Proceeding Number A.12-04-019 JOINT OPENING BRIEF ON PLANT SIZING IN SUPPORT OF APPROVAL AND IMPLEMENTATION OF SETTLEMENT AGREEMENTS

ABSTRACT: Re: In the Matter of the Application of California American Water Company (U 210 W) for Approval of the Monterey Peninsula Water Supply Project and Authorization to Recover All Present and Future Costs in Rates, JOINT OPENING BRIEF ON PLANT SIZING IN SUPPORT OF APPROVAL AND IMPLEMENTATION OF SETTLEMENT AGREEMENTS document, (For: Monterey Peninsula Regional Water Authority, California-American Water, Monterey Regional Water Pollution Control Agency, Both the Monterey Peninsula Water Management District and the City of Pacific Grove, Coalition of Peninsula Businesses), is embedded. Importantly, CONCLUSION As Mayor Burnnett postulated at the settlement hearing, “[w]hat public policy would be served if [the desalination plant] were sized” in a way that did not mean that on “the day that the plant comes on line, Cal-Am would need to file a new application for some other water supply project that would presumably not have the economies of scale….”113 The answer is clear: none.
The proposed sizing for the desalination plant is the product of careful analysis and planning, as well as extensive negotiations. By industry standards, it is exceptionally conservative in keeping the plant’s size to a minimum in light of reasonable estimates of future demand. Of course, the many variables that will determine future demand are difficult to predict with precision. However, a reasonable degree of caution is warranted to “insure” against the numerous and significant adverse consequences of undersizing the MPWSP, including provoking another moratorium, harming the area’s economy, loss of economies of scale and higher long-term water supply cost, increased environmental impacts, and unnecessary future conflicts between stakeholders in Monterey County. Moreover, any error in slightly oversizing plant would allow Cal-Am to reduce the desalination plant’s operating level to closer to normal industry standards. As such, the proposed sizing for the plant should be adopted.

Joint Opening Brief on Plant Sizing in Support of Approval and Implementation of Settlement Agreements

Filing Date 01-21-14
JOINT OPENING BRIEF ON PLANT SIZING IN SUPPORT OF APPROVAL AND IMPLEMENTATION OF SETTLEMENT AGREEMENTS