Southern California water giant wants Sacramento Valley water — and has $44 million to spend
With California in the throes of a second year of drought conditions, the mega-water agency of Southern California served notice Tuesday that it’s prepared to spend up to $44 million to buy water from Northern California to shore up its supplies.
The board of the Metropolitan Water District of Southern California, which serves 19 million urban residents, authorized its staff to begin negotiating deals with water agencies north of the Sacramento-San Joaquin Delta, where supplies are generally more plentiful.
Metropolitan’s move underscores the severity of the state’s deepening water troubles. Although Metropolitan has said its water supplies are generally in good shape, the agency said it doesn’t want to get caught short if the drought conditions persist.
Jeff Kightlinger, the agency’s general manager, said the decision to wade into the market is “a hedge in case next year, or the year after that, is dry.”
The State Water Project, a major source for Southern California, is telling its customers to expect just 5% of their contracted allocations. “Five percent — that’s pretty damn low,” Kightlinger said.
At the same time, Metropolitan’s move could raise the specter of a “water grab,” given Southern California’s voracious thirst for water; the big agency has purchased water from north-of-Delta agencies in the past. The big agency is looking for one-year water transfers totaling up to 65,000 acre-feet of water. An acre-foot is 326,000 gallons, enough for a year’s worth of use for one to two California households.
Metropolitan is offering sellers up to $675 an acre-foot, or two to three times what water transfers cost in ordinary times. During the last drought, prices on the open market soared past $1,000.
Kightlinger said he doubts Metropolitan will purchase the full 65,000 acre-feet authorized by its board, in part because the Northern California water agencies don’t have a lot of water available to sell.
The board voted hours after Gov. Gavin Newsom, standing near an emptier-than-usual Lake Oroville to sign a bill on wildfire safety, acknowledged that the state is in “the second year of these new drought conditions.” He said he spoke with U.S. Interior Secretary Deb Haaland about water supplies Monday, and his administration is closely watching the situation.
Two weeks ago, the State Water Project reduced its expected water deliveries for 2021 to just 5% and the Bureau of Reclamation, which runs the federal Central Valley Project, said it couldn’t guarantee that its south-of-Delta members will receive the 5% allocation they’d been promised earlier in the year. The twin announcements, made the same day, hammered home the seriousness of California’s water woes.
At the time, Metroplitan announced that it had stored enough water in its reservoirs to navigate this year. But Tuesday’s board vote made clear the agency is trying to cushion itself against future shortages.
“Participating in the transfer market this year would allow Metropolitan to preserve some water stored in surface water reservoirs ... for next year, should the critically dry pattern continue into 2022,” a staff report said. “This would provide additional security.”
Among the possible sellers is the Yuba Water Agency, which has been doing business with Metropolitan since 2007, according to the staff report.
The Yuba agency’s general manager, Willie Whittlesey, said sales to Metropolitan proceed as part of a larger agreement with the Department of Water Resources to provide water to salmon habitats and south-of-Delta water agencies. “We absolutely get paid for it,” he said. “We don’t see it as a water grab.”
This story was originally published April 13, 2021 at 3:24 PM.