Climate Change Impacts on California's Water Supply Require MWD to Prioritize Differently

How has California’s four-year drought affected the priorities of the Metropolitan Water District?

Jeff Kightlinger: It’s affected our priorities in a couple ways. One is that while we typically plan for 25 years out, the severity of this drought has had us scrambling to deal with the current situation on the ground.

This was the most severe drought in California’s recorded history, and it’s been a challenge just to make things work month-to-month these past four years. This drought has also been a little different than past droughts, in that there haven’t been other sources of water available for us to purchase.

In the past, we’ve been able to reach out to the agricultural community and do spot-market transfers to move water around the state as needed. This time around, not only was there very limited water availability around the state, but we also faced restrictions on our ability to move water—for instance, restrictions in the Delta made it harder to move water from Northern to Southern California. As a result, the spot-market transfer essentially vanished.

In essence, there was no water available to purchase in the state during this drought. That challenge has forced us to rethink how water markets can operate during severe droughts, particularly when endangered species restrictions and outdated infrastructure limit our flexibility.

We last interviewed you in April, in an exchange titled MWD Adopts Share-the-Pain Approach to Drought. Today, with few water transfers taking place in California, share MWD’s current drought allocation plan.

A decade ago, as this drought was beginning to develop, MWD adopted an internal plan for allocating water in Southern California.

Our approach attempts to be as fair as possible. We wanted the physical realities and the fiscal impacts of the drought to be as similar as possible across Southern California. We didn’t want residents in San Diego to have a vastly different situation than residents of Orange County or Los Angeles.

But physically, their situations are very different. Some places have local groundwater supplies; some have access to other sources of water. We took local supply, access points, and historic levels of demand into account when determining conservation goals, so that every area would feel roughly the same amount of pain.

That’s a very complex process. It requires close interaction among all the water utilities throughout Southern California, which eventually gets coordinated through Metropolitan. We think the share-the-pain approach is the fairest, most equitable way to do it, but it’s certainly a lot more work than just cutting everybody’s water deliveries at a flat amount and leaving it at that.

Our second important action was to hugely expand our conservation rebate program. When we realized that there wasn’t water available for purchase, we thought that if we couldn’t get more supply, we could at least use that money to drive down demand. So, we took all the money that we would have used to buy water, and made it available for conservation programs.

We ended up with the biggest conservation rebate program in the history of the country: roughly $450 million in a two-year period. Of that, about $350 million went to turf rebates, and about $100 million went to water-efficient appliances or devices for the home. The money was all spent. It was a very successful, wildly popular program, and it really did help drive down demand.

To evaluate MWD’s “share-the-pain” approach, it would perhaps be helpful for our readers to know who sits on your board—a board that oversees water policy for 19 million Californians.

We have a 38-member board that represents 26 member agencies: 14 cities, 11 water districts, and one county water authority.

Each of those 26 agencies is represented on our board by at least one director, and larger agencies that represent larger service areas get more. The city of Los Angeles, for instance, has five directors on our board. San Diego County and Orange County each have four directors.

More than half of our board members are elected in their own right, whether to a city council or a water district, and their member agencies then appoint them to Metropolitan, where they serve at the pleasure of their appointing agency.

How is the size of a member agency’s delegation determined?

Agencies are entitled to one director for every 5-percent assessed valuation in the region.

Every year, we get notice from the County Registrar of the assessed valuation of the six counties that we serve, and we adjust the agencies’ weighted vote accordingly, and occasionally adjust their membership.

For instance, until recently, the city of Los Angeles represented 19 percent of the entire region’s assessed valuation, and therefore had four members. In last year’s valuation, their valuation went up to 20.1 percent, and they picked up a fifth director. Our board then grew from 37 directors to 38. 

Let’s address demand: Elaborate on MWD’s ongoing initiatives, in collaboration with local jurisdictions, to incent reduced water demand.

During the drought, we really wanted to jolt the system. The public was very engaged in this drought. They watched the news; they understood the historic implications. That was a big opportunity for us.

Normally, we fund rebate and subsidy programs until they’re out of money, at which point we tell people to come back next year. But this year, we had unprecedented demand. The response was bigger than we’ve ever seen. And our tracking is showing that demand is still robust.

While a $450-million investment is not sustainable, we are going to continue to invest heavily into conservation. Our typical annual budget for rebates was $20 million; for our next two-year budget, the board appropriated $100 million, or $50 million a year.

Let’s turn now to supply management. In addition to being Southern California’s water wholesaler, MWD is also a Western States’ stakeholder. Address MWD’s obligations and interests with regard to its neighboring states abutting the Colorado River.

The lifeblood of the American Southwest is the Colorado River. We share the river with seven western states, the nation of Mexico, and 10 Indian tribes. It sustains a huge number of people and resources, and a major portion of the national economy.

Metropolitan has always played a large role in managing the river. In the 1930s, we built the Colorado River Aqueduct and funded the building of Parker Dam, and Southern California significantly underwrote the funding of Hoover Dam.

The Colorado River has been in drought for the last 16 years. Long-term drought and climate change are having severe impacts to the river’s supply. We’re all going to have to reduce our annual demands on the Colorado River, and that entails working together to find ways to store water and live more within our means.

California, Nevada, and Arizona—which make up the river’s Lower Basin—are working on drought contingency plans. We’re hoping to develop cooperative inter-state programs that will help each state mitigate and cope with the effects of the drought.

How do Mexico’s water concerns mesh or conflict with those of California, Arizona, Nevada and Indian Nations?

Mexico is one of our partners on the Colorado River, and has a role and a responsibility in reducing demand and managing the drought as well.

Five years ago, the United States and Mexico agreed to a historic amendment, or “minute,” to the treaty regulating Colorado River deliveries. It’s termed Minute 319, and it was a major milestone.

Mexico agreed to reduce its take during Colorado River shortages. The United States agreed to let Mexico bank water in Lake Mead and withdraw it during times of drought. We also agreed to fund water conservation programs in Mexico, and Mexico would return some of that conserved water to us.

All those programs came together and worked very well, creating a very good example of international and inter-state cooperation. The goal now is to make it a longer-term arrangement. Our hope is to extend it before the Obama administration leaves—that is, by the end of 2016. 

It was announced earlier this year that former US Interior Secretary and Arizona Governor Bruce Babbitt was brought in by Governor Brown to facilitate interstate and border conversations related to Colorado River water. Can you elaborate on his role?

Secretary Babbitt was brought on by the Brown administration, where his primary role has been advising the governor on the challenges facing the Delta and the California Water Fix plan. Given his great experience as Secretary of the Interior, he has been able to help address some of the thornier, longer-term issues around application of the Endangered Species Act.

As a former governor of Arizona, he’s also no stranger to the Colorado River. He’s well aware that what happens on the Colorado River plays out very strongly in terms of what can be done on the Delta, and in California. All these issues are interconnected, as is our water security and reliability in the American Southwest. 

MWD recently purchased, with court approval, five islands in the heart of the Sacramento-San Joaquin Delta. Speak to the significance of this purchase for Southern California’s future water supply.

Metropolitan recently purchased 20,000 acres in the California Bay Delta area, scattered across five islands that are currently being used primarily for farming and grazing. Our goal is to explore how this land could potentially be used as fish and avian habitats, which would give us credits and help us better manage the Delta ecosystem.

One reason we’re having so many problems moving water north to south in California is because of endangered species challenges. A major driver of those challenges is that there simply isn’t enough habitat left.

Once upon a time, the Delta was all marsh habitat. Now, less than 5 percent marsh habitat is left. Not surprisingly, species that like that habitat—particularly native species—have suffered. The surest way to help is to create better places to live and more food supply for these species.

These 20,000 acres came on the market, and we saw some good habitat opportunities on them, so we went ahead and purchased them. We got challenged in court, but the courts okayed us to close that purchase. We now own those islands. 

Jeff, what can our readers expect in the next year in the way of meaningful progress on addressing California’s drought in an environmentally conscious way?

Drought is a way of life in California, and it’s no stranger to water agencies. We expect droughts. We know we get them; they come in cycles. This time, we’ve been through a particularly severe cycle.

But what’s particularly worrisome is this: In our business, we tend to look at the past as a predictor of the future, and that may become impossible as a result of climate change.

Climate change is very real, and we believe we are already seeing the impacts on our water supply. For instance, we’re now getting more rain and less snow. That alone can change everything from when water is available, to how we have to move it, to the best infrastructure for the job.

Droughts may be a fact of life, but they’re likely to get more severe, deeper, and longer with climate change. That means we’re going to have to look at fundamentally different ways to run our business. We’re going to have to get more locally self-reliant. We’re going to have to use less and conserve more. But we’re also going to need to revisit whether our current infrastructure is robust enough.

The state has really not invested in its backbone infrastructure since the 1960s. Most of the State Water Project was built between 1960 and the early 1970s, and California hasn’t built a major reservoir since then. Metropolitan has; the Bay Area has—but the state has not.

Back then, California had a population of roughly 12 million people. We’re at 38 million people now. And by all accounts, we’re expected to reach 50 million in the next 25 years. We can’t keep increasing the population burden on our infrastructure that was built by our grandparents, without upgrading or expanding it, and expect it to function well going forward.

California needs to take a hard look at its infrastructure investments. The state needs to keep up with what local areas are doing to conserve water and be more efficient. But it also needs to upgrade and expand our supply infrastructure as we continue to grow. 

This past January, VerdeXchange 2016 hosted a charrette on water self-reliance and infrastructure investment that included, by invitation, participants from the county, the city, MWD, and leading engineering firms. If that group were to convene again this coming January at VerdeXchange 2017, what should be on their agenda in the way of priority projects?

There always have to be two areas of investment in water, and they have to work together.

We need more local water. We need to recycle more, we need to continue to push on demand management, and we need to continue to clean up our contaminated groundwater basins so that they can used to store water going forward.

We need to focus on all those local issues. But as a state, we need to look at the big backbone issues, too. We have to look both inward and outward at the same time.

As a state, we have to look at our water storage capacity. We’ve more than doubled our population, but haven’t expanded our reservoir capacity. The governor’s California Water Plan would add two major reservoirs and expand groundwater storage. That’s essential as we grow.

We also have to find ways to move water safely and minimize environmental impacts. The governor has a plan for a Delta conveyance system that would be protected from both climate change and seismic challenges, while being safer for fish and better for the environment.

There’s a lot of opposition, but the governor is pushing forward—knowing that unless we modernize our infrastructure, we’re going to face severe challenges as a state. 

Lastly, having confirmed your participation once again at VerdeXchange 2017 in January, what do you expect to report on re water reliability and supply?

There are certain historic milestones in water that only become possible once every generation or so. 2016 has the potential to be the year we reach some of those milestones.

By January, we should have closure on the environmental review process on the governor’s California Water Fix plan. My hope is that the project will be approved, and that both the Obama and Brown administrations will be ready to move forward. California has been working toward this goal for decades.

I also hope to see agreement on a drought-sharing plan throughout the Lower Basin on the impacts of drought contingencies on the Colorado River. That would require California, Arizona, and Nevada all to agree on a plan.

The third area where we can make progress is on extending the agreement between Mexico and the United States, which would expand on inter-state and international cooperation.  

And finally, momentum is building on developing a long-term plan for the Salton Sea. That would address what has been a very challenging environmental issue in that part of California. If all those pieces come together by the end of 2016, it will have been quite a momentous year in water.