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What’s the Projected Future Demand for Water on the Monterey Peninsula? A State Regulatory Agency Decides on June 26
By the end of 2025, our regional wastewater treatment and recycling agency Monterey One Water (M1W) expects to produce additional water after it completes its expansion of the Pure Water Monterey Groundwater Replenishment Project (PWM/GWR). (This project began producing recycled water in 2020.) As a result of this expansion, M1W will increase the amount of recycled water it sells to the Monterey Peninsula Water Management District (MPWMD), which in turn sells that water to California American Water Company (Cal Am) to provide to its customers.
Cal Am and MPWMD had to amend their existing water purchase agreement to incorporate sales of the additional recycled water. On November 29, 2021, Cal Am submitted an application to the California Public Utilities Commission (PUC) for regulatory approval of such an agreement. Cal Am also asked for approval to charge ratepayers to recover costs related to supplying that additional water (such as construction of Extraction Wells 3 and 4, the Carmel Valley Pump Station, and the General Jim Moore Parallel Pipeline). And Cal Am asked PUC to update water supply and demand estimates for the Monterey Peninsula. Proceedings have now gone on for three-and-a-half years: see documents related to the case (including rulings, decisions, and public comments) by going to Proceeding Information Search and entering A2111024 next to “Proceeding Number Search.”
On December 5, 2022, the PUC issued a decision approving an amended water purchase agreement between MPWMD and Cal Am. The water purchase agreement includes an increase in Cal-Am’s commitment of water purchases from 3,500 acre-feet per year (AFY) to 5,750 AFY over 30 years, with an option to extend that commitment for another ten years. It also includes conditions that apply if MPWMD cannot provide 5,750 AFY of water, including a right for Cal Am to terminate the agreement if M1W and MPWMD cannot meet guarantees for water availability, water delivery, and water treatment.
Next, the PUC will vote at its Thursday, June 26 meeting on its new Demand and Supply Estimates for the Monterey Peninsula Water Supply Project (Item 8). Cal Am believes PUC estimates are too low (11,204 acre-feet per year in 2025 and 13,732 acre-feet per year in 2050), but is willing to accept the proposed PUC decision. Meanwhile, opponents of the Cal Am proposed desalination plant and supporters of the government takeover of Cal Am (generally the same people and organizations) point out that demand dropped from an estimated 17,000 AFY in 1995 to a 50-year low of 8,971 AF in Water Year 2023-2024. They claim Pure Water Monterey expansion will satisfy all water demand for decades to come.
To some extent, assertions about future water demand are based on two competing visions for the future of the Monterey Peninsula. Your Chamber supports a reasonable degree of economic development and population growth and recognizes future water demands will necessitate a desalination plant or some other source of additional water. While conservation programs and high water costs may have contributed to some reduction in water demand, government regulations have also served as a powerful tool to reduce demand. Our region has experienced constraints on commerce, population stagnation, demographic change as younger middle-class families have left the area, enrollment decline in local school districts, skyrocketing housing prices, a virtual stop to construction of new housing units, and an ongoing threat of local military base closures. These conditions undermine a prosperous, vibrant, diverse community that allows Chamber members to flourish.
Contact Monica Lal at 831 277-2279 or at monica@montereychamber.com if you want to make comments on Thursday to the California Public Utilities Commission.
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