh cells, and at this time it is unknown how much water of what quality would be released by IID (into the O Drain or a dedicated collection system) which could be intercepted and conveyed to the Projects for servicing any of the plant water needs. Once the quantity and quality of this water source is better understood, Hudson Ranch may be able to evaluate the environmental or economic feasibility of using this water for brine dilution, cooling or other plant uses. As discussed, the concentration of sulfates and other deleterious constituents in these waters will be key in determining whether or not they are environmentally undesirable and economically unsound. 7. Other inland waters none have been identified. Best Management Practices to Reduce IID Water Demand: The California Energy Commission (CEC) Best Management Practices & Guidance Manual: Desert Renewable Energy Projects [Revised Draft Staff Report December 2009] (CEC BMPs Report), Chapter 3, General Pre-Application Filing Guidance & Best Management Practices, lists the following BMPs under Water Supply and Quality generally applicable to all renewable Pangaea Land Consultants, Inc. 42

47 energy projects in the desert region; Hudson Ranch and Simbol s responses/compliance are included: 1. Ensure that any wastewater generated in association with temporary, portable sanitary facilities is periodically removed by a licensed hauler and disposed into an existing municipal sewage treatment facility. [Hudson Ranch and Simbol have committed to such practices in their application for the Imperial County Conditional Use Permit.] 2. Temporary, portable sanitary facilities provided for construction crews should be adequate to support expected on-site personnel and should be removed at completion of construction activities. [Hudson Ranch and Simbol have committed to such practices in their application for the Imperial County Conditional Use Permit.] 3. Consider cleaning company vehicles at commercial car washes rather than washing vehicles on the company's property so that dirt, grease, and detergents are treated effectively at existing facilities designed to handle those types of wastes. [Hudson Ranch and Simbol have committed to such practices in their application for the Imperial County Conditional Use Permit.] 4. Comply with local requirements for permanent, domestic water use and wastewater treatment. [Hudson Ranch and Simbol have agreed to such practices in the Imperial County Conditional Use Permit.] On 09/14/10 the CEC announced the availability of the draft final BMP's: The Renewable Energy Action Team (REAT) completed the Best Management Practices and Guidance Manual: Desert Renewable Energy Projects and the four agencies (California Dept. of Fish and Game, Energy Commission, U.S. Bureau of Land Management, and Fish and Wildlife Service) approved the manual. The manual is available at 009/REAT F.PDF The approval followed public review and extensive public comment periods in 2009 and The Best Management Practices and Guidance Manual: Desert Renewable Energy Projects provides recommendations to renewable energy developers and federal, state, local, and tribal governments for improving the efficiency of the regulatory process in California and protecting environmental and cultural resources, and human health and safety. The manual recommends critical actions, a process for initiating permitting discussions, guidance, and BMPs for timely processing of desert renewable energy project permits within the established regulatory framework. From p. 77 under Water Supply for Chapter 4, Renewable Energy Technology Specific BMPs, Geothermal Energy Power Plant BMPs, Flash-steam geothermal power plants can satisfy some of their water supply needs by recycling steam condensed from produced geothermal brine. However, they require an external supply source for cooling tower make up water (CE Obsidian Energy, LLC 2009). In addition to the above, Hudson Ranch has committed to the following fresh water use reduction BMPs: Use of high-efficiency drift eliminators for the reduction of drift losses. Operating the brine processing facility to minimize brine carryover into the steam condensate to minimize salt levels in the steam condensate delivered to the cooling tower, and thus maximize the cooling tower cycles of concentration. Pangaea Land Consultants, Inc. 43

48 To the limits of storage capacity and chemical compatibility, store excess steam condensate during cool weather operations in the freshwater storage pond for use during warmer weather. To the extent economically and technologically feasible, salvage storm waters from the storm water collection pond and use for cooling tower makeup. Evaluate the technical and economic feasibility of increasing the cooling tower cycles of concentration to minimize or eliminate the need for irrigation water for cooling water makeup. Hudson Ranch and Simbol have proposed full conformance with all of the applicable CEC water use BMPs. Pangaea Land Consultants, Inc. 44

49 Section 5, Step Two: Documenting supply if the assessment relies on water supplies never before used Current legislative planning processes require new project approvals to be based on accurate information regarding long-term water supply conditions relevant to each project. The preparation of water supply assessment and verification planning documents, absent a policy addressing new project development, is proving complicated given IID s existing water supply conditions; on-going drought on the Colorado River system; the triggering of field-level apportionments based on the 2009 supply demand imbalance declaration (as per the equitable distribution pilot program); and IID s overrun of its annual entitlement in three out of the last six years. The adoption of an interim water supply policy for new non-agricultural projects would facilitate the development approval process by ensuring a verifiable long-term water supply. This interim policy will provide a better planning process and is intended to transition into strategies and funding mechanisms being developed under the IWRMP to supply new nonagricultural demands. 13 IID is developing an Integrated Regional Water Management Plan (IRWMP) to address the development of additional water supplies for new non-agricultural projects. The IRWMP is intended to identify and prioritize long-term water supply augmentation and demand management opportunities. The IRWMP: Describes future short-, mid-, and long-term non-agricultural water use demand scenarios. Identifies, quantifies, and costs out new local, regional, and imported water supply opportunities. Recommends demand management plans, non-agriculture water use best management practices (BMPs), drought management strategies, emergency contingency plans, and policies for non-agricultural water uses. Assesses new opportunities for IID to provide water-related services within its service area. Evaluates water quality, reliability, and costs for demand and supply scenarios. Identifies regulatory compliance requirements associated with future water demand and supply scenarios. Assesses IID s current level of service based on records and recommend changes, as appropriate. Evaluates water supply costs, water rates, pricing structures, and funding sources. Prioritizes recommendations for IID Board decision-making purposes. Streamlines the approval process that agencies such as IID, Imperial County, and local municipalities use when considering land use plans and development proposals that require new or expanded water supplies, and help agencies comply with state laws. In the past, IID did not have a policy in place to address new project demands, except on a case-by-case basis. Through the IRWMP process, IID is working to develop long-term water supply augmentation through methods such as water banking, recycling of municipal wastewater, treatment of agricultural tail water, and others. These will be utilized primarily for new non-agricultural projects that will require a greater amount of water than is currently utilized by agriculture on their development footprint. A number of alternatives for such a strategy have 13 Agenda, Imperial Irrigation District, Action/Informational Meeting of April 14, 2009, p. 37. Pangaea Land Consultants, Inc. 45

50 been considered for the Projects in Section 5, Step Two: Documenting supply if groundwater is a source, Alternative Water Supply Sources Considered. For the interim time until the adoption of the IRWMP (anticipated in 2012), IID has developed their Interim Water Supply Policy for Non-Agricultural Projects, adopted as policy on September 29, 2009, including the fee schedule tables. This policy, which is included as Appendix A, states: The IRWMP will enable the District to more effectively manage existing water supplies and to maximize the District's ability to store or create water when the available water supplies exceed the demand for such water. The stored water can be made available for later use when there is a higher water demand. Based upon known pending requests to the District for water supply assessments/verifications and pending applications to the County of Imperial for various Non-Agricultural Projects, the District currently estimates that up to 50,000 acre feet per year (AFY) of water could potentially be requested for Non-Agricultural Projects over the next ten to twenty years. Under the IRWMP the District shall evaluate the projected water demand of such projects and the potential means of supplying that amount of water. This IWSP currently designates up to 25,000 AFY of water for potential Non-Agricultural Projects within IID's water service area. Proposed Non-Agricultural projects may be required to pay a Reservation Fee, further described below. The reserved water shall be available for other users until such Non- Agricultural projects are implemented and require the reserved water supply. This IWSP shall remain in effect pending the approval of further policies that will be adopted in association with the IRWMP. 14 The IWSP establishes a schedule for Processing Fees, Reservation Fees, and Connection Fees for all non-agricultural projects, and annual Water Supply Development fees for some nonagricultural projects. The HR2 Geothermal Project and SmCP2 Processing Project industrial uses will be subject to the annual Water Supply Development fee. 14 IID Interim Water Supply Policy for Non-Agricultural Projects, 2.0 Background, p. 1 of 5. Pangaea Land Consultants, Inc. 46

51 Project Demand Analysis Section 5, Step Three: Documenting Project demand (Project Demand Analysis) Detailing existing and planned future uses Water Code 10910(c)(3) If the projected water demand associated with the proposed project was not accounted for in the most recently adopted urban water management plan, or the public water system has no urban water management plan, the water assessment for the project shall include a discussion with regard to whether the public water system s total projected water supplies available during normal, single dry, and multiple dry water years during a 30-year projection will meet the projected water demand associated with the proposed project, in addition to the public water system s existing and planned future uses, including agricultural and manufacturing uses. 15 To achieve this, the consumptive use limits placed on IID by the QSA will be considered to be the demand for the service area. Considering that 97% of the water supplied to IID goes to agricultural production, any variations in municipal and industrial use are minor in comparison to this agricultural demand, which is expected to use all the water that is available. The Projects are planned to be operational for a period of 30 years, after which time the equipment and facilities will be properly abandoned. For this reason, the supply provisions time frame required by Senate Bill 610 has been extended from 20 years to 30 years to match the operational life of the Projects. With an initial operating date of late 2014 for the HR2 facility and 2016 for the SmCP2 facility, this analysis will consider the years 2015, 2020, 2025, 2030, 2035, 2040, and 2045 for the purposes of this WSA. This assessment will address the requirements of Water Code 10910(c)(3) in the following manner: 1. Consider the requirements of an Urban Water Management Plan to justify the existing and planned future uses within the service area. 2. Consider the supplies to IID, as limited by the QSA, as equating to the demand within the service area. 3. Consider the projected demand at completion of the proposed Projects. 4. Consider projected supplies available during normal, single dry, and multiple dry water years during a 30-year projection. This is addressed in Section 5, Step Four: Documenting dry year(s) supply. 5. Combine the projected supplies to IID available in normal, single dry, and multiple dry water years with assumptions as to the build-out of the Projects to provide the 30-year projection of demand in years 2015, 2020, 2025, 2030, 2035, 2040, and This is addressed in Section 5, Step Five: Documenting dry year(s) demand. Item 1: Urban Water Management Plan elements describing existing and planned future uses within the service area From a determination by the California Department of Water Resources, IID is not required to comply with the Urban Water Management Plan Act. As a result, IID s last UWMP updated in 15 Guidebook for the Implementation of Senate Bill 610 and Senate Bill 221, California Department of Water Resources, October 8, 2003, p. 24 Pangaea Land Consultants, Inc. 47

52 2000 has been deemed obsolete. Information used to derive an UWMP is considered in this assessment to establish the service area parameters for the existing and future service by IID (see Appendix, Items B and C). Water Code (Urban Water Management Plan Requirements) (a) Describe the service area of the supplier, including current and projected population, climate, and other demographic factors affecting the supplier s water management planning. The projected population estimates shall be based upon data from the state, regional, or local service agency population projections within the service area of the urban water supplier and shall be in five-year increments to 30 years or as far as data is available. (e) (1) Quantify, to the extent records are available, past and current water use, over the same five-year increments described in subdivision (a), and projected water use, identifying the uses among water use sectors including, but not necessarily limited to, all of the following uses: (A) Single-family residential (B) Multifamily (C) Commercial (D) Industrial (E) Institutional and Governmental (F) Landscape (G) Sales to other agencies (H) Saline water intrusion barriers, groundwater recharge, or conjunctive use, or any combination thereof (I) Agricultural (2) The water use projections shall be in the same five-year increments described in subdivision (a). 16 IID Service Area (Supplier) The source of virtually all surface waters in Imperial County is the Colorado River. Water is diverted from the Colorado River at the Palo Verde Weir, north of Blythe by Palo Verde Irrigation District, and at the Imperial Dam through the All-American Canal headworks and desilting basins by Imperial Irrigation District and Bard Irrigation District into the All-American Canal for use in the Bard, Imperial and Coachella Valleys. IID's entitlement of Colorado River water consists of 3.1 million acre-feet per year. Approximately fifty percent of land in Imperial County is undeveloped and under federal ownership and jurisdiction. One-fifth of the nearly 3 million acres in Imperial County is irrigated for agricultural purposes; most notable being the central area known as Imperial Valley. The Imperial Valley area is the south-central part of Imperial County, and is bounded by Mexico on the south, the Algodones Sand Hills on the east, the Salton Sea on the north, San Diego County on the northwest, and the alluvial fans bordering the Coyote Mountains and the Yuha Desert to the southwest. The Imperial Valley Area encompasses a total of 989,450 acres. Imperial Valley 16 Ibid, p. 24. Pangaea Land Consultants, Inc. 48

53 land that is irrigated for agriculture consists of 512,163 acres. 17 IID s open channel gravity flow irrigation and drainage system services this irrigated farmland. The system includes 80 miles of the All-American Canal, 50 miles of drains in the All-American Canal Section, 3 miles of the New Briar Canal and 1,585 miles of other main and lateral canals. A favorable salt balance has been maintained in Imperial Valley soils as approximately 30% more salt was discharged through the district's drainage than was brought into Imperial Valley by importation of Colorado River water for irrigation. This balance is due to the installation of 28,972 miles of underground drain tile in individual fields since It is this adequate drainage system in the Imperial Valley that makes the difference between barren land and highly productive soil. The saline drainage water is carried through the district's drainage canals into the Salton Sea. The number of pipelined canals is increasing for projects within or adjacent to urban areas due to real estate development that is occurring in the Imperial Valley. The developed area, which includes Imperial County s incorporated cities, unincorporated communities and supporting facilities, comprises approximately one percent of Imperial County s area. The Salton Sea accounts for approximately seven percent of Imperial County s surface area. IID has a specific service area that it is responsible for supplying water to primarily for agriculture. In addition to agricultural irrigation, the IID s water service includes providing untreated water for municipal use to the Imperial Valley s seven incorporated cities of Brawley, Calexico, Calipatria, El Centro, Holtville, Imperial and Westmorland. Three unincorporated communities are also included in the service area; Heber, Niland and Seeley. See Figure 7 for a map of the IID water service area. To comply with US Environmental Protection Agency (EPA) requirements and avoid termination of canal water service, residents in the IID water service area who do not receive treated water service must obtain alternative water service for drinking and cooking from a state-approved provider. To avoid penalties that could exceed $25,000 a day, IID strictly enforces this rule. The section tracks nearly 4,000 raw water service accounts required by the California Department of Public Health (CDPH) to have alternate drinking water service. The section maintains a smallacreage pipe and drinking water database, and provides an annual compliance update to CDPH. 18 Agricultural development in the Imperial Valley began at the turn of the twentieth century, and agricultural production of approximately $1.45 billion annually (in 2009) is the mainstay of the local agriculture economy. IID s delivery of Colorado River water to agricultural land and the municipalities that in turn provide water to urban development makes this economy possible. While the agriculture-based economy is expected to continue, land use will vary somewhat over the years as urbanization and growth in non-agricultural economic sectors occur in both rural areas and adjacent to existing urban areas. 17 Imperial County General Plan, Land Use Element, p IID 2007 Water Conservation Plan, p 12, IID RPM, Oct Pangaea Land Consultants, Inc. 49

54 HR2 and SmCP2 Project Location Figure 7: Imperial Unit Service Area Source: IID 2005 Annual Water Report, page 1 Pangaea Land Consultants, Inc. 50

55 Current and Projected Population Imperial County lies in the southeastern corner of California and is comprised of approximately 4,597 square miles or 2,942,080 acres. Imperial County is bordered by San Diego County to the west, Riverside County to the north, the Colorado River/Arizona boundary to the east, and 84 miles of International Boundary with the Republic of Mexico to the south. The Projects are located within Imperial County, south and west of State Highway 111, west of English Road, south of McDonald Road, and 2.5 miles southwest of the community of Niland (Figure 8). Figure 8: Location Map The economy within the Valley is gradually becoming more diverse. Agriculture will likely continue to be the predominant industry; however, two principal factors that will cause a reduction of agricultural acreage are urban development and the economics of the agricultural market. Over the next twenty years, urbanization is expected to slightly decrease agriculture land use in order to provide adequate space for an increase in residential, commercial, and industrial growth. Strong among the future industrial uses are alternative energy production facilities. The majority of urban development should occur in and around the seven incorporated cities Pangaea Land Consultants, Inc. 51

56 and three unincorporated communities. Urban development is expected to remain concentrated near the established urban centers for a more efficient infrastructure layout. Development located in more rural areas will require the provision of private utility systems. As long as they are within the IID Service Area, raw water purchased from IID for treatment and municipal use is the only option. In 2007, some 6,500 people living in Imperial County were outside of the IID service area. Part of the Valley s future urban growth is due to the two international border crossings in the Imperial Unit, the Calexico Port of Entry and the International Port of Entry. The Mexican/United States International Port of Entry is located just east of the City of Calexico. It is expected to facilitate urban development within the Imperial Valley, since the movement of goods and services has increased dramatically due to the creation of the North American Free Trade Agreement (NAFTA). Typical undeveloped areas that are being developed or could likely be developed include areas that surround the incorporated cities and unincorporated areas of the Imperial Valley, as well as unincorporated areas that are defined by specific plans. Specific plans are used to implement the Imperial County General Plan for large development projects such as planned communities, or to designate an area of Imperial Valley where further studies are needed for development like Mesquite Lake. When adopted, a specific plan serves as an amendment to Imperial County s General Plan for a very defined and detailed area. In 2003, the total urban area within the Imperial Valley was 49,760 acres or 4.69% of the total Imperial Valley, which is comprised of 1,061,637 acres. 19 This percentage is likely higher due to real estate development that has occurred between 2003 and the present. Urban areas yet to be developed will be characterized by a full level of urban services, and will contain a broad range of residential, commercial and industrial land uses. It is anticipated that most urban developments yet to be developed will eventually be annexed and incorporated into existing municipal areas, or form new County Service Areas (CSAs), and be provided with a full range of public infrastructure normally associated with urbanized areas. This includes public sewer and water, drainage improvements, street lights, fire hydrants, and fully improved paved streets with curbs, gutters and sidewalks that are consistent with respective municipal standards. The following excerpt is from the Imperial County General Plan Land Use Element with regard to population: Imperial County Planning/Building Department bases its population estimates on building permits and housing unit change. From this annual compilation, the Population Research Unit of the California Department of Finance (DOF) estimates the annual change in population. According to these 2003 estimates, the population estimate for the unincorporated area is 33,750 with the total population estimate for Imperial County being 150,900. This compares to the 19 Total acreage for urban areas within the Imperial Unit was calculated based on information that was available in the Land Use Element of the Imperial County General Plan 2003 Update, pages 7, 8 & 10. Imperial Unit area is from the Imperial Irrigation District 2005 Annual Water Report, page 29. Pangaea Land Consultants, Inc. 52

57 1990 census results of 32,773 for the unincorporated area and 147,361 for the entire County. The seven incorporated cities: Brawley, Calexico, Calipatria, El Centro, Holtville, Imperial, and Westmorland, account for 75 percent of the total population. In the past, incorporated cities have grown at a faster pace than the rural areas. Recently, residential development has increased in agricultural areas away from cities and communities. This has created conflicts with agriculture, in spite of the County s Right to Farm ordinance. Also, treated water is generally not available in these areas and the U.S. Environmental Protection Agency has, by Administrative Order of December 22, 1992, prohibited Imperial Irrigation District from providing service to these residences from untreated canal water. Attempts to resolve this situation, including installation of in-home treatment systems, are on going. 20 Two methods of determining projected population are considered in this assessment. The first is based on information from the Imperial County General Plan. The second is based on US Census Bureau Data. The most conservative of these the one with the highest population is used for this analysis. Table 4 provides information that was specified in the Imperial County General Plan Land Use Element regarding County population levels in 1992 and These General Plan population levels were used to calculate an estimated population for the 30-year projection years of 2015, 2020, 2025, 2030, 2035, 2040, and These years are used based on anticipated construction beginning on the project in 2012 and the HR2 Project becoming operational in 2014, followed by the SmCP2 Project in The method used to calculate projected population in the unincorporated, incorporated, and combined County areas in each of the projection years is as follows: (2003 population) (1992 population) = (population difference) (population difference) (year 2003 year 1992) = (population change per year) (population change per year) x (number of years to projection year) = (total population change) (2003 population) + (total population change) = (projection year population) TABLE 4 Imperial County Population Projections 21 Area of Interest Unincorporated Areas 28,826 33,750 39,126 41,366 43,606 45,846 48,086 50,326 52,566 Incorporated Areas 88, , , , , , , , ,182 Entire County 117, , , , , , , , ,748 Source: 1992 and 2003 information is from the Imperial County General Plan 2003 Update, Land Use Element, page Imperial County General Plan 2003 Update, Land Use Element, pages 26 & Information for 1992 and 2003 is from the Imperial County General Plan 2003 Update, Land Use Element, page 26. Pangaea Land Consultants, Inc. 53

58 The concern of this method of estimating population change is that it assumes a consistent increase in actual population (same number of additional people) each year, versus an annual projection utilizing a consistent rate of increase (same percentage change) in the population each year. Table 5 provides information from the US Census Bureau. The population in Imperial County in 2000 according to the Bureau was 142,361 and the 2010 population count was 174,528. The percent population change over that ten year time period was 13.7%. This equates to an annualized rate of increase of 2.06% per year. TABLE 5 Imperial County Population Projections Area of Interest Entire County 142, , , , , , , , ,295 Source: The latter alternative in Table 5 provides a greater projected population and, therefore, a more conservative look at population growth. These numbers will be used in the calculations for water consumption later in this section. The Imperial County population is closely tied with job and employment availability, which typically results in sharp population increases during winter months. This is because agriculture is the dominant industry in Imperial County, which follows a seasonal pattern of high employment during winter months followed by lower employment during hot summer months, exactly opposite from the seasonal pattern elsewhere in California. As a leading producer of row crops and livestock, Imperial County is experiencing a trend toward reliance on labor contractors to provide workers during the high seasonal demand. As a result, population will increase more predominantly in winter months than summer months. Climate Imperial Valley has an arid desert climate characterized by hot/dry summers and mild winters. Summer temperatures typically exceed 100 degrees Fahrenheit, while winter low temperatures rarely drop below 32 degrees Fahrenheit. The remainder of the year has a relatively mild climate with temperatures averaging in the mid-70s. The average annual air temperature is 72 degrees Fahrenheit, and the average frost-free season is in excess of 300 days per year. The average annual rainfall in the Imperial Valley is less than three inches, with most rainfall associated with brief, but intense storms. The majority of the rainfall occurs from November through March, although periodic summer thunderstorms are common in the region. Imperial Valley does receive beneficial rainfall that is used for evapotranspiration; the remainder results in direct runoff to the Salton Sea. In general, an inch of rainfall over the IID service area can result in up to 40,000 to 60,000 acre-feet of reduction in IID s consumptive use of Colorado River water (depending on rainfall distribution, intensity, and duration). Table 6 illustrates rainfall values for , and that is followed the Figure 9 chart that shows the relationship between rainfall and agricultural water deliveries from Pangaea Land Consultants, Inc. 54

59 TABLE 6 22 IID Rainfall History (inches) Year Rainfall year average = 2.85 inches Source: IID Rainfall Record at Imperial Item 2: Consider the supplies to IID, as limited by the QSA, as equating to the demand within the service area Regional Demand for the Water Wholesaler Demand for water in IID s Imperial Valley service area is divided into three basic categories: agricultural, municipal, and industrial. In 2007, the IID delivered 2,646,072 acre-feet of water to the Imperial Valley. 2,593,541 acre-feet or percent of IID s flows in 2007 were to agricultural users. 23 The seven incorporated and three unincorporated urban areas within the Imperial Valley each receive water that is diverted from IID s lateral canal system to their treatment facilities prior to distribution within their respective municipal areas. The primary industrial water users outside the urban areas are geothermal plants, Holly Sugar Corporation, chemical and fertilizer producers, a state prison, and a U.S. Naval Air Facility. Figure 9: Water Delivered to Agricultural Users v. Rainfall East Brawley Geothermal Development Project SB 610 Water Supply Assessment Review letter, February 12, 2009, p East Brawley Geothermal Development Project SB 610 Water Supply Assessment Review letter, February 12, 2009, p Total and agricultural delivery quantities for 2007 were the most recent water distribution sums available from the IID, and were taken from the Imperial Irrigation District 2007 Annual Report, pg. 20. Pangaea Land Consultants, Inc. 55

60 IID s delivered water values are operational summaries of uses that may include agricultural, small acreage, municipal, industrial, and some losses. Additional water not accounted for in these numbers may include unmeasured deliveries such as service pipes, temporary construction, and miscellaneous uses as well as operational and system losses. There is no available data that completely distinguishes between these uses of raw water. Water distribution systems lose water during distribution for several reasons. Specific water distribution losses depend on the type of distribution system. A piped water distribution system can lose water due to pipe failures or leaks. Open channels, ponds, reservoirs, and water basins can lose water from seepage through the soil, surface evaporation into the air, and plant consumption. IID has an open channel gravity flow water distribution system comprised of over 1,600 miles of laterals and main canals. Its water distribution system losses result from four major conditions: seepage, operational discharges, evaporation, and phreatophyte consumption. The Consolidated Decree of the U.S. Supreme Court in Arizona v. California requires the Secretary of the Interior to provide detailed and accurate records of diversions, return flows, and consumptive use of water diverted from the mainstream of the Colorado River below Lee Ferry (lower Colorado River). The Bureau of Reclamation provides these records annually in a report, "Compilation of Records in Accordance with Article V of the Decree of the Supreme Court of the United States in Arizona v. California Dated March 9, 1964". Starting in 2004, with the implementation of the QSA, the report name is Colorado River Accounting and Water Use Report Arizona, California and Nevada. 25 These reports tabulate measured diversions, measured returns and consumptive uses of each Colorado River water contractor (Note: All IID accounting volumes are described as consumptive use values at Imperial Dam net of return flow). Regional Demand Based on Projected Population Table 7 shows the projected populations that have been calculated using the annualized change in population in the US Census data between 2000 and Municipal water demand is based on the amount of municipal water used in 2006 (37,958 acre-feet, 2009 SDI Apportionment Report, IID), plus the current District-wide average use per capita multiplied by the increase in population since Average use was calculated as 0.26 AF per capita per year, or just over 232 gpd/capita. This average per capita water use is multiplied by the current service population to determine the total apportionment to the water agency. The water demand in Table 7 addresses municipal consumption; primarily residential, commercial, schools, etc. As a comparison of projected consumption, IID s Draft Limit on Use, Cumulative Future Water Demand write up (included as Appendix, Item G) presents three scenarios for projected demand; Scenario 1 (Low Future Water Demand), Scenario 2 (Medium Future Water Demand), and Scenario 3 (High Future Water Demand). The water demand differential between Scenarios 1 and 2 is a function of anticipated geothermal development and higher population projections. Scenario 2: relatively medium future water demand based on development of 25 see 2004 PDF. Pangaea Land Consultants, Inc. 56

61 half of the known geothermal resources and municipal growth based on the forecasts in the 2005 Urban Water Management Plans - nearly 200,000 by 2040 (Fig 5). Values are based on IID from Supply Demand Imbalance Apportionment for cities that did not develop a UWMP. These municipalities are Holtville, Westmorland, Heber PUD, Seeley CWD, Centinela State Prison; and Niland and Calipatria, which are served by Golden State Water Company. 26 Projected municipal demand for the purpose of this WSA was first looked at based on extrapolated census data (Table 7, fourth column), as described in the Current and Projected Population section of this report, and summarized after Table 5. These values of projected demand, when compared to IID s three scenarios, are closest to the projections of Scenario 2. Though the municipal consumption projections of Scenario 2 are close to those based on Census Data population projections in Table 5, the Scenario 2 projections are higher for years 2015, 2020, 2025, and 2030; the same as the Census Data projections for 2035, and less than the Census Data projections for 2040 and Therefore, the highest values for each projection year are used for the purposes of this WSA and are the ones carried forward to Table 8. Note: The projected municipal use in Scenarios 1, 2, and 3 are shown through Year 2040, while Table 7 shows through Year This is because Year 2045 is the horizon year that this WSA has selected to address. The rate of change between 2035 and 2040 was used to extrapolate a value for TABLE 7 Water Use Within the IID Water Service Area Based on Projected Population (Municipal Use) Year Projected Population Gallons per Year Acre-Feet (from Table 5 Census Data) Acre-Feet From Cumulative Water Demand Scenarios, Scenario ,260 16,365,256,800 50,227 55, ,003 18,121,774,040 55,617 61, ,973 20,066,873,640 61,587 67, ,408 22,220,709,440 68,197 71, ,572 24,605,636,960 75,517 75, ,760 27,246,636,800 83,623 79, ,295 30,171,060,600 92,598 84,717 Note: One Acre-Foot = 43,560 cubic feet of water. One cubic foot = 7.48 gallon. One Acre-Foot = 325,829 gallons 26 IID Limit on Use, Cumulative Future Water Demand, IID, undated, p. 3 of 7 Pangaea Land Consultants, Inc. 57

62 Table 8 projects Total Water Demand by adding other non-residential land uses, such as geothermal, industrial, feedlot/dairies, and environmental resources (2045 values extrapolated). TABLE 8 Future Water Demand Medium Future Water Demand, Scenario 2, Year UWMP (Municipal) Geothermal Industrial Feedlot/ Dairies Environmental Resources Total Water Demand ,877 31,360 7,092 20,000 7, , ,397 38,903 7,092 20,000 12, , ,335 46,446 7,092 20,000 12, , ,233 53,989 7,092 20,000 12, , ,517 61,532 7,092 20,000 12, , ,623 69,075 7,092 20,000 12, , ,598 77,543 7,092 20,000 12, ,253 These other non-residential land uses have been aggregated together as Other Non- Agricultural Use for the projected Imperial Valley water consumption for each of the water use projection years in Table 9b. After deducting the IID Reduction from IID s Priority 3(a) Quantified Amount of 3,100,000 AF to achieve a Net Consumptive Use, Total Municipal Use and Other Non-Agricultural Use, the Total Agricultural Use is remaining amount, since agriculture will use what is available. Table 9b summarizes the projected water consumption for Imperial Valley from 2010 to For comparison, the most recent information available on agricultural consumption, from 2007, is 2,593,541 acre-feet. TABLE 9a Projected Imperial Valley Water Consumption, (Acre-feet at Imperial Dam) Year IID Priority 3(a) Quantified Amount IID Reduction: Total Amount IID Net Consumptive Use Amount (Total Imperial Valley)* ,100, ,200 2,738, ,100, ,200 2,569, ,100, ,200 2,649, ,100, ,200 2,617, ,100, ,200 2,612, ,100, ,200 2,612, ,100, ,200 2,612, ,100, ,200 2,612, IID Limit on Use, Cumulative Future Water Demand, IID, undated, p. 5 of 7, Scenario 2 Pangaea Land Consultants, Inc. 58

63 TABLE 9b Projected Imperial Valley Water Consumption, (Acre-feet in Imperial Valley) Year IID Net Consumptive Use (Total Imperial Valley) at Imperial Dam* IID System Loss (Est.)** Total Delivery Inflows to IID Service Area (Total Imperial Valley) Total Municipal Use Total Other Non- Agricultural Use Total Agricultural Use ,738, ,000 2,363,800 50,819 54,749 2,258, ,569, ,500 2,236,300 55,877 66,382 2,114, ,649, ,500 2,316,300 61,397 78,015 2,176, ,617, ,500 2,284,300 67,335 85,558 2,131, ,612, ,500 2,279,300 71,233 93,101 2,114, ,612, ,500 2,279,300 75, ,644 2,103, ,612, ,500 2,279,300 83, ,187 2,087, ,612, ,500 2,279,300 92, ,655 2,070,047 *IID Net Consumptive Use is from CRWDA/FEDERAL QSA, p 13, Exhibit B - Quantification and Transfers CRWDA/FEDERAL QSA, p 13, Exhibit B - Quantification and Transfers as cited in the Imperial Irrigation District 2007 Water Conservation Plan, pg. 20. It is assumed that as more growth occurs in the Imperial Valley, acreage in agriculture will decrease; therefore, agricultural water consumption will decrease as well. In addition, the IID Board of Directors, through the Integrated Regional Water Management Plan, is currently investigating other sources (supplemental supply) or reuse options for non-agricultural uses. If these are realized, there may be less impact on agriculture than indicated in Tables 9A and 9B. ** System losses estimate is extrapolated from November 18, 2008 Board Presentation: Changes to December 18, 2007 Equitable Distribution Regulation, pg. 3 of 5; the value reflects cumulative hidden services such as pipe accounts, as well as system losses (seepage, main & lateral canal spill, evaporation, phreatophyte use, etc.). IID System Loss numbers are adjusted for 2015 and beyond to account for reduction in seepage due to lining of All-American Canal. Quantification Settlement Agreement (QSA) Background 28 Notwithstanding the consensual Colorado River allocation made in the 1930's; as the population continued to increase throughout the West, water resources became scarcer, particularly for urban Southern California. The Metropolitan Water District of Southern California's (MWD) Colorado River Aqueduct can move almost 1.3 million AFY of water, yet as one can see from the priorities agreed upon in the Seven-Party Agreement, in "normal flow" years when California is limited to 4.4 million AFY, MWD can only fill about half its aqueduct. MWD's Priority 5 water rights to 650,000 AFY are outside the 4.4 million AFY limit. For most of the 20th Century, MWD filled its aqueduct with water that was unused by Nevada and Arizona. However, as these Colorado River Lower Basin States grew into full use of their 28 East Brawley Geothermal Development Project SB 610 Water Supply Assessment Review letter, February 12, 2009, p. 11. Pangaea Land Consultants, Inc. 59

64 apportionments, this extra water stopped being available for California. Many in urban Southern California began to look to IID, and its large water right, as a potential "solution" to this problem. In compliance with California State Water Resources Control Board (SWRCB) directives in Decision 1600 and Water Rights Order 88-20, IID entered into a long-term conserved water transfer with MWD in which MWD paid for conservation measures and reaped the benefit of the conserved water. This program, agreed to in 1988 and fully operational by 1998, now provides MWD with an additional 105,000 AFY to supplement its Priority 4 water right. However, that transfer still left MWD and urban Southern California with a need for additional reliable supplies. The San Diego County Water Authority (SDCWA), MWD's largest customer, entered into discussions with IID about a water transfer. In 1998, SDCWA and IID announced a proposed 200, ,000 AFY conserved water transfer wherein SDCWA would pay IID to conserve water and SDCWA would receive the benefits of the saved water. In 1998, SDCWA and IID jointly petitioned the SWRCB for approval of their proposed conserved water transfer. After almost four years of review and two weeks of evidentiary hearings over the course of 2002, late in 2002 the SWRCB issued a conditional approval, SWRCB Order The approval was conditioned upon environmental mitigation under federal and state environmental laws. Despite the transfer agreement with SDCWA, IID was still facing increasing pressure from other urban Southern California interests, most notably MWD and CVWD, to help resolve their water supply concerns. Additionally, IID, CVWD, and MWD had numerous disputes about their respective water rights, and it appeared such disputes would be heading to litigation. To avoid such litigation, in 2002 all major Southern California water agencies, along with the United States and the State of California, negotiated to try and reach settlement termed the Quantification Settlement Agreement (QSA) by the end of However, as the end of 2002 approached, a settlement acceptable to all parties was not found. On December 27, 2002, the Department of Interior issued a letter to IID warning that if IID agreed to the QSA by the end of 2002, IID's water order of 3.1 million AFY would be honored; however, if IID did not agree, then Interior would cut IID's 2003 water supply by about 270,000 acre-feet. IID filed a federal lawsuit against the United States and various officers thereof in January 2003, and obtained a preliminary injunction against the reduction in IID's 2003 water supply. The Court, however, granted the United States leave to conduct further review of IID's water use. Pursuant to that review, on August 29, 2003, the USBR Regional Director issued a Final Determination and Recommendations (Part 417 Determination), which remained subject to appeal to the Secretary of the Interior and then judicial review. In that Part 417 Determination, the USBR Regional Director determined that IID's million acre-feet water order should be denied and IID should be allowed to divert only 2,835,500 acre-feet. The IID, the United States, the State of California, the other California water agencies, and other Basin States were on the brink of years of complex litigation over the Part 417 Determination and other disputed issues. All agencies believed that a consensual resolution was preferable to the risks of litigation. After thousands of hours of further negotiations, which involved Congressional leaders, state legislators, senior executives of both the United States and California, as well as many water agencies and environmental groups, consensus was finally reached. The QSA and related agreements were agreed to by all. On October 2, 2003, IID's Board of Directors authorized the signing of the QSA and related agreements after appropriate review and approval of environmental assessments and notice to the public. Pangaea Land Consultants, Inc. 60

65 QSA Impacts on IID Water Supply The QSA and related agreements consist of a number of contracts signed at the same time (October 10, 2003). A list of the QSA and related agreements is included in the Appendix as Item F. The contracts are interrelated and interdependent. They form the basis for overall quantification, settlement and transfers agreed to by the many parties to the QSA and related agreements. The general impact of the QSA and related agreements as to IID can be described as follows: IID has agreed to years of large-scale water conservation in which millions of acre-feet of conserved water will be transferred to urban Southern California and a cap on IID's Priority 3 and a Priority 6 reprioritization with specific volumes. Along with such conservation and cap, large-scale environmental mitigation will be implemented throughout the affected region, including at the Salton Sea. The key water supply impacts for IID arising under the QSA and related agreements arise from the IID agreement to a Priority 3 cap of 3.1 million AFY and a schedule for creating conserved water for transfer and environmental mitigation that is deducted from the 3.1 million AFY cap. A table identifying the amount and method of creating conserved water (fallowing or efficiency methods) and the purpose of the conserved water (transfer or environmental mitigation) is included as Table 10. A graphic illustration of how the QSA and related agreements affect IID's Colorado River diversions for IID consumptive use is included as Figure 10. After year 2029 when all conserved water is created by improvement in water use efficiency, IID's reduced diversions allow IID to satisfy the same volume of water demand. Pangaea Land Consultants, Inc. 61

66 Table 10 Compromise IID QSA Delivery Schedule (KAF) 29 Delivery Agreement Year Conservation Practice Total Delivery Efficiency Fallowing Fallowing IID to IID to IID to (Col 2+3+4) for for for SDCWA CVWD MWD or (Col 6+7) Delivery Delivery Mitigation Calendar Year Total Fallowing (Col 7+8) QSA by and among IID, MWD, and CVWD, Exhibit C, (p 39 of 44) Pangaea Land Consultants, Inc. 62

67 Allocation of IID's Quantified Water Right 3,200 3,100 3,000 (1,000 AF) 2,900 2,800 2,700 2,600 2,500 2, Consumptive Use with QSA IID/MWD Agreement CVWD Transfer Salton Sea Mitigation for QSA Transfers Miscellaneous PPR SDCWA Transfer AAC Lining Project Figure 10: Projected Allocation of IID s 3,100,000 acre-feet per year from 2010 through 2047 ITEM 3: Projected Demand of the Projects Hudson Ranch 2 is a 49.9 MW triple-flash crystallizer reactor clarifier geothermal power plant. The requested delivery term of the water supply is 30 years after the construction start date, which is currently expected to occur in Operations are anticipated to begin in The projected life of the Project is a nominal 30 years. At the end of the useful life of the HR2 Project, equipment and facilities will be properly abandoned. Simbol is proposing to construct and operate SmCP2, a commercial lithium carbonate production plant that processes geothermal brine from HR2. SmCP2 will share the HR2 power plant site. The requested delivery term of the water supply is 30 years after the construction start date, which is currently expected to occur in Operations are anticipated to begin in The projected life of the SmCP2 plant is a nominal 30 years. At the end of the useful life of the plant, equipment and facilities will be properly abandoned. Irrigation Water Demand HR2 Construction water for the HR2 project will be obtained from IID s O lateral and typically averages 50,000 gallons per day for well drilling, while less water is needed for road grading, Pangaea Land Consultants, Inc. 63

68 plant construction and dust control. Water will be delivered to the construction and drilling sites by a 4,000 gallon water truck and temporary water pipelines. The net water usage for the HR2 cooling tower makeup and brine dilution water during power plant operation is estimated to be about 1,200 AFY. With the completion of the SmCP2 facility, an additional 800 AFY will be required for a total water usage of 2,000 AFY. Total water consumption of HR2 is 3,940 AFY, with a more detailed breakdown as follows: Cooling water requirement of about 3,184 AFY Brine dilution water of about 724 AFY Fresh water pond evaporation of about 20 AFY Miscellaneous uses of about 12 AFY The project will produce approximately 2,740 AFY of very low salinity geothermal steam condensate, which will be used to supply approximately 83 percent of the cooling tower makeup water demand for the project. Deducting the condensate volume (2,740 acre-feet) from the total water consumption (3,940 acre-feet) results in the net requirement of 1,200 acre-feet of water required from IID. It is this incorporation of the geothermal steam condensate for use as cooling tower make-up water that sets this Project apart in its efficient use of water. Table 11a provides the Projected Hudson Ranch 2 Project Annual Irrigation Water Usage. This information is broken down quarterly to illustrate the seasonal variations in consumption. TABLE 11a Projected Hudson Ranch 2 Project Irrigation Water Usage (Acre-feet) Use Jan-Mar Apr-Jun Jul-Sep Oct-Dec Total (Annual) Dilution Water Cooling Tower Make-up Process Water Pond Evaporation Miscellaneous Uses Total HR2 and SmCP2 With the completion of the SmCP2 facility, an additional 800 AFY will be required for a total water usage between the HR2 and SmCP2 plants of 2,000 AFY. A relatively small amount of water will be needed during site construction for fugitive dust control during site grading and construction activities. This water will be purchased from the IID and transported to the site via temporary pipeline or water truck. The projected additional water consumption for SmCP2 of approximately 800 AFY will be canal water purchased from the IID for projected cooling water makeup and for additional process water. Approximately 3 AFY of potable water will be delivered to the site for potable washbasin water, eyewash equipment water, water for showers and toilets in crew change quarters, and sink water in the sample laboratory. Alternatively, a reverse osmosis (RO) potable water system may be used to treat canal water for the potable water needs at the site. Pangaea Land Consultants, Inc. 64

69 Process water will be used for reagent preparation, product washing, and as cooling tower make-up water. Process water will be generated from atmospheric steam condensate at the neighboring HR2 site. Additional process water for cooling tower make-up will be purchased from the IID and taken from the O Lateral canal. Water will be delivered to the shared freshwater pond via an above ground pipeline from the canal. The freshwater pond will be sized to meet the maximum combined water needs of both HR2 and SmCP2. Canal water will also serve as the source of water for maintenance purposes and to charge the cooling tower prior to startup. Table 11b provides the projected Simbol Calipatria Plant 2 Annual Irrigation Water Usage. Though this facility will not operate independently, the seasonal breakdown is provided to clearly show the consumption attributed to the SmCP2 plant. TABLE 11b Projected Simbol Calipatria Plant 2 Irrigation Water Usage (Acre-feet) Use Jan-Mar Apr-Jun Jul-Sep Oct-Dec Total (Annual) Dilution Water Cooling Tower Make-up Process Water Pond Evaporation Miscellaneous Uses Total Table 11c provides the projected combined Hudson Ranch 2 and Simbol Calipatria Plant 2 Annual Irrigation Water Usage. This information is broken down quarterly to illustrate the seasonal variations in consumption. TABLE 11c Projected Hudson Ranch 2 and Simbol Calipatria Plant 2 Combined Irrigation Water Usage (Acre-feet) Use Jan-Mar Apr-Jun Jul-Sep Oct-Dec Total (Annual) Dilution Water Cooling Tower Make-up Process Water Pond Evaporation Miscellaneous Uses Total The primary source of external freshwater for the facility is anticipated to be irrigation water made available under a supply contract with the IID. Water will be obtained from the O lateral at proposed gate 28, located north of the power plant site. Water will be transferred to an HDPE-lined water storage pond on the power plant site via a freshwater pipeline (see Figure 3). Pangaea Land Consultants, Inc. 65

70 The water will be used for dilution of geothermal brine, solids dewatering system, steam wash water, purged water for pump seals and the reverse osmosis (RO) potable water system and, at times, cooling water makeup. The Projects are designed to minimize reliance on external sources of water supply for process needs as well by using condensed steam from the geothermal steam condensate to the greatest extent practical. Canal water will also serve as the source of water for maintenance purposes and water for the fire protection system. It will be used to charge the cooling tower prior to startup. The RO potable water system will be used to treat canal water and provide a supply of drinking water, washbasin water, eyewash equipment water, water for showers and toilets in crew change quarters, and sink water in the sample laboratory. Fire Protection and Safety Systems The fire protection system of the Projects will consist of an underground fire main and surface distribution equipment such as yard hydrants and hose houses, monitors around the perimeter of the cooling tower, automatic sprinklers for the turbine generator and auxiliary equipment, and a complete detection and alarm system. The fire protection water supply and pumping system will provide an adequate quantity of fire-fighting water. The systems will be designed in accordance with federal, state, and local fire codes, occupational health and safety regulations; and other jurisdictional codes, requirements and standard practices. Spent Fluid, Operations Waste Handling, and Wastewater Spent brine from the secondary clarifiers will be injected directly into the injection wells to replenish the geothermal resource. Under overflow conditions, brine will be directed to the brine pond, after which it will be processed through the thickener and delivered to the main injection system or injected into the dedicated aerated brine injection well. This dedicated injection well may also receive liquid from the thickener, which collects filter press filtrate, and liquid from the bermed areas around the plant equipment. The brine pond also receives liquid from the emergency relief tanks. Under normal operation, these fluids will be processed through the thickener and pumped into the main injection system. The reject water from the RO system will be pumped into the aerated brine injection well. Spent geothermal brine will be injected into the subsurface geothermal reservoir via the primary injection wells. The spent fluids from the brine pond will also be injected into the subsurface geothermal reservoir via either the dedicated aerated brine injection well, or processed through the thickener and then delivered to the main injection system. All subsurface fluid injection will conform to California Division of Oil, Gas and Geothermal Resources requirements. To keep the dissolved solids concentration of the circulating water in the cooling towers at acceptable levels, a stream of circulating water blowdown will be injected from the cooling towers into the dedicated aerated brine injection well. Drains for operations waste will discharge to an appropriate and approved collection system. Rain and storm drainage will be collected in the drainage water detention pond on the south side of the facility location. The drainage pond will be designed for a 24-hour, 100-year storm event. Water accumulated in the storm water detention pond will be allowed to evaporate, seep into the ground, or be pumped into the aerated brine injection well. Wastewater generated by personnel will be handled through the use of portable chemical sanitary facilities during the construction phase and will be maintained by a local contractor. After plant construction these will be permanent facilities, also serviced by a local contractor. Pangaea Land Consultants, Inc. 66

71 FIGURE 11 Proposed Transmission Line Connection Pangaea Land Consultants, Inc. 67

72 Section 5, Step Four: Documenting dry year(s) supply Consider the supplies available during normal, single dry, and multiple dry water years during a 30-year projection Item 4: Introduction SB 610 requires an analysis of a normal, single dry, and multiple dry water years to show that adequate water is available for statistical conditions. Because IID s 2000 Regional Urban Water Management Plan was deemed obsolete and is no longer supported by IID (see Appendix, Items B and C) due to the consumptive limits imposed by the QSA, the water supplies available during a normal year are best represented by the post-qsa era (2003 and later). This represents the maximum amount of supply available and is thus the new normal water year. This is the age of limits for IID, where water is not necessarily tightly constrained or scarce, but rather the supply is no longer unlimited due to the agreements with other QSA participants. For the single dry and multiple dry water years assessment, the Equitable Distribution Plan (EDP) governs. The EDP was adopted in 2007, along with subsequent regulations, allowing the IID Board to make an annual determination as to Supply/Demand Imbalance (SDI) conditions. In an October 26, 2008 Board presentation, IID staff summarized the situation by noting that a 64% probability existed of demand exceeding supply in the 2009 calendar year, even assuming no overrun were to occur in Similarly, the Hanemann Brookes Study opined that SDI situations were likely to occur 4 or 5 times out of the next 10 years, and from 2003 through 2008 IID was accounted as overrunning its annual water limit three times. The Equitable Distribution Plan and the Supply/Demand Imbalance are discussed in Item 4 under the single dry and multiple dry years projections. Consumptive use is not the same as delivery. Table 12 (Exhibit B of the CRWDA), particularly column 13, summarizes the IID Net Consumptive Use Amount, which is indicative of future supplies as measured at Imperial Dam. Agricultural water demands will decrease in an amount equivalent to the water conservation attributable to on-farm efficiency measures (setting aside outside factors such as annual rainfall, differences attributable to the intensity of farming within IID such as acreage in production, double cropping, and market conditions, etc.), so while IID s total volume in this column is declining, so too are its agricultural demands. However, as a consequence of reducing the agricultural water demand through increased on-farm and system efficiency, less water is available for years when agricultural demand may be higher than normal, such as in years of low rainfall or due to cropping choices made by Imperial Valley growers. Such intermittent spikes in higher agricultural demand means less water is available for non-agricultural development. Similarly, reductions attributable to system conservation efforts and the All-American Canal Lining Project are a result of the implementation of conservation measures, so there is no net decline in the water available for IID s water users as a result of water conservation and transfer projects (even though these tables illustrate declining future consumptive use limits for IID). IID suggests the following table, which assumes full use of IID s water supply, be considered given the projected probabilities of SDI conditions, ongoing Colorado River drought hydrology, water use, and the declaration of 2009 as a SDI Water Year: Pangaea Land Consultants, Inc. 68

73 CRWDA:Federal QSA Exhibit B: IID Quantification and Transfers, as of 2008 (KAF at Imperial Dam) 1 Col IID Priority 3a IID Priority 3a Quantified Amount 1988 MWD Transfer 2 Table 12 IID Net Consumptive Use Notes: 1. Information conveyed in this figure is from the United State Bureau of Reclamation's Exhibit B of the Colorado River Water Delivery Agreement (CRWDA); however, IID has adjusted the 1988 MWD Transfer values for 2003 through 2006 to reflect actual values and the values for to reflect the new IID/MWD agreement. IID Total Reduction and IID Net Consumptive Use Amount have been recalculated to reflect these changes. 2. By IID and MWD agreement, the 1988 IID/MWD transfer has been fixed at 105 KAFY, starting in Reductions include conservation for 1988 IID/MWD Agreement Transfer, IID/SDCWA Transfer, AAC Lining (amount may vary); SDCWA Transfer Mitigation, additional MWD Transfer w/salton Sea Restoration (amount may vary), and Misc. PPRs and allow for Conditional Interim Surplus Agreement Backfill (amount may vary). Amounts in this table are independent of increases and reductions as allowed under the Inadvertent Overrun and Payback Policy. NOTE: Shaded columns represent amounts that might vary. 4. Assumes SDCWA does not elect termination in year Assumes SDCWA and IID mutually consent to renewal term of 30 years. Source: QSA CRWDA Exhibit B Salton Sea Mitigation SDCWA Transfer IID Reductions Intra- Priority 3 CVWD Transfer MWD Transfer w\salton Sea Restoration Conditional ISG Backfill IID Total Reduction (Σ Cols 3-10) 3 IID Net Consumptive Use Amount SDCWA AAC Misc. (Col 2 - Col Year Transfer Lining PPRs 11) , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , Pangaea Land Consultants, Inc. 69

74 Item 4: Consider the supplies available during normal water years during a 30-year projection The official USBR Colorado River Accounting and Water Use (Decree Accounting) report tabulations that include QSA and related agreement deductions related primarily to IID s water conservation and transfer projects and modified for IID hidden services and system losses provide the most appropriate summary of IID s consumptive uses. IID s official consumptive use values from USBR Decree Accounting records are shown in Table 13. These values do not include the deductions related to any water conservation and transfer programs (IID/MWD began in 1990 and the QSA transfers initiated in 2003) nor IID hidden services and system losses. Prior to 2003, IID had a dynamic water right well in excess of its usage. As previously noted, given the 3.1 MAF cap agreed to by IID as a part of the QSA/Transfer Agreements, this WSA focuses on water years and accounting from 2003 forward. The IID Net Consumptive Use Amount in column 12 of the updated QSA CRDWA Exhibit B best characterizes the normal year supplies at Imperial Dam. For use Imperial Valley, this number must be reduced to account for IID system losses and hidden services. Pangaea Land Consultants, Inc. 70

75 Year IID Consumptive Use ,848, ,967, ,965, ,047, ,171, ,070, ,876, ,772, ,757, ,884, ,845, ,872, ,595, ,555, ,666, ,685, ,686, ,764, ,947, ,009,451 IID/MWD Conservation Program ,054,188 6, ,898,963 26, ,575,659 33, ,772,148 54, ,048,076 72, ,070,582 74, ,159,609 90, ,158,486 97, ,101, , ,088, , ,112, , ,089, , ,152, ,940 IID/SDCWA Conservation Program Salton Sea Mitigation IID Overrun Per Decree Accounting Records ,978, ,130 10, , ,743, ,900 20,000 15, ,756, ,940 30,000 15, ,909, ,160 40,000 20,000 18, ,872, ,000 50,000 25,021 6,358 IID/CVWD Conservation Program AAC Lining ,878, ,000 50,000 26,085-47, ,000 8, ,862, ,000 60,000 30, , ,000 65, USBR does not report the volume of unused entitlement for IID in Decree Accounting records. 2. Significant corrections were made to IID s 2000 Consumptive Use values in the 2001 Decree Accounting report. 3. The 2003 Salton Sea mitigation requirement of 5,000 acre-feet was rolled into USBR waived the 2003 payback obligations for all Colorado River contractors and 2009 were years with an underrun. Table 13 Annual Decree Accounting Pangaea Land Consultants, Inc. 71

76 Emergency Preparedness The following is a brief description of IID operations and its mutual aid program with regards to emergency planning, which was taken from the IID website: The Imperial Irrigation District (District) is a public owned utility district. The District is considered a special district in the eyes of the State of California and Federal Government. A special district has to meet the same requirements as a local city pertaining to emergency preparedness and emergency management. The District is required to go through the appropriate channels regarding mutual aid. In the event of a natural and or manmade disaster, the District would open its Emergency Operations Center (EOC) located at headquarters in Imperial, California. The District will then notify the Operational Area (OA), which is the Imperial County Office of Emergency Services located in Heber, California at the Imperial County Fire Department Station # 2. If the event called for mutual aid for the District, the District s EOC would request assistance from the OA. If the OA was unable to fulfill this request it would go to the next highest level, which would be the Regional Emergency Operations Center (REOC), located in Los Alamitos, California. In the event the REOC was unable to fill the request it would go to the State Operations Center (SOC) located in Sacramento, California. The SOC would fill the request or ask for federal assistance from the Federal Emergency Management Agency (FEMA) a sub - section of the Federal Department of Homeland Security (DHS). In the case of an emergency, IID is prepared to utilize its existing facilities to analyze whatever situation(s) maybe present, and administer the necessary procedure(s) to hopefully alleviate the problem. The following was also taken from the IID website: The District has a current EOC located at District Headquarters located in the Water Control Conference Room. The conference room can be converted into an active EOC within 30 minutes. The EOC has a back up generator in case of power failure, which is capable of running for 72 hours with out refueling. The EOC is equipped with phones, radios, computers, maps, etc. Pangaea Land Consultants, Inc. 72

77 Item 4: Consider the supplies available during single dry, and multiple dry water years during a 30-year projection The Equitable Distribution Plan was created to address years in which demand is projected to exceed supply. For purposes of this WSA, such years with a supply/demand imbalance (SDI) constitute dry years for IID. Management During Supply Demand Imbalance via Equitable Distribution Plan On November 28, 2006, the Board of Directors ( IID Board ) of the Imperial Irrigation District ( District ) adopted Resolution No approving the development and implementation of an Equitable Distribution Plan. As part of this Resolution, the IID Board directed the General Manager to prepare the rules and regulations necessary or appropriate to implement the Equitable Distribution Plan within the District. The EDP was created as a water management tool to address years in which water demand is expected to exceed supply; that is, when there is a supply/demand imbalance (SDI). The Hanemann Brookes study suggests that SDI conditions are likely to occur 40-50% of the years during the next decade. The dry and multiple dry water years analysis assumes the following: 1) Rainfall is scarce in Imperial County to create dry local conditions. The year of 2006 with 0.43 inches of rain well below the 94-year average of 2.85 inches creates higher than normal demand. This is deemed the dry water year. 2) The USBR has not declared a surplus for delivery to the Colorado River Lower Basin and an SDI has been declared by IID s Board of Directors for the year. This scenario creates the worst-case conditions of higher than normal demand and lower than normal supply. Dry Year Demand In the case of demand, IID notes that, in general, an inch of rainfall over the IID service area can result in up to 40,000 to 60,000 acre-feet of reduction in IID s consumptive use of Colorado River water. The year of 2003 had rainfall of 2.72 inches (see Table 6) the closest in recent years to the statistical average of 2.85 inches. For this reason, 2003 is deemed a normal year. IID s projected Net Consumptive Use (CRWDA Exhibit B) amount that year (2003) was 2,968.4 thousand acre-feet (see Table 12). Note: official USBR record shows IID Net Consumptive Use for 2003 as 2,978,223 AF, with an overrun of 6,102 AF. For the selected dry water year of 2006, with 0.43 inches of rainfall, IID projected Net Consumptive Use (CRWDA Exhibit B) was 2,918.4 thousand acre-feet (official USBR Net Consumptive Use is 2,909,680 AF, with an overrun of 17,914 AF), which incidentally was lower than for 2003 when the rainfall was near-normal, at 2.7 inches (official USBR NET Consumptive Use is 2,978,223 AF, with an overrun of 6,102 AF). Agronomic and/or agricultural economic conditions likely influenced individual farm management decisions and practices and, thus, impacted water use in Source: IID 2007 Water Conservation Plan, Table 25, p 27 Pangaea Land Consultants, Inc. 73

78 Assumption: For this WSA, it is assumed that during a dry year the water demand will be 50,000 acre-feet greater for every inch of rainfall less than the than the water demand in a normal year rainfall of 2.72 inches. That is, for every inch of rainfall less than the Imperial Valley 90-year average of 2.85 inches/year, the water demand will be increased by 50,000 AF in a dry year over the amount used in a normal year (see discussion under Climate, page 50, for the basis of this assumption). Given: Normal Year (2003) Net Consumptive Use (measured at Imperial Dam) = 2,978,223 AF Normal Year (2003) Rainfall = 2.72 inches Dry Year (2006) Rainfall = 0.43 inches Normal Consumptive Use + [(Average Year Rainfall Deficient Year Rainfall) x (50,000 acre-feet)] = 2,978,223 acre-feet + [(2.72 inches 0.43 inches) x (50,000 acre-feet)] = 2,978,223 acre-feet + 114,500 acre-feet = 3,092,723 acre-feet of dry year demand Dry Year Supply Equitable Distribution is the mechanism by which a Supply/Demand Imbalance is administered. From the Imperial Irrigation District Environmental Compliance Report for Revised Regulations for Equitable Distribution Plan, pg 1 (see Appendix, Item D), the specifics governing Equitable Distribution are as follows: Declaration/Termination of Supply/Demand Imbalance: a. District shall track actual supply and demand during each Water Year and, based upon District staff s estimates of water supply and demand for the coming Water Year, determine whether the probability of total demand exceeding District s Colorado water supply is greater than fifty percent (50%). If the probability is greater than fifty percent (50%), the District may declare an SDI for the coming Water Year. Such SDI Declaration must be made on or before October 1 and can be withdrawn on or before December 31. b. District shall track actual supply and demand during the SDI Water Year. If cumulative consumptive use through June of the SDI Water Year is less than MAF, District may terminate the SDI Declaration for that year. Apportionment of Supply: Upon SDI Declaration, District shall apportion the Available Water Supply among the types of water users in the District using the following: a. Municipal Users - Base amount of 2006 usage plus current District-wide average use per capita multiplied by the increase in population since 2006; b. Industrial Users - For existing contracts, estimated based on past use, not to exceed contracted amount and contract terms. For new contracts, estimated based on anticipated use, not to exceed contract amount and contract terms, Pangaea Land Consultants, Inc. 74

79 taking into consideration the Integrated Water Resources Management Plan and its Interim Water Supply Policy for Non-Agricultural Projects; c. Feed Lots and Dairies - Estimated based upon past use and consideration of future changes; d. Environmental Resources Water - Estimated based upon the amount reasonably necessary to achieve the purposes of the District s commitments, taking past use into account; and e. Agricultural Lands - Straight Line Apportionment used. Subtract the estimated demand for categories a through d above from Available Water Supply, and then divide the remaining supply by the total number of Eligible Agricultural Acres pursuant to a through c noted under the definition for Eligible Agricultural Acres to determine apportionment per Eligible Agricultural Acre. The amount apportioned to acreage that does not comply with d under the definition for Eligible Agricultural Acres will be placed in the District Water Exchange. Non-Agricultural Water Users: a. District shall notify Non-Agricultural Users of their apportionment no later than December 1, prior to the beginning of the SDI Water Year. b. Non-Agricultural Water Users shall be allowed to use that amount of water needed for reasonable and beneficial use. If a Non-Agricultural Water User exceeds the amount of apportionment quantified for its usage, the fee for the excess amount of water shall be the Water User s standard water rate plus the Conserved Water Rate. Agricultural Water Users: a. Agricultural Water Users must complete and keep current the Water Card to receive an apportionment and delivery of water. As part of this process, Farm Units must be identified and kept current. b. A written notice of the apportionment per Eligible Agricultural Acre of the number of Eligible Agricultural Acres per owner shall be sent to the land owner and the authorized representative no later then December 1 prior to the beginning of the SDI Water Year. c. The owner or authorized representative of Eligible Agricultural Acres must accept or reject in writing some or all of the SDI Apportionment on a take-or-pay basis within sixty (60) days of the notice of the SDI Apportionment. Payment for the accepted apportioned water shall be made monthly based on actual use. On December 31 of the SDI year, any remaining amount of unused water part of the take-or-pay obligation will be included in the year end invoice. District Water Exchange Eligibility: Any Agricultural Water User can be a Buyer. Any Agricultural Water User with an SDI Apportionment may be a Seller. Offers to Sell: a. An Agricultural Water User with acres eligible for SDI Apportionment may subsequently send a Notice of Intention to Sell to the District indicating the number of Acre Feet of water being offered to the District Water Exchange for immediate sale. b. Potential Seller must be current on his take-or-pay obligation. c. An Agricultural Water User that has sent a Notice of Intention to Sell to the District Pangaea Land Consultants, Inc. 75

80 may subsequently send a Notice of Withdrawal of Offer to Sell. The District will honor the Notice of Withdrawal only if the water that was the subject of the original Notice of Intention to Sell has not been sold prior to receipt of the Notice of Withdrawal of Offer to Sell. Offers to Buy: a. An Agricultural Water User may send a Notice of Intention to Buy to the District that states the number of acre/feet of water he wishes to acquire from the District Water Exchange. b. An Agricultural Water User that has previously sent a Notice of Intention to Buy may subsequently send the District a Notice of Withdrawal of Offer to Buy. The District will honor the Notice of Withdrawal of Offer to Buy if the District has not previously purchased water from sellers to satisfy the Notice of Intention to Buy. Priority of Execution of Sell/Buy Offers: Priority of offers to Sell and/or Buy will be based upon the date of receipt of the Notice of Intention to Sell or Buy. The District will periodically publish on its website the aggregate volume of water from pending Notices of Intention to Sell and/or Buy. Payment for Water from the Water Exchange: After the District sells the water that Seller has offered for sale though his Notice of Intention to Sell, the Seller shall have no further take-or-pay obligation for payment of that water. If Seller s water does not sell, he is responsible for his take-or-pay obligation. The buyer shall pay the District the total purchase amount due before receiving the purchased water. The total amount due is based on the Acre Feet of water purchased (not to exceed buyer s Notice of Intention to Buy) multiplied by the purchase price defined as the current District agricultural water rate plus a processing fee on one dollar ($1) per Acre Foot. Charge for Unused Water: If an Agricultural Water User buys additional water through District Water Exchange, then he must either: (a) use the purchased water during the SDI Water Year; or (b) offer the purchased water for sale through the District Water Exchange no later than October 1. If an Agricultural Water User does none of the above and has not used the total of purchased water plus accepted SDI Apportionment on his Eligible Agricultural Acres at the end of the SDI Water Year, such Agricultural Water User shall pay a charge to the District (in addition to his take-or-pay obligation) equal to the Unused Water Charge multiplied by the amount in Acre Feet by which the Agricultural Water User s unused purchased water from the District Water Exchange plus unused accepted SDI Apportionment for the SDI Water Year exceeds five percent (5%) of the amount apportioned to the Agricultural Water User s Eligible Agricultural Acres. Interface With District Agricultural Land Fallowing Program: An Agricultural Water User that participates in District s Fallowing Program must assign to the District an amount of the Agricultural Water User s accepted SDI Apportionment equal to the amount of water conserved by fallowing for which the Agricultural Water User is contracted. Pangaea Land Consultants, Inc. 76

81 If the Agricultural Water User s accepted apportionment is less than his Fallowing Program contracted amount, he may procure this difference from the following sources for which the Agricultural Water User qualifies pursuant to these regulations: the Agricultural Water User s accepted SDI Apportionment on other Eligible Agricultural Acres, or the District Water Exchange. Miscellaneous: The General Manager is authorized and directed to do any and all things necessary to implement and effectuate these Regulations. The General Manager shall provide notice of any changes or revisions to these Regulations to all District landowners and water users. Conclusions An SDI is declared when Imperial Valley demands are projected to exceed the available IID water supply for that calendar year. If IID use is not reduced sufficiently and demand exceeds the quantified amount in any calendar year, that overuse must be paid back in future years according to the terms of the Inadvertent Overrun Payback Policy (IOPP). TABLE 9b Projected Imperial Valley Water Consumption, (Acre-feet in Imperial Valley) Year IID Net Consumptive Use (Total Imperial Valley) at Imperial Dam* IID System Loss (Est.)** Total Delivery Inflows to IID Service Area (Total Imperial Valley) Total Municipal Use Total Other Non- Agricultural Use Total Agricultural Use ,738, ,000 2,363,800 50,819 54,749 2,258, ,569, ,500 2,236,300 55,877 66,382 2,114, ,649, ,500 2,316,300 61,397 78,015 2,176, ,617, ,500 2,284,300 67,335 85,558 2,131, ,612, ,500 2,279,300 71,233 93,101 2,114, ,612, ,500 2,279,300 75, ,644 2,103, ,612, ,500 2,279,300 83, ,187 2,087, ,612, ,500 2,279,300 92, ,655 2,070,047 For convenience, Table 9B is repeated at this point in the document (without notes) Again, this assessment will consider 2003 as the characteristic normal year with 2,978,223 acre-feet of consumptive use (Table 13). Given that in 2003 there were 450,556 acres irrigated for agriculture ( Annual Inventory of Areas Receiving Water, ), and deducting 50,819 acrefeet for municipal uses and 54,749 acre-feet for other non-agricultural uses (Year 2010, Table 9b), that leaves 2,872,655 acre-feet (less system losses of 375,000 leaves 2,258,232 acre-feet) to irrigate 450,556 acres, equating to a normal water year agricultural use of 5.0 AF/AC). The apportionment for the SDI declared in 2009 is 5.25 acre-feet/acre, this number assumes that the Total Municipal and Total Other Non- Agricultural Use will be less than projected in Table 9b. In the event that a reduction in use by the agriculture sector is required, such a reduction would be accommodated on the basis of individual farm management decisions and practices such as adjusting the Pangaea Land Consultants, Inc. 77

82 crops planted for the year to incorporate ones requiring less water use, or reducing the amount of water applied to crops that may result in a lower yield, or some other agronomic and/or agricultural economic accommodation. These same conditions could go on for multiple years, with low local rainfall resulting in higher agricultural demand and low watershed precipitation resulting in a reduced supply. As noted in the Hanemann Brookes study, this SDI condition could be anticipated to occur in four or five of the next ten years, creating the multiple dry water years condition to be included in the assessment. Section 5, Step Five: Documenting dry year(s) demand Projected IID water supplies during 30-year projection incorporating project build-out Item 5: Combine the projected supplies to IID available during normal, single dry, and multiple dry water years with completion assumptions for the Project to provide the 30- year projection of demand in the years 2015, 2020, 2025, 2030, 2035, 2040, and To determine the availability of supply for the proposed project, first look at the existing land use and water demand on the property. This will be compared with the proposed uses and water demand of the Projects as one measure of determining the adequacy of supply to meet the demand. Existing and Proposed Uses The existing uses on the property consist of agriculture to varying degrees and a commercial algae farm. Specific uses and water delivery sources consist of the following: Gate 29 serves only the algae farm. The flow from the head gate flows into a pipe, which flows directly into the algae farm. The construction and operation of the Projects will not affect the algae farm; its operations will continue. The 43 acres to the north of the algae farm is the site of one proposed production well pad (5 acres) and is also designated for service from Gate 29, but cannot be irrigated at the present time without re-configuring the pipe to the algae farm or the head gate. This site has not seen any agricultural use in many years if at all. Therefore, no future agriculture will be assumed for this site. The Hudson Ranch 2 power plant and Simbol Calipatria 2 materials processing plant will get their water from Gate 28. The power plant site (approximately 40 acres) and the second production well site (4.6 acres) will exclude agriculture from the land served by this gate for the duration of the project (at least 30 years). During the two-year construction process, another 20 acres will be excluded from agricultural operations for the equipment and material lay down area. The final design work has not been undertaken, but it is anticipated that a second gate will be constructed to allow the Projects to take their water from the O canal and be billed at the industrial rate, leaving the existing gate to provide irrigation water to the balance of the land that will remain in agriculture and be billed at the agricultural rate. Pangaea Land Consultants, Inc. 78

83 The two injection well pads of 5 acres each will exclude agricultural from 10 acres of land served by Gate 26 for the duration of the Project. The total foot print for the combined Projects is 110 acres. This is the HR2 power plant, three well pads, the SmCP2 processing plant, and roads. Of this 110 acres, one 5-acre well pad lies within the 43 acres north of the algae farm that is assumed to have no future agricultural use. This leaves a 105-acre footprint to be subtracted from lands with future agricultural potential. Until relatively recently, all the Project lands were owned by the IID. It is believed that years showing "0" water deliveries (Table 14) represent years in which IID did not lease out the land for farming. The current owner of the land served by gates began farming the land in The property has the ability, however, to be more fully developed in agriculture based on its location within the service area. With a total site area of 283 acres, less the combined Project footprint of 105 acres, less the 43 acres for the fallow farmland and one well pad, the remaining portion available for agriculture is 141 acres. In an SDI year, agriculture on this land would equate to 135 ac. x 5.25 acre-feet/acre = 709 acre-feet. Table 14 shows the IID water deliveries to the property. See Figure 12 for an Aerial Photograph showing agricultural use. TABLE 14 Past Agricultural Water Delivery Year Water Delivery (acre-feet) at Delivery Gate O O O O Total , ,174.6 Total 1, , ,021.7 O refers to the O canal Discounting the years of no agricultural use (2001, 2003, 2005, and 2006), and also discounting the year 2004 with only 1.4 acre-feet of delivery, the average water use in years when the property was in agriculture (five years) is 804 acre-feet per year. This is less than the 2,000 acre-feet per year requested of IID from the O canal to serve the Projects. This is also greater than the potential water use of the remainder agricultural land during an SDI year. Because the total acreage has not been in full agricultural production and the combined Pangaea Land Consultants, Inc. 79

84 Projects will occupy 110 acres of the total site of 283 acres, it is assumed that agricultural production will continue to the extent it has in the past. Therefore, the 804 acre-feet is a reasonable representation of agricultural use in a normal water year for the extent of agriculture on the site. This amount will be used for comparisons with and without the project in Table 15a and 15b. FIGURE 12 Aerial Photograph Pangaea Land Consultants, Inc. 80