How San Diego secured its water supply, at a cost


As a worsening drought forces millions of Californians to face mandatory water restrictions, one corner of Southern California has largely sheltered itself from supply-related problems: San Diego County.

For western water planners, the way there serves either as a blueprint or as a memorial.

Over the past three decades, San Diego County has diversified its water supply, advanced environmental protection, and invested in significant water infrastructure, including the western hemisphere’s largest desalination plant, which removes salt and contaminants from seawater. As a result, the water agency, which supplies 24 water utilities, including the city of San Diego, says it can avoid cuts until at least 2045, even during dry spells. But this security has its price.

San Diego County’s water is among the most expensive in the country, costing about 26% more at the wholesale level in 2021 than that of the Metropolitan Water District, which serves Los Angeles and surrounding counties. Now two rural irrigation districts in San Diego County, home to big avocado industries, want to break away from the regional water utility, saying they can buy cheaper water elsewhere. If they succeed, San Diego County’s water could become even more expensive.

“San Diego’s situation is very surprising, very striking,” said Michael Hanemann, an environmental economist at Arizona State University who was recently hired to study the region’s water costs for a California agency. “I think this is a harbinger of something that’s going to happen elsewhere in California and elsewhere in the US.”


San Diegos haven’t always recovered well during the drought. In the 1990s, a severe drought cut the region’s water supply by 30%. Back then, almost all of the water came from the Metropolitan Water District, the country’s largest water utility. That experience and a strained, dysfunctional relationship, say California water experts, with Los Angeles water authorities have spurred San Diego County’s aggressive, decade-long quest for water self-sufficiency.

“It was at that point that our community came together and said, ‘We’re not going to get into this situation again. We need to plan for our own reliability,” said Sandy Kerl, general manager of the San Diego County Water Authority.

Therefore, in 2003, the Water Authority struck a deal to source water from the Colorado River’s largest single user, the Imperial Irrigation District in Southern California. San Diego County funded repairs to leaky sewers owned by Imperial and signed a historic water transfer agreement. Today, as part of the deal, the company will receive about 55% of its total offering from Imperial.

The Water Board also helped farmers use less water. It built dams to increase storage capacity in reservoirs. It offered rebates to homeowners who uprooted grass lawns for water-efficient alternatives.

In 2012, San Diego County forged a deal to source 10% of its water supply from the Carlsbad Desalination Plant for the next 30 years. The facility produces 50 million gallons of potable water a day — enough for about 400,000 people — and is by far the region’s most expensive water source.

“All in all, it’s twice as expensive as imported surface water,” says Hanemann. “On the other hand, it’s a very reliable supply because it’s not affected by drought and low water levels in rivers in Northern California or Colorado.”

As these efforts caught on, demand steadily declined, even as half a million more people moved to San Diego. Federal water cuts during the drought, more efficient showers, toilets and faucets, rebates for weed uprooting and the use of recycled water have all done what they were supposed to do – greatly reduced water use per person. By 2020, San Diego was using 30% less water than it did in 1990.

However, water authorities did not foresee the imminent decline in demand and constantly overestimated water needs. Today, San Diego County says it’s no longer looking for more water, a position some in the West might find enviable. But they would not envy the water prices.

Thanks to lower water sales, San Diego County has increased rates — by an average of 4% for each of the past five years — to cover fixed costs including the San Vicente Dam and desalination plant. Such costs account for the lion’s share – around 90% – of the Agency’s annual expenditure.

The price of water, Hanemann said, is largely determined by the infrastructure that moves and stores it. “You’re screwed if you’re suddenly supplying fewer gallons of water because your costs aren’t going down.”

“Water is a terrible business because we have to get people to use less of our product and charge them more if they do,” said Tom Kennedy, general manager of the Rainbow Municipal Water District, one of the two water boards who are trying to get it detached from the San Diego County Water Board.


Rainbow and Fallbrook, the other city whose agency is trying to source its water elsewhere, say doing so would give them access to cheaper water, though the potential savings are not yet known. A government agency is reviewing whether they can go, and a decision is expected by the end of the year. If her exit is approved, the next step would be a vote among residents. Only if this vote is successful can the two districts leave.

At a recent public hearing, angry residents shouted at officials about how long the process is taking – and how expensive their bills have become in the meantime.

The country towns provide a striking contrast to San Diego’s constellation of beach towns and waterfront skyline. Steep, arid hills and extensive gorges characterize the landscape north-east of the city.

High water costs have hurt agriculture in Fallbrook and Rainbow, once the country’s largest producer of avocados. Between 2016 and 2020, Fallbrook lost nearly a fifth of its avocado groves due to urbanization and idle groves, government records show.

Jason Kendall, a Rainbow farmer whose family eradicated their avocado groves years ago, said growing the fruit without additional groundwater is a losing proposition.

“You just can’t be profitable buying local water and growing avocados,” said Kendall, who has 350 acres (142 hectares) of cut flowers that are widely grown in the region.


San Diego County water officials say other parts of California and the West face higher water bills, even though desalination is less popular today than it used to be. Recently, a California Coastal Commission denied Poseidon Water permission to build another decade-long desalination plant about 60 miles (97 kilometers) up the coast in Huntington Beach. The rejection came after years of opposition from environmentalists.

The rest of the state has work to do, San Diego County officials said, as climate change continues to exacerbate droughts and shrink the rivers that feed California’s reservoirs and Colorado River.

“There’s no such thing as cheap water anymore,” said Kerl.


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