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????They once promised to be the solution to one of desalination’s biggest drawbacks. Most of the world’s 14,000 desalination plants draw seawater directly from the ocean, sucking in varying amounts of sea life. But slant wells, sharply angled in order to pump water from below the ocean floor, would use the sea bed as a natural filter, leaving all the aquatic critters where they belong.

That idea turned into a noble but failed experiment as California American Water began the long and expensive process of building a desalination plant to solve the Monterey Peninsula’s water problem. At the direction of state regulators, including the California Coastal Commission, Cal Am adopted slant wells into the design and for the past several months has been testing one such well at the plant site next to the Cemex facility on the Monterey Bay shore north of Marina.

The testing was delayed because of political opposition, concerns about feasibility and questions about whether the environmental impact of the testing itself had been fully considered. Once it started, it encountered additional delays for technical reasons and the discovery of a glaring conflict of interest. One of key hydrologists involved in the design and execution of the testing turned out to be a patent holder on the technology being tested, calling into question the advice he was giving his employers, both Cal Am and Cal Am’s chief regulator, the Public Utilities Commission, a compound relationship that created yet another conflict.

At one point, the testing was halted because a monitoring well showed that groundwater in the area was dropping significantly. Among the factors being tested is the desalination plant’s impact on area groundwater and, most specifically, an underlying aquifer that extends all the way to the Salinas Valley and supplies much of the water that sustains Salinas Valley agriculture. Though the intent is to draw seawater exclusively, the test well in fact draws a significant amount of its water from the brackish oceanside edge of the aquifer. If the desalination process draws too much water from the aquifer or aggravates the existing issue of seawater intrusion into the fresh water aquifer, the desalination plant’s design and/or location seemingly would be doomed, absent a purely political solution.

According to Cal Am’s declarations to state officials, the testing remains highly inconclusive but the company says it has learned enough from the exercise to plunge ahead into the overall plant approval process and then into the construction phase, which would result in the drilling of an additional nine slant wells. According to water activist George Riley, the company has already started awarding well-drilling contracts despite the absence of any data supporting that decision.

If the plans continue on that track, the Marina plant would be the first in the world to use slant wells. Recent tests of the same technology at a proposed Dana Point plant failed dramatically, taking in as much fresh water as salt water, and operators of a proposed plant at Huntington Beach, also under state pressure to use slant wells, recently announced the technology there to be unfeasible.

Against that backdrop, an array of speakers at a forum sponsored by Public Water Now lined up Tuesday night in Carmel to explain why the slant-well plan should be abandoned in the name of maintaining some semblance of control over the desal costs.

Public Water Now founder George Riley ran out of descriptors as he labeled the slant-well approach “a sham, a hoax, a fraud” because it provides none of the benefits that its supporters promised and carries with it unacceptable costs and complications. The most recent cost estimates show that water from the proposed Cal Am plant would cost more than double the costs expected in either Dana Point or Huntington Beach.

Public Water Now was formed to pursue public ownership of Cal Am, an idea that Monterey voters narrowly rejected a year ago. Riley and the organization support desalination as a solution to the region’s water-supply problem but they argue that the state Public Utilities Commission will be making a huge and expensive mistake if it does not order serious study of alternate, cheaper proposals, the People’s Project and Deepwater Desal, or does not toss out the slant-well approach on grounds of inefficiency and expense.

A partial solution to one of the slant-well technology deficiencies was announced Tuesday, when Cal Am revealed a plan to sell fresh water to the Castroville area. The fresh water to be sold is same fresh water that the slant wells will draw into the desal plant, where it will be processed along with the sea water. That agreement settles one of several potential water rights disputes that Cal Am faces but it is an imperfect solution to a problem that would not exist if the slant wells worked as intended. The volume of freshwater pumped from the aquifer essentially increases the size and cost of the desal plant, an expense borne by Cal Am customers, but Castroville is not expected to pay a commensurate amount.

Among the revealing presentations Tuesday was one by retired mathematician and computer language expert David Beech. He demonstrated how Cal Am has misled the public and even the Coastal Commission by repeatedly suggesting that the test well would extend 1,000 feet into the sand below Monterey Bay. In fact, Beech showed, the drilling angle and the location of the inland wellhead reduce the overall length to just 724 feet and the net effect is that only the final 35 feet of the well are in contact with ocean water.

Most of the water pumped into the desal plant under the current design would come from the freshwater aquifer, Beech and others concluded, which strongly suggests that there is no reason to use expensive slant-well techniques when vertical wells drilled directly into the aquifer would produce approximately the same result. The idea of switching to vertical wells was even endorsed Tuesday night by Paul Bruno, president of Monterey Peninsula Engineering, an aggressive backer of Cal Am’s desalination project. EDITOR’S NOTE: Bruno now denies having said this. He said his comment was that vertical wells would be less expensive than slant wells. 

Another speaker, water activist and retired teacher Michael Baer, complained that Cal Am and its contractors still have not fully tested the potential ramifications on the groundwater despite repeated urging from a hydrologist working for Salinas Valley ag interests.

Ron Weitzman of the Water Ratepayers Association of the Monterey Peninsula, another proponent of public ownership and alternate proposals, used computer modeling to demonstrate his assertion that Cal Am has intentionally manipulated its measurements of sea level and groundwater levels in order to make its plans appear logical.

Riley noted that the cost of the testing has risen steadily, adding additional costs to a project that will result in astronomical water bills throughout Cal Am’s local service area. The initial estimate for the testing was $4 million, which rose to $7 million as a result of both avoidable and unavoidable delays. It rose next to $10 million, which doesn’t include the costs of special review by scientists at the Lawrence Berkeley National Laboratory. The overall cost of the plant is now estimated at more than $300 million.

If Cal Am shareholders were responsible for the costs, they would have ended the slant-well experiment long ago in favor of something more efficient and less expensive, Riley insisted. Unfortunately, though, common sense does not prevail when the regulators and the utility know that the costs of every misstep will be passed directly to the water ratepayers.

Riley said there is no longer any question that a desalination plant will be built. A looming cease-and-desist order on the overuse of Carmel River water has created enormous political pressure to find a solution and nothing on the horizon presents meaningful competition to desalination, Riley acknowledged. It is entirely likely, he said, that the various state agencies will approve the overall project even before the environmental impact study for the plant has been completed and before various other water rights issues have been adjudicated.

What is important now, he said, is for Cal Am customers and their elected leaders to persuade state officials to stand up to the momentum and take a long and deep look at the costs of staying on the current path. Both the alternate plant proposals and simpler well technology promise lower costs for the ratepayers, he said, and it is the responsibility of officialdom at the local and state levels to do everything they can to take the sting out of future water bills.

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Cal Am rate increases, all lined up as far as you can see

Red 3d 40% text on white background. See whole set for other numbers.

Your Cal Am bill is going to be going up again. If you’re thinking 30 percent, you’re getting warm. Thirty-five? Warmer. Forty? Good guess

RATES UP FOR MOST BUT DOWN FOR COMMERCIAL USERS

When I received my most recent letter from Cal Am, I knew it wasn’t a late Christmas card. The first thing I noticed was the little blue box in the lower corner. “See inside for important information about your rates.”

Based on experience, I was pretty sure this was not signal of lower rates. I was right, but only half right.  More on that in a bit.

The mailing announced a Jan. 27 workshop on California American Water’s application to modify some of the conservation and rationing rules that affect most of the company’s customers in Monterey County, and to make some changes in the “rate design.”

On the last page I discovered that this means an increase in my water rates. As a somewhat typical water customer in a single-family home, I can expect to see my bill go up by about 40 percent. I should count myself lucky that I don’t live in an apartment because if I did, my bill would be going up about 43 percent.

Why is this happening? Didn’t Cal Am get a rate increase like 20 minutes ago?

I read the whole thing rather thoroughly and couldn’t find anything about improvements to the system or to service, fixing leaky pipes, or solving the water supply problem or saving fish in the Carmel River. None of that frivolous stuff. I didn’t see any talk about the rising cost of taking Public Utility Commissioners to dinner. As far as I can tell from the four-page letter, my bill is likely to go up because Cal Am wants to change the way it calculates bills, the way it applies conservation rates and how it does other things that have no impact on me other than increasing my bill.

Cal Am says, without explanation, that it wants to charge increase “the service charge to recover 30 percent of residential fixed costs, compared to a 15 percent recovery currently.”

Perhaps we should be relieved. What if Cal Am had picked 40 percent or 50 percent instead of 30 percent?

According to the letter, Cal Am also wants to charge me more by collecting money in the future that it should have collected from someone, who knows who, in the past. In other words, someone slipped up and failed to wring every dollar out of us at some point and the company thinks it should be able to remedy that. I have to presume that I was not the person or persons who should have paid more in the past because I am fairly certain that Cal Am has never missed an opportunity to get every possible nickel from me.

This is not a done deal, of course. It is part of an application before the Public Utilities Commission, which, if the past is a good predictor, will likely approve the requested increase and present Cal Am with an award for creativity and accounting prowess. This also is not a full reflection of what is likely to happen to your water bill in the near future. Cal Am rate increases are a lot like El Nino storms. Right behind this one, there’s another one taking shape.

But what of the lucky others whose rates aren’t going up? Those would be the Cal Am customers in the commercial category. They apparently aren’t being affected by most of the changed accounting procedures Cal Am wants to implement but they would be impacted by the effort to collect money that previously uncollected. On account of that, commercial ratepayers can expect to see their bills go down by about 9 percent.

If this is explained in any meaningful way in the letter, it is written in invisible ink.

It is difficult to see why commercial rates are to go down. Based on the information at hand, it could be that Cal Am thinks the uncollected money in past years should have been collected from residential customers and that commercial customers overpaid.

Or it could be that Cal Am just likes commercial customers than it likes the rest of us, or that it is more interested in keeping commercial customers happy.

You may recall that is was just a couple of years ago that Cal Am dramatically cut rates for commercial customers, or at least any commercial customers who were willing to sign a paper certifying that they really into conserving water whenever possible. They did that for various reasons, some of them sound. But I and a few other cynical types suspect that it was part of a deal. Something like this: Back us up on our desalination plans, the rate scheme for the San Clemente Dam removal and on other issues as needed, and we’ll lower your rates, and lower them again at the next opportunity.

Can I prove that? Heck no. In the byzantine world of utility accounting, it becomes ridiculously difficult to prove much of anything.

Now before someone gets all doesn’t-he-understand-that-what’s-good-for-business-is-good-for-everyone on me, I get it, I get it. What I don’t like is that decisions on such things are being made in places where I’m not normally invited and are being reached by people who don’t live anywhere near my neighborhood.

Which takes us to my final point. While there are some good Cal Am watchdogs already – people like George Riley and Ron Weitzman and Charles Cech as well as the fine people at the PUC’S Division of Ratepayer Advocates – I submit that they cannot possibly keep up with the all the rate storms lining up in the Pacific and heading our way.

Cal Am is regulated, and its rated set, by the state Public Utilities Commission, but that body in recent years has been preoccupied with keeping PG&E shareholders happy and overwhelmed by the need to monitor each public utility in this huge state.

Here’s what I think. We need someone in Monterey County, some highly credible person with great accounting skills, to take on the task of analyzing and reporting on all Cal Am rate increase requests and analyzing the company “rate design” and everything else it has or does that impacts our water rates.

Once upon a time, the Monterey Peninsula Water Management District had some role in regulating Cal Am. That function has mostly gone away, but it seems entirely reasonable that the district hire someone to perform the function I propose.

Another possibility is the mayors’ water authority. Its primary function is to advance the Cal Am desalination project, the biggest storm of all, and to provide some level of public scrutiny over that venture. Seems to me it would be well equipped to take on the task.

The Monterey County Board of Supervisors could make it work as well if the members really wanted to, though the county wouldn’t be my first choice.

I see this person issuing public reports on Cal Am rate proposals and representing area residents at rate hearings before the PUC. A key function: educating Cal Am customers to the point that we could represent ourselves at rate hearings.

Some of the work would duplicate work already being done by the Division of Ratepayer Advocates. The difference is that the division is responsible for the entire state and must constantly change its focus. This person would have one mission – making whatever Cal Am is up to make sense.

There are those out there doing some of this work now. The George Rileys and Ron Weitzmans. But they cannot keep up with the volume it on their own, without someone able to devote full time to the effort. Rate applications consume hundreds of pages of fine print and tie into previously approved side deals, surcharges and recalculations. Only someone devoting full time to the challenge has any hope of ever understanding all of it.

Expensive? Kind of. What isn’t? an energized and effective person in this role could save Cal Am customers, including businesses and government bodies, more than enough to cover expenses, more than enough many times over.

Right now, Cal Am has us right where it wants us. Divided. Confused. Overwhelmed. The PUC has no motive to fix that and neither does anyone else. We need to create our own seat at the table.

About that workshop, it’s at 2 p.m. and again at 7 p.m. Wednesday Jan. 27 at the Oldemeyer Center, 986 Hilby Ave., Seaside. Presiding over the sessions will be an administrative law judge for the PUC. 

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Read This Unless You Like High Water Bills

????Should large commercial and industrial concerns on the Monterey Peninsula receive preferential water rates, lower than the rates paid by California American Water Co.’s residential customers?

It is a fairly simple question but there’s nothing simple about getting it before the public for meaningful discussion. The public was shielded from the process before the special commercial rates were enacted a year ago. Now, a public forum on the issue may or may not take place Oct. 13 in Monterey. Cal Am seems to have agreed to take part but hotel industry representatives aren’t so sure they want to see that happen.

Some background, and then you decide for yourself what to make of it.

Since last October, the hotel industry and other large water users have enjoyed a price break that was negotiated in private by Cal Am, industry representatives and the California Public Utilities Commission. The Monterey Peninsula Water Management District was also involved in the discussions though its role isn’t entirely clear.

The business interests wisely recognized that Cal Am rates were headed up and nothing but up over the next several years. They feared, among other things, that the cost of the proposed desalination plant plus other efforts would double or triple their water rates, potentially devastating the hospitality industry and others with heavy water needs. So they banded together as a coalition of big water users, hired accountants, lawyers and other representatives, and created a price structure based on flat rates, as opposed to the tiered rates that are intended to promote conservation among residential water customers. They also managed to get for themselves relatively low rates for any businesses claiming to have taken significant conservation measures. No proof required.

It is entirely possible, of course, that special water rates for private industry is in everyone’s best interest. The “What’s Good for GM” argument. If higher water costs resulted in hotel closures, higher hospital bills and lower taxable income for some enterprises, the impact on the entire Peninsula could be more harmful than relatively high water bills for residents. Presumably that was a big part of the pitch the business community made to the Public Utilities Commission, but there’s no real way to tell. There’s also no way to tell whether anyone responded on behalf of the residents’ interests or was allowed to join into the cost-benefit analysis.

As of last October, the steeply tiered rate structure for residential customers on the Peninsula started at 56 cents for the first 100 gallons supplied to a household with minimal water usage.

For a household on the other end of the conservation spectrum, a household irrigating significant landscaping and doing little to keep use down, the rate potentially topped out 10 times higher, $5.65 per 100 gallons, not counting various surcharges. The rates at the high end help explain the well-publicized cases of monster water bills for households experiencing water leaks or phantom usage. (These figures come from Cal Am’s public rate schedules from a year ago so they could be both out of date and overly simplified, but they remain useful for comparison purposes.)

Until last October, commercial users were charged one price if they kept their water use below a monthly allotment based on type of business, past usage and size. They were charged a higher price if they exceeded their allotment.

Since last October, the rates for commercial users have started at 89 cents per 100 gallons, higher than the bottom-tier residential rate. That is for commercial users who do relatively little irrigation and who submit paperwork claiming they have adopted solid conservation techniques.

Enterprises with irrigation requirements closer to average pay a rate about 12 percent more. Those that irrigate more than 10 percent of their property, and who claim to be fully compliant with best conservation practices, pay about 12 percent on top of that, or about $1.11 per 100 gallon.

For practical purposes, that makes $1.10 per 100 gallons the highest effective commercial water rate, as compared to $5.65 for residential users. Technically there is a higher commercial rate, more than $2 per 100 gallons, but that is only for businesses that don’t even claim to be following good conservation practices. It seems unlikely that any business would remain at that level for more than one month. Even those businesses would be paying less than half as much per unit as residences at the highest tier.

(For commercial users, the new rate structure actually uses 75 gallons as the standard unit of measurement rather than the 100 gallons in place for residential users. It has been suggested by cynics that it is meant to make comparisons more difficult.)

When the Public Utilities Commission approved the special commercial rates, there was little publicity beyond a news article and an editorial in the Monterey Herald. I wrote the editorial, raising questions about the different rate structure and the process used to create it. Personally, I received only one call of complaint. It was from  Mike Zimmerman, who is now the chief operating officer for the Cannery Row Co. He said he would set up a meeting to discuss the issue and would call back. He didn’t.

I speculated at the time that the hotel industry decided to go low-profile, hoping the rate structure not receive much attention. I suspect that may still be the case.

The issue finally began generating some interest earlier this year during the campaign over Measure O, which would have started a formal effort toward a public takeover of Cal Am. Now, Public Water Now is pushing for some public discussion of the rates and the ramifications. Public Water Now, by the way, was not daunted by Measure O’s failure and is continuing its public-ownership effort.

Plans for the Oct. 13 session apparently grew out of an Aug. 19 Monterey City Council session in which Cal Am representatives made some sort of a presentation about rates. The minutes don’t reflect exactly what was said, but some went away believing that Cal Am was on board for a wider ranging discussion of rates of all types. Out of that session, Public Water Now’s George Riley proposed an October workshop on the topic of commercial vs. residential rates. An exchange of emails since then seems to put the idea in question, however.

In one, John Narigi of the Monterey Plaza Hotel told Riley that Cal Am had not agreed to a discussion involving the commercial rates.

“It was an agreement to discuss and provide additional information/education regarding the current rates for residents and answer additional questions regarding this specific topic,” Narigi wrote.“You are now asking for a panel discussion on ‘whatever topics the parties want and would assume the public as well’??? Please provide an honest and accurate agenda so we the coalition can decide if there is even a need or desire to participate.”

The coalition Narigi mentioned is the Coalition of Peninsula Businesses, headed by the Monterey County Hospitality Association.

In an email to Narigi, Ron Weitzman of the WaterPlus group said his understanding was that the discussion would involve both commercial and residential rates.

“There are obviously two sides to the issue. To hear only one side would be propaganda, not education,” wrote Weitzman. “…We do not question your need to be rid of the tiered rate structure. Residential ratepayers would also like to be rid of it … .”

So there you are. See you at Monterey City Hall on Oct. 13. Or not. The hotel industry will let us know.

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