Transcript Slide 1

South Orange Coastal Ocean Desalination
(SOCOD) Project, Ocean Desalination Costs
and Recent Public Opinions
November 2011
Status Update
Karl Seckel, Assistant General Manager
Municipal Water District of Orange County
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Goals of Current Work Tasks
• Conduct studies and evaluations and report to the five
Participating Entities on the prospective nature of developing
an ocean desalination project at Doheny Beach
• Assist the five Participating agencies in understanding and
making decisions regarding the project
• Look for outside funding to take the burden off of the local
agencies
• Use the Pilot Plant work to understand the issues prior to
implementation of the full scale project
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Why Ocean Desalination?
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A local opportunity
Improves SYSTEM and SUPPLY reliability
Cost competitive with imported water
Environmentally friendly concept
At this location, many factors support the project:
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Right geology
Existing Land
Ability to use a subsurface intake
Integration of the water into the existing system is easy
Need for reliability improvement is there
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South Orange
Coastal Ocean
Desalination
Project
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15 million gallons per day
meets about 25% of the
2025 water demands for:
1. Laguna Beach
2. San Clemente
3. San Juan Capistrano
4. Moulton Niguel WD
5. South Coast WD
All five agencies can
physically receive the
water into their systems
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South Orange
Coastal Ocean
Desalination
Project
Concept Project
Layout
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Test Slant Well Schematic
Ocean Surface
23o
Main Aquifer
40 to 130 feet ±
Infiltration
Test Slant Well
325 feet
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Slant Well TDS* and Total Iron
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Groundwater Fingerprinting and Age Dating
Land Surface
Slant Well
Monitoring
Well
Infiltration
Radium Isotopes
224Ra
= 3.66 days
= 11.4 days
228Ra = 5.75 yrs
226Ra = 1600 yrs
223Ra
“young-midage”
brackish groundwater
Intermediate 14Fresh
Water
Carbon, Low Tritium
& Ra isotopes
Salt
Water
High 14-Carbon & Tritium,
Intermediate Ra isotopes
“old” marine
groundwater
Low 14-Carbon, Tritium
Absent, High Ra isotopes
View of Slant Well and Test Facility Site
Doheny State Beach
Mobile Test Facility
Test Slant Well
and Temp Outfall
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Reverse Osmosis Pilot Test System
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Corrosion and Microbial Flow Test Apparatus
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What is the Cost of Ocean Desalination?
• Many factors to consider
• Ocean Desalination has been done all over the
world
• US Examples include Tampa Bay which is up and
operating
• Also includes Carlsbad which hopes to go into
construction very soon
• Grant Funding or Subsidies
– MET = $250 per AF
– State Grant or Loan Interest Loans (2.6%)
– Feds
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$5,000
South Orange Coastal Ocean Desalination Project
Project Cost vs Projected Imported Water Cost
$4,500
Avoided Imported Water Cost
(MET T1 + Capacity Charge + RTS)
2017
Net Project Cost
Capital at $215M
$1830/AF
-$250/AF
$1580/AF
$4,000
$3,500
$3,000
With Fe/Mn
Pretreatment
2026
$2,000
2022
2017
$2,500
No Fe/Mn Pretreatment
$1,500
$1,000
Iron/Manganese (Fe/Mn) Pretreatment cost at $46M.
Base cost of $190M escalated at mid-point of construction =
$215M. MET, MWDOC and SDGE projected rates. Inflation after
2020 at 5% and Bond interest at 5% in 2016.
$500
$0
2010
2015
2020
2025
2030
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2035
2040
2045
2050
Impacts to Retail Water Costs
• Estimated at $6 dollars per month per household assuming
the agency receives 25% of its water from the plant
• Decisions regarding the project are not expected soley on unit
cost comparisons between ocean desal water and imported
water
• The value of reliability provides a large benefit
• We are now testing an economic and financial model to
better understand the cost impacts and potential offsets for
the project.
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Example 1 - High Cost Low MET Rates
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Example 2 - Low Cost High MET Rates
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Ocean Desalination Costs Around the World ($/AF)
4000
3500
3000
2500
2000
1500
1000
500
0
Courtesy of Water Desalination Report; Presented at the Texas Innovative Water Workshop, San
Antonio, Texas, October 11, 2010
Major Cost Components for an Ocean
Desalination Project
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The RO Treatment Plant
Pre-treatment (if necessary)
Intake System
Brine Disposal System
System Integration for the product water (pump
stations, pipelines and reservoirs)
• Power costs
Major Cost Factors for Australian Plants
Compared to SOCOD Project
Major Factors Driving Unit Costs Higher
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Long and costly new intakes (shafts, tunnels, risers)
Long and costly new brine disposal pressurized lines
Long and costly integration – long lines and high lifts
Renewable energy projects
Alliance Delivery, Rushed Projects
Major Factors Driving Unit Costs Lower
• Economies of scale (large plants)
• Less stringent product water quality (boron, bromide)
Net Effect = Much Higher Unit Costs than SOCOD
Other Key Factors Affecting Costs
• Plant Size – Bigger is Better
• Source Water Quality - TDS, Temperature, Solids, Silt and
Organics Content.
• Product Water Quality – TDS, Boron, Bromides, Disinfection
Compatibility.
• Concentrate Disposal Method;
• Power Supply & Unit Power Costs;
• Project Delivery Method & Financing;
• Other Factors:
 Intake and Discharge System Type;
 Pretreatment & RO System Design;
 Plant Capacity Availability Target.
Key Reasons for Cost Disparity Between
High-End & Low-end Cost Projects
• Desalination Site Location
– Costly Plants Have Overly Long Product Water Delivery Pipelines
• 120 MGD Melbourne Plant – Cost of Plant/Delivery + Power Supply Systems =
US$1.7 BB/1.1 BB (50 miles)
• 66 MGD Sydney SWRO Plant – Cost of Plant/Delivery System
= US$560 MM/US$490 MM (10 miles of underground tunnel under Botany Bay).
• Environmental Considerations
– Complex Intakes & Diffuser Systems
• Phasing Strategy
– Intake and Discharge System Capacity;
– Pretreatment & RO System Design;
• Labor Market Pressures
• Method of Project Delivery & Risk Allocation
Be Careful When Comparing Costs!
• Projects Differ By:
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Source Water Salinity and Temperature;
Product Water Quality;
Unit Cost of Construction, Labor and Permitting;
Cost of Capital;
Unit Cost of Power;
Source of Equipment Supply;
Project Completion Schedule.
• Projects Have to Be Normalized for These and Other Factors
for Accurate Comparison.
Lewis Consulting
Public Opinion Survey
October 2011
MWDOC Service Area
500 Orange County Registered Voters
Considering only the utilities that you pay for, which
would you say is the best value for the amount of
money you pay?
0%
11%
cable satellite TV
3%
Water
Sewer
22%
7%
Landline Telephone
Cellular/Wireless Telephone
8%
Gas
4%
9%
6%
2%
Electric
Trash Collection
Internet access
Other
27%
Don't know/not sure
During the past year, would you say your household's
water usage has been increasing, staying the same or
decreasing?
0%
20%
15%
Increasing
About the same
Decreasing
63%
Don't know/Not
sure
What was the primary motivation for you to
cut back on water usage?
Saving Money
3%
Water agency notices to conserve
water
11%
7%
Messages from the media
14%
20%
Right thing to do/just to
conserve/good for the environment
Rising water rates
4%
Cooler/wetter weather
6%
2%
Fewer people in Household/
Child(ren) moving out
Other
33%
Don't know/not sure
Do you believe the cost of water is expensive, fair or
reasonable, or inexpensive?
6%
Expensive
6%
28%
Fair/reasonable
Inexpensive
60%
Don’t know/Not
sure
San Diego’s Opinion about Cost of Water
55%
40%
30%
20%
10%
40%
Fair/Reasonable
50%
Too Expensive
60%
Inexpensive
5%
0%
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Which of the following 7 options do you believe
would be most effective in solving water shortages?
3%
7%
8%
Ocean desalination
6%
39%
Be more efficient with
water
Use recycled water
Increase storage
29%
Raise water rates
Import more water
30%
53%
Permanent water
restrictions
Don't know/not sure
When thinking about increasing Orange County's
water supply, do you think Ocean Desalination is a
good idea or a bad idea?
Good Idea
18%
Bad Idea
18%
63%
Don't know/ not
sure
Most Critical Thing that Can be Done to Ensure Safe and
Reliable Water Supply for San Diego County
13%
18%
27%
Desalination
24%
10%
13%
Mandatory
Conservation
17%
Voluntary
Conservation
11%
13%
Conservation
2005
13%
15%
4%
Recycled Water
9%
2006
4%
12%
Reservoirs/Storage/W
ells
8%
6%
Import More Water
9%
2009
11%
9%
9%
2011
10%
10%
9%
Improve Quality
13%
11%
0%
5%
10%
15%
20%
25%
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30%
If the election were held today, would you vote yes or
no on the $11.4 Billion, Safe, Clean and Reliable
Drinking Water Supply Act of 2012?
Yes
26%
37%
No
Undecided/Don’t know
37%
Would you consider voting yes if the amount of
the bond was lower?
9%
Yes
28%
No
63%
Undecided/Don’t know
Questions?
Thank you!
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