The Economics Of San Diego’s Water Supply
Tuesday, July 20, 2010
Find out what San Diego leaders need to do to ensure an adequate supply of water for the people of the region.
MAUREEN CAVANAUGH (Host): I'm Maureen Cavanaugh, and you're listening to These Days on KPBS. You see the signs everywhere around the city of San Diego. They tell us to waste no water. As it turns out, city leaders may have identified the single most effective way to sustain San Diego's water supply. A new study concludes that conservation is the cheapest and most accepted form of water management in the county. But the study also finds that conservation alone will probably not be enough to ensure adequate water for a growing population and a shrinking import supply. Joining me to talk about the new water study are my guests. Dr. Lynn Reaser is chief economist at the Point Loma Nazarene University Business and Economic Institute. And, Lynn, welcome to These Days.
DR. LYNN REASER (Chief Economist, Point Loma Nazarene University Business and Economic Institute): Thank you, Maureen.
MARION PAUL (Executive Director, Equinox Center): Good morning.
CAVANAUGH: And we invite our listeners to join the conversation. How do you think San Diego can make its water supply more sustainable in the coming years? How would you feel about paying more for water to encourage conservation? Give us a call with your questions and your comments. Our number is 1-888-895-5727. That’s 1-888-895-KPBS. Lynn, as I say, conservation tops the list of water solutions in this study. Why did it rank so high?
DR. REASER: Conservation ranks very highly because if you look at the other potential alternatives, desalination, recycling, they require either large capital investments, a lot of money just spending to keep operations going, transportation costs, for example, treatment costs, or they’re very energy intense. So conservation is probably going to be our cheapest and most effective way to deal with this problem. And it’s to be noted that globally, water is probably our most precious commodity and will be the biggest challenge facing China, developed countries, and developing countries as well.
CAVANAUGH: Now, we tend to think of water conservation as linked with cycles of drought but it seems from your report that you’re really looking at conservation a different way to use water, a way to use it more conservatively as a long term need for San Diego.
DR. REASER: As we see California’s population, particularly in Southern California continuing to rise over the coming years, as we see global warming which scientists generally agree is a coming phenomenon, ongoing phenomenon, challenging supply on either a year-on-year basis over the long term, we will see competing demands challenging our water from the other parts of the states, from the Central Valley, from Mexico, the Colorado River, and so we will need to conserve. There’s no way out of the box.
CAVANAUGH: I want to talk to you more in a moment or two about what you see as that shrinking import supply for San Diego but is there any way that we can quantify how much water we will actually save by conservation? Do we have any statistics about that? Can we do any planning based on that?
DR. REASER: We would need to do that study and we’ve been talking to Equinox Center about the importance of doing that. It certainly can be quantified. We could actually estimate how much conservation, just voluntary efforts, how much some of the mandatory restrictions, how much the economy, and how much pricing has all contributed to this conservation drive. We, at this point, examine as our first step the supply side, looking at different alternatives, desalination, recycling, brown water, to see what we could learn from the supply side. The demand side will be the second part of the equation.
DR. REASER: Marion, you might have some comments on that.
CAVANAUGH: So that’s a study that’s yet to be done. I just want to tell our audience I’m speaking with Dr. Lynn Reaser. She’s chief economist at the Point Loma Nazarene University Business and Economic Institute. In a moment I’ll be talking with Marion Paul. She’s executive director of the Equinox Center. And we’re inviting your participation. What do you think about San Diego’s making San Diego’s water supply more sustainable in the coming years? What about paying more for water? Tell us what you think. 1-888-895-5727. Marion, first of all, what is the Equinox Center?
PAUL: Well, the Equinox Center is a research and policy organization that focuses on sustainability issues for San Diego County. We’re trying to answer the question what happens to our scarce resources when you add 750,000 more people in the next 20 years. Water is clearly one of those important issues.
CAVANAUGH: And how is this report different? We’ve seen an awful lot of water studies in Southern California and in San Diego. How is this one different?
PAUL: Well, I think from San Diego’s perspective it’s different because it looks specifically at San Diego County. And the other thing that we bring to the table or we don’t bring to the table is an agenda. We’re a independent, nonpartisan organization that was actually begun by a group of philanthropists who care deeply about the quality of life here. And so they funded this study so we could look at what are the water options for the future? How can we grow intelligently?
CAVANAUGH: And, Marion, there also seems to be another difference in this study, is that the tack it’s taking is looking at these alternatives not necessarily from an environmental point of view but from the point of view of economics.
CAVANAUGH: Tell us about that.
PAUL: Well, Equinox Center has three basic values that we base all of our decisions on and all of our recommendations on, and that is a healthy environment, which is important to all of us, a strong economy, which is where the economics for this comes in, and vibrant communities so that we’re – that really means quality of life. We all love living in San Diego. We’d like to keep it that way.
CAVANAUGH: And – But, I mean, the thing that I’m trying to get at here is you looked at these water sources through an economic lens rather than, you know, just simply supply and demand, how much it’s actually going to cost to bring this water supply to make either these alternative water supplies available or to maintain the kind of water supply that we get, let’s say, from imported water. Why did you take that tack, Lynn?
DR. REASER: I think it’s very important to have the economics understanding. We look at, for instance, energy and environmental issues. In times of prosperity, people do the right thing. They conserve, they try to be green, they try to be environmentally friendly. But when times are tough, they look for the bottom line. Companies will start to do what makes sense just to survive the bad economy, and so it is important that we understand the economics of water, of energy, of different environmental issues, and do the thing that will make sense to households, to individuals, to companies, so that they will follow the path that will ultimately be sustainable.
CAVANAUGH: So you’re trying to take it out of the sky as perhaps the right thing to do and make it the – try to examine what it actually the best, most practical thing to do.
DR. REASER: Yes, we look at the cost, the bottom line to utilities, to costs that companies and individuals also may be forced to pay, but economics is not just dollar signs. It has a wide range of elements and so we looked at the study also at energy factors and then we looked at the other elements as well. Availability, how much of the raw resources there, for instance, of water. There’s a lot of ocean water, there’s a lot of waste water, not a lot of rainfall on a year-to-year basis. We looked at reliability, we looked at legal costs, we looked at the environment, so we looked at a wide range of elements which, even from an economist’s lens point of view, are important and should be part of the overall analysis.
CAVANAUGH: Okay, so we talked about conservation, that was the number one on your list. What are the other possible sources of water that you examined?
DR. REASER: Well, a couple of very interesting ones were recyclable, both potable and non-potable. The potable, which you can drink, comes out really quite favorably in terms of overall moderate cost. It does cost in terms of treatment but it can be done on an economic basis. Its shortfall is that it’s fairly energy intensive in terms of transportation cost. For instance, if you look at the option of using the San Vicente Reservoir, basically you take the water after it’s treated, pump it back to the San Vicente Reservoir, augment it there, and then it’s distributed through the existing pipe system to consumers, and this has proven to be, in other areas of the world, even in California, in San Diego County, to be a acceptable, very safe process. So that’s one option. The other is to use, as part of our water overall option, recycled water for irrigation that’s not drinkable but could be used for landscaping, it can be used for some industrial processes. And the advantage there is it’s pretty efficient on the energy side, not a lot of energy. It’s pretty effective in terms it doesn’t require all the treatment that drinkable water does. The problem for San Diego County and the challenges, you’ve got to have a whole separate piping system. You’ve got to have one piping for the drinkable water and then a whole ‘nother piping system, what they call purple pipes…
DR. REASER: …for the non-drinkable. And it’s great if you’ve got a brand new development. You just put the new pipes in when you start. The problem with San Diego, you’d have to rip up all the ground and put in this new piping system and it costs about $2 million a mile. So that’s the constraint. But it certainly is a very important option that we should consider along with desalination as well.
CAVANAUGH: We have a number of people who want to join our conversation. We’re taking your calls at 1-888-895-5727. Bruce is calling us from San Diego. Good morning, Bruce. Welcome to These Days.
BRUCE (Caller, San Diego): Good morning.
BRUCE: So I just wanted to first thank Equinox Center for putting this study together. I had a chance to read it last night and I thought it really hit, you know, the nail on the head with water supply policy. And what I think is most challenging and frustrating for a group like Coastkeeper, and basically devalidated a lot of our positions through the last few years is, you know, it seems like, frankly, our elected officials don’t get it. Basically, you know, when you look at where right now the amount of energy and resources going from the decisionmakers in San Diego, it’s really focused on more water imports, a peripheral canal, purple pipe, and desalination, which rank exactly at the bottom of your report. We’re not seeing a lot of political will and energy and resources toward conservation and, frankly, you know, the only reason water recycling is up there is because groups like Coastkeeper and Surfrider have been pushing it. And I just wanted to kind of lay out that we can get water accomplished in San Diego, we can actually get a reliable supply by really focusing on sustainable conservation, indirect potable reuse and other strategies that are both more environmentally friendly as well as cost effective and yet just this week on the 22nd, the County Water Authority is going to be talking about putting hundreds of millions of dollars of subsidies into desalination that could be used for these more sustainable, more energy efficient and more cost effective supplies. So we have this huge disconnect between the science and the policy, and what our elected officials are doing. And I know it’s not Equinox’s Center role (sic) to advocate, it’s really an independent but I’d love to get your take on that.
CAVANAUGH: Sure. Thank you, Bruce. Thank you for the call. Where did desalination rank? It’s pretty low on the list, is that right?
DR. REASER: We had a number of different factors that we put into our matrix…
DR. REASER: …and so if you look at, for instance, availability, reliability, safety, desalination ranks fairly highly. It is, however, a high cost, relatively speaking, and fairly energy intensive way to deal with the water problem and so it ranked low in those areas. I would stress, and I think the caller, Bruce, suggested, that it is important to look at a number of different sources. It’s important to have a diversified portfolio but it’s important not just to look at the supply side. We’re going to have to deal with the water issue, as all other countries around the world, on the demand side and that also, therefore, emphasizes the importance of conservation as a very important part of the picture.
CAVANAUGH: And, Marion, I’m wondering, what does the Equinox Center hope that this new report is going to add to the conversation of public officials as they discuss water alternatives in San Diego?
PAUL: Well, I think what’s important to understand is the report really gives a great baseline data for the cost of building the infrastructure, the cost of energy, and the other factors. There’s a matrix in the study and the study, by the way for the listeners, is on our website at equinoxcenter.org. And the matrix is a great tool. We did not weight the matrix because we felt that there are 24 different districts in the county and each – each district will have a slightly different weighting, depending on the kinds of water resources they have and what the priorities are. So, for example, on desal, if you look at the matrix, if the listeners would go to the site and look at the matrix, they’ll see that it actually ranks very high in terms of available water source and reliable water source but it’s not – it’s just an expensive option.
CAVANAUGH: A very expensive option.
PAUL: A very expensive option. And back to the demand side on conservation, some interesting numbers. Like in the county, we, on average in the county, use about 119 gallons per day for an individual in a residence. And if most people are thinking that’s not possible, you just really need to think how much you use on your landscaping.
PAUL: 60% of that is for outdoor use. Well, in Australia, where they have had an extended drought, they’ve gotten that down to 55 gallons per day and they really haven’t changed their quality of life. That’s what we need to look at here, is there a more aggressive posture we can take in conservation? The more we conserve, the less we will have to spend on major capital infrastructure, something to consider as we move forward. So what we’re hoping the study adds is information to inform the dialogue. There’s lots of – Lynn and her team have just put together the most incredible batch of information for people to look through, hopefully, with a new lens.
CAVANAUGH: We have to take a short break. When we return, we will also talk about the – what this particular study says about our sustainability of the 80% of imported water that San Diego uses, and continue taking your calls at 1-888-895-5727. You’re listening to These Days on KPBS.
CAVANAUGH: I'm Maureen Cavanaugh. You're listening to These Days on KPBS. My guests are Dr. Lynn Reaser and Marion Paul, and we’re talking about a new study conducted by the Equinox Center called “San Diego County’s Water Sources: Assessing the Options.” And we’re taking your calls at 1-888-895-5727. One of the really staggering statistics that we always come up against when we talk about San Diego’s water supply is the fact that 80% of our water, our current supply, is imported. And, Lynn, in this study, you don’t see that that’s a sustainable situation. Tell us why.
DR. REASER: We, going forward, will continue to see population growth in California. That means that not only will we be needing more water here but the rest of the state will be competing for that supply, and that supply is probably going to diminish going forward as we face the possibility of global warming, prolonged periods of drought, as Marion suggests we’ve had in Australia recently, and also the challenges to the Colorado water supply as we see complaints about our tapping of those sources and also the salination of those supplies.
CAVANAUGH: And from what also I read in the report, you have some concerns about the infrastructure that actually brings the water here to San Diego.
DR. REASER: It is expensive to bring imported water to Southern California, very energy intensive because of the transportation cost, and there also is, you know, increasing environmental challenges in the court system to the damage to the ecological system, so this has raised continuing political issues in Sacramento, the agricultural interests versus the urban interests and this is only likely to intensify over the next 20 years. As a result, we estimated projected cost increases for the different water alternatives that might be open to us in San Diego and imported water is likely to show the fastest increase of all the different alternatives we observe.
CAVANAUGH: Taking your calls, 1-888-895-5727. Don is calling us from Carlsbad. Good morning, Don, and welcome to These Days.
DON (Caller, Carlsbad): Good morning. First of all, I am all in favor of conservation. I think it makes very good sense in San Diego County. I think it would be – make even better sense if the rest of the state got on board with this and if we focused on our water challenges as a statewide issue rather than a San Diego County issue. Case in point, Central and Imperial Valleys still flood irrigate tens of thousands of acres of cotton. Agriculture, I’m all for agriculture, especially agriculture for food but growing cotton in the desert climate doesn’t really make much sense. And something like 80% of the water used in California is for agriculture and a significant part of that is to grow cotton. I think what is lacking is political will. One thing, if we simply transitioned out of growing cotton into growing industrial hemp, water usage would go way down, chemical usage would go way down. Secondly, on supply side…
CAVANAUGH: Don, thank you so much for the call. I just – I hate to cut you off like that but I think we were getting away from the topic. If we can talk about San Diego, though, in an isolated environment like this, though, Don’s larger point being is it wise to do a study like this that doesn’t include all of perhaps Southern California and the way water is being utilized in other areas as well?
DR. REASER: Well, certainly understanding how water is used in other areas will be important but San Diego does not have jurisdiction or power over what other parts of the state do. So we started out looking at what San Diego can do in terms of its water alternatives and start from that basis. But, certainly, it would be optimal to have a statewide policy but we cannot control that totally. I would say on the conservation issue, it is important that we move towards a pricing of water that is more rational. When we talk about conservation, there are really four ways you can do conservation. One, you can ask people to do the right thing, use less water, and hope that they recognize, put up signs saying please conserve, and hope they do the right thing. Second, you can give them subsidies. You can help them pay for more water efficient appliances, low-flow showers, for instance, give them drought resistant plants, and subsidize basically their behavior. Third, you can mandate that they act in a certain way. You can only water your grass every other day or you can only water after six o’clock. Or the fourth is the pricing mechanism, basically you price water so that people have an incentive to grow, for instance, crops that are less water intensive, and that probably is going to be part of the picture that will have to be very important as we deal with this water challenge.
CAVANAUGH: Let’s take another call. Lee is calling us from San Diego. Good morning, Lee. Welcome to These Days.
LEE (Caller, San Diego): Thank you. I have a question about gray water and basically captured rainwater. I was told that there was actually rules against that in San Diego. We were thinking of starting one up at the house when there was a lot of rain but I’m not – I was looking for some direction on that.
CAVANAUGH: Who’d like to take that? Marion?
PAUL: To be honest, I’m not an expert on gray water in San Diego. I have read that there are some permit restrictions that make it more difficult for people to implement these. There is a group in Escondido that works very, very hard on these kinds of issues and I would be happy to find that information and put it on our website for the reader to access later this morning.
CAVANAUGH: Terrific, and our website is KPBS.org/thesedays. Marion, in looking at the findings of this report, I’m wondering are there things that surprised you?
PAUL: The thing that surprised me the most was that our imported water was ranked last in the way we weighted it. And that surprised me because it’s such a – it’s the commodity we use the most today of 80%. I really thought others would come out beneath it. And so that was a little bit of a wake-up call to me to realize that we need to get more focused on these issues quicker than I had anticipated.
CAVANAUGH: One of the things about the study, and you just touched on it, Lynn, was the idea that when the price of water goes up, the – it’s easier to achieve the goals of conservation because people tend to use less water. Now, and of course we’ve seen that when it comes to gas as well. When the price of gas goes up, the consumption level goes down. But, you know, on a wide basis, when you’re talking about society, there’s a major difference between water and gas. You can live your life without gasoline, you can’t live your life without water. So does, really, the pricing, doesn’t that have an ethical component to it? That we can’t just look at pricing as a way towards conservation but we also have to have people be able to maintain a water supply? That we don’t price them out of our – out of their needs?
DR. REASER: Well, certainly, the price of water will affect behavior. As Marion suggested, landscaping is the biggest user of water for households.
DR. REASER: And if the price of water goes much higher, you probably will not have as much yard and grass. You may decide to plant more water efficient plants, you may take shorter showers. Does this massively affect your quality of life? As Marion suggested, the Australians have done it and they seem to be doing quite well, thank you. And so I think, in fact, the pricing of water at higher rates does not necessarily lead to a dramatic decline in the quality of life. People – You mentioned gasoline, yes, that probably did affect their quality of life, they maybe liked to drive that big SUV around but a different type of living is not necessarily a downgrade in your quality of life.
CAVANAUGH: And Marion?
PAUL: The Equinox Center did some research on tiered pricing structures for water, to answer your question about the equity issue of we wouldn’t want to price a low income family out of water. And what we found, other areas that have – around the world and in – and actually in the county itself, have put together pricing structures that A, they have to cover the fixed cost of the utility. They, you know, there are pricing costs for the pipes and for the people to do that. After that, you can set a pricing structure so that there’s a water allotment that’s given to each household that’s at a very, very low rate, so it covers what you need to live and cook and take your showers and a moderate amount of landscaping. But then when you increase beyond that and become what some people might call water hogs, then you start to pay the premium. So, yes, it’s very doable and it’s being done across the state. And what’s interesting is that cities that have implemented these pricing structures, they have realized up to 40% reduction just by people making decisions on how they personally would like to reduce their water. Some people love their roses and there’s no need that they would have to give them up if they would rather give something else up.
CAVANAUGH: I understand. Let’s take some calls. Nathan is calling from Ocean Beach. Good morning, Nathan. Welcome to These Days.
NATHAN (Caller, Ocean Beach): Good morning. I love your show. You always discuss the important issues.
CAVANAUGH: Thank you.
NATHAN: I wanted to address your caller’s question about gray water and rainwater harvesting.
NATHAN: And thanks to, I believe, this show and the awareness being raised around the county, San Diego County has lowered its restriction and now by your area, your unincorporated or region of San Diego, whoever you go to for your construction permit is issuing gray water permits and even easier is rainwater collection, which doesn’t require a permit, and that water is very easily stored and used to water your landscapes. And with a simple 1000 square foot roof, you can collect, you know, 600 gallons in just a matter of an hour of a light sprinkle. So…
CAVANAUGH: Nathan, thanks so much. Thank you. Thank you for that information. So it really does depend on the city and the municipality where you live. You can just go and get a permit for it. That’s excellent. Thank you, Nathan. Daniel is calling us from Clairemont. Good morning, Daniel. Welcome to These Days.
DANIEL (Caller, Clairemont): Yes, I wanted the speakers to please address the issue of water use and electrical use and how electricity’s used to move water and how water generates electricity but before that, I’d also like to note that I live in affordable housing. We don’t have things to limit our water, we don’t have the shower things there to slow down the water when we’re using the shower or turn it off when we want to. And also there’s nothing here using gray water. They water and water and water the plants and stuff like that and I like it but I’d much rather have no plants and have water because we are running out of water. Also, I’d like them to address the desalination and how we might be able to go there. I know it’s more expensive but we do need water.
CAVANAUGH: Daniel wants us to talk about a lot. Thank you, Daniel. First of all, his question about electric – electricity and water and how water generates electricity.
DR. REASER: Well, we certainly have now started to look at a lot of alternative sources of energy to reduce our dependence on coal and oil and also, to some extent, natural gas. Hydroelectricity is one avenue but at this point alternative energy seems to be focusing more on, particularly in San Diego, on geothermal and wind and solar and biofuels so I think that hydroelectricity probably is not an option that California will be pursuing just because we do not have the water resources at our disposal.
CAVANAUGH: Yeah, to be able to do it. And, Marion, Daniel lives in a place where they don’t have low flow showerheads or low flow toilets and they water a lot and it makes everything nice and green but is there any way that he can sort of lobby for a change in the way that his complex uses water?
PAUL: I think there – if he lives in, did he say…
CAVANAUGH: Affordable housing.
PAUL: Affordable housing. There is a San Diego Housing Commission that he might be able to talk to them and – and I think they would be really – they would welcome this kind of a call because the agencies and the people that are putting together these large, large developments are having huge water bills. So if they have an advocate from the inside, it’s going to be, you know, very beneficial to them. They would save a lot of money on water. I know a lot of green – housing associations that have greenbelts, for example, are switching to plants, and I think it would be a great conversation for him to have.
CAVANAUGH: And before we leave, I want to talk about the next study that Equinox will release this summer. Marion, what’s coming out later in the summer?
PAUL: Well, actually even later this week we’re…
PAUL: …going to be – the first one we’re going to be doing is – It’s called IPR, which stands for Indirect Potable Reuse, and that is what Lynn was talking about earlier, which is advanced treatment of waste water to purify it and make it potable. And this is being done across the country and around the world for decades very successfully. It could be, we are discovering that it definitely could be a very smart and sensible addition to our water portfolio. Another one we’re coming out with in the next few weeks would be desalination, which would speak to the other caller’s question, very specifically, about, yes, it’s an expensive source. It just really depends on what you’re trying to accomplish. It is a drought-proof, very abundant supply. As we all know when we’re walking on the beach, there’s the ocean. The thing to understand about that, of course, is that one plant really only supplies about 8% of the region’s water. So if you wanted – There is no one solution, so a lot of people think desal can solve it. Unfortunately, it can’t. You would need 10 or 12 plants to get the region’s water supplies met. It would be terribly expensive to do that, not the best option.
CAVANAUGH: Well, it sounds like we’re going to be talking about this again but I want to thank you both so much for coming in and speaking to us today. Dr. Lynn Reaser and Marion Paul, thank you.
PAUL: Thank you.
DR. REASER: You’re welcome. Thank you.
CAVANAUGH: There are a lot of people who wanted to join the conversation. We didn’t have time to get them all on the air. Please go online and state your comment or your question, KPBS.org/thesedays. Coming up, a trip back in time to Tijuana’s Satan’s Playground. That’s as These Days continues here on KPBS.