Wholesale water agency created by State Legislature in 1944 24 member agencies 36-member board of directors 3 million people $188 billion economy Mission is to provide safe and reliable water supply to member agencies Service area 950,000 acres 97% county s population 1
1991 2012(Final) 26 TAF (5%) 80 TAF (13%) 552 TAF (95%) Total = 578 TAF 70 TAF (11%) 85 TAF (14%) 274 TAF (45%) 24 TAF (4%) 18 TAF (3%) 61 TAF (10%) 190 TAF (24%) 2020 80 TAF (10%) 103 TAF (13%) 44 TAF (6%) 56 TAF (7%) 231 TAF (30%) 27 TAF (4%) 48 TAF (6%) Total = 612 TAF Metropolitan Water District Total = 779 TAF Recycled Water Imperial Irrigation District Transfer All American & Coachella Canal Lining Seawater Desalination Groundwater Conservation (existing and additional) Local Surface Water TAF=Thousand Acre-Feet
New, local water supply Reduces need for imported water Drought-proof supply Improved water quality More expensive than existing imported supplies Cost on par with other new, local water supplies Enhances regional supply reliability and local control 3
Not Important 8% Unsure 10% Important 82% Not Important 6% Unsure 8% Important 86% Not Important 15% Unsure 3% Important 82% 2006 2009 2010 Importance of Seawater Desalination to Supply Reliability 4
Mouth of Lagoon Outfall
Carlsbad site first identified in 1991 Water Authority Study Poseidon 2001 Study Due Diligence by Water Authority Poseidon obtained long term lease 2 EIRs established environmental feasibility Water Authority City of Carlsbad/ Poseidon Included in 2005 and 2010 State mandated Urban Water Management Plans
6 year permitting and entitlement process by Poseidon 12 local discretionary approvals 7 state agency discretionary approvals 21 Public Hearings- 85 hours of testimony Dozens of technical studies 14 legal challenges Unanimous support of state & federal legislative delegations and hundreds of letters of support Reclaimed water pipelines
Project Components TOVWTP TOVWTP Improvements P3 relining 5-miles Pacific Ocean Carlsbad Desal WTP Encina Power Station New 54-inch steel pipe 10-miles San Marcos Pipeline Interconnection Pipeline 4 Pipeline 3 8 8
Developer/Owner Poseidon Resources Construction/Operation of the Plant WPA between Water Authority and Poseidon Contractor Kiewit/Shea Desalination IDE Technologies is process technology provider Plant operations and Maintenance also provided by IDE 9
WPA outlines commercial and financial terms for production and delivery of water Establishes risk transfer to private developer Outlines terms of potential purchase of plant by Water Authority Water Authority Board approved WPA on Nov 29, 2012 Board initially approved a term-sheet in 2010 as basis for negotiations Water Authority conducted comprehensive project and financial due diligence effort prior to approval of the WPA 10
Permit, Design and Build the Desal Plant Permit, Design and Build the Conveyance Pipeline (design-build agreement) Own, operate and maintain the Desal Plant Supply Product Water that meets water quality requirements 11
Timely Construction of TOVWTP Improvements and Pipeline 3 Rehabilitation Own, operate and maintain the Conveyance Pipeline, the TOVWTP Improvements and Pipeline 3 Take or Pay for Product Water if it meets specifications (minimum commitment of 48,000 AF/Year) 12
Total Capital Cost Total desalination plant Total conveyance pipeline Financing costs Water Authority improvements and oversight Total Capital Costs $537 million $159 million $227 million $80 million $1.003 billion Total O&M Costs (Plant and Pipeline) $49 - $54 million annually Total Unit Cost 1 56,000 acre feet per year 48,000 acre feet per year $2,014/AF $2,257/AF 1 Includes debt service, operations, Water Authority construction oversight and administrative costs 13
Carlsbad Desalination Project $2,014 $2,257 Mission Basin Narrows $1,717 Otay River $1,475 $2,086 City of SD RWS* $1,975 2,375** North San Diego County Regional Reuse $1,628 $1,730 Camp Pendleton Desalination (100 mgd) (50 mgd) $1,900 $2,340 0 500 1,000 1,500 2,000 2,500 3,000 $/AF Brackish Groundwater Recycled / IPR Seawater Desalination *Cost range includes wastewater related costs that may reduce the unit cost by up to $600/AF. ** Incentive funding reduced at 2011 value of $275. RWS assumes deduction for incentives on 20 year NPV basis.
82% funded through Bonds issued via the California Pollution Control Financing Authority Plant Bonds issued as Tax-Exempt Private Activity Bonds with Poseidon as sponsor Pipeline Bonds issued as Tax-Exempt Governmental Purpose Bonds with the Water Authority as sponsor Bonds sold on December 24, 2012 Interest rate 4.78% 18% Cash Equity from Stonepeak Infrastructure 15
Approximately 35 months to construct, start-up and commission plant Approximately 30 months to complete conveyance pipeline and Water Authority improvements On-line by 2016 16
Questions?