Cal Am pulls its desal bid

California American Water officials were worried they were headed toward losing a desalination project permit bid at the Coastal Commission when they decided to withdraw the permit application at the last minute before a scheduled special meeting on Thursday.

But a top company official said Cal Am is not giving up on the project, which calls for constructing a 6.4-million-gallon-per-day desal plant and infrastructure as the central element of the proposed Monterey Peninsula Water Supply Project aimed at offsetting the state water board’s Carmel River pumping cutback order.

Cal Am president Rick Svindland told The Herald on Thursday

that company officials decided they couldn’t risk losing based on the expressed levels of support and opposition for the desal project, and the prospect of an even lengthier delay.

“If we were to lose (Thursday), it would add 10 years to the project,” Svindland said. “There was not enough comfort (in the outcome at the commission) to take a chance.”

Instead, Svindland said company officials will try to reach an agreement with Marina city stakeholders and others who opposed the desal project addressing what he called the key issues — social and environmental justice — before re-submitting a desal project permit application, perhaps including a revised proposal, within a matter of months.

Svindland said the hope is to rely on the California Public Utilities Commission settlement process in an effort to resolve those issues among the key stakeholders and re-submit the application to the Coastal Commission within a few months. He said company officials have already called the CPUC, which approved the desal project in 2018, to ask for help in reaching out to all parties in the

desal project settlement agreement to participate in talks.

It’s anyone’s guess whether desal project opponents will be receptive to any Cal Am overtures given the number of organizations and individuals lined up against the desal project proposal.

Marina city officials and the Public Water Now activist organization have both issued statements celebrating the desal project permit withdrawal and calling for Cal Am to pursue the Pure Water Monterey expansion proposal instead of desal.

Cal Am notified Coastal Commission officials late Wednesday afternoon that they intended to withdraw the application after having given them a heads-up earlier in the day they might do so.

In a release, Svindland cited “many factors” in the decision to withdraw the application including social and environmental justice issues involving the city of Marina and its lower-income customers, which commission staff had made one of the central focuses of its recommendation for denial.

“We recognize the social and environmental justice concerns and want to spend more time with Marina stakeholders on those issues, as well as with our own customers on our proposed enhanced customer assistance program. Because the commission must meet deadlines associated with the (state) Permit Streamlining Act, withdrawing and refilling our

application is the best way to allow more time for these things to occur.”

Svindland added that company officials felt the decision to withdraw and refile is in the “best interests of our customers and increases the likelihood of receiving the permits necessary to construct the project.”

He added that company officials had already reached out to inform state water board officials about the move and argue that it “supports our intent to decrease pumping on the (Carmel River) as quickly as possible while ensuring our customers have an adequate water supply.”

Svindland noted that Cal Am officials had already notified the state water board that it would miss both the Sept. 30 milestone and the Dec. 31, 2021, deadline for the river cutback order, and argued that the delay was not the company’s fault.

He acknowledged Thursday that commission staff had first raised concerns last year about social and environmental justice issues, and had repeatedly advised Cal Am to withdraw its application to allow more time to resolve key desal project issues, but said it only recently convinced company officials.

Svindland said Thursday that Cal Am could probably “squeak by” with enough water to supply its Monterey-area customers for the time being given the decrease in water demand even with the river cutback order, but said that assumes the Pure Water Monterey recycled water project is providing its full promised 3,500 acre-feet of water per year and includes the prospect of emergency rationing

during parts of the year. He added that a parallel pipeline would also be needed to pump both recycled water and aquifer storage and recovery water simultaneously.

Pure Water Monterey, which began operating earlier this year, is not expected to be capable of reaching its promised 3,500 acre-foot per year capacity until the end of next year.

Asked about pursuing the Pure Water Monterey expansion proposal, which is designed to offer an additional 2,250 acre-feet per year but is largely stalled after the Monterey One Water board narrowly declined to certify a supplemental environmental analysis for the project, Svindland said only “It has issues, too.” Cal Am officials have long argued the expansion would not provide an adequately sized and reliable supply. They would have to sign a water purchase agreement for the expansion project to ultimately move ahead to construction.

In its statement, the city of Marina praised the commission staff’s analysis of the desal project and its repeated recommendations for denial, arguing that the desal project didn’t qualify for required exemptions from the Coastal Act and the city’s Local Coastal Program due to the presence of a feasible alternative in the recycled water expansion, and other reasons.

Marina Mayor Bruce Delgado said city officials knew Coastal Commission staff were closely examining the proposal on “issues of enormous importance to Californians” including environmental justice, water use, habitat protection, sealevel rise and public access

to the coast, and found it lacking.

“It was obvious that the proposed groundwater extraction and desalination project is fatally flawed because of unacceptable impacts in those areas,” Delgado said, and called for Cal Am to instead “move forward quickly and coalesce around a more immediate, affordable, and environmentally acceptable water supply solution” in the Pure Water Monterey expansion.

Public Water Now noted that the commission had been inundated by “hundreds” of letters from Peninsula and Marina residents and organizations opposed to the desal project, as well as letters from state Assemblyman Mark Stone, Supervisor Mary Adams and 25 local elected officials.

Cal Am spokeswoman Catherine Stedman noted that Marina stakeholders in the past have indicated an interest in receiving a portion of the desal product water or owning a portion of the desal project. Stedman said Cal Am had already offered a customer assistance program as part of proposed conditions of approval at the commission that included a 50% discount for lower-income customers.

While the application withdrawal only affected a consolidated coastal development permit, and Cal Am’s appeal of Marina city’s denial of a coastal development permit for a desal project well field at the CEMEX sand mining plant site remains active, Svindland said the commission has effectively combined the issues into one.