Evaluation of Seawater Desalination Projects by SPI November 2012

Prepared For:
Mont er ey Peni nsul a Regi onal Wat er Aut hor i t y

Evaluation of Seawater Desalination
Projects

November 2012 DRAFT REPORT
Preparedby:
SeparationProcesses,Inc.
3156LionsheadAve
Suite2
Carlsbad,CA92010
7604003660 MPRWA TAC Meeting, 11/13/2012 , tem No. 1., tem Page 1, Packet Page 1
MPRWA TAC Meeting, 11/13/2012 , tem No. 1., tem Page 2, Packet Page 2
MONTEREY PENINSULA REGIONAL WATER AUTHORITY TABLE OF CONTENTS
Page i

CONTENTS

EXECUTIVESUMMARY.......................................................................................................................................1
PROJECTSUMMARIES...............................................................................................................................................1
PROJECTFUNCTION..................................................................................................................................................2
PROJECTPERFORMANCE..........................................................................................................................................4
ECONOMICS..............................................................................................................................................................5
IMPLEMENTATIONCONSIDERATIONS......................................................................................................................7
1 INTRODUCTION......................................................................................................................................11
2 PROJECTSUMMARIES............................................................................................................................21
2.1 CALIFORNIAAMERICANWATER(CALAM)............................................................................................................22
2.2 DEEPWATERDESAL(DWD)..............................................................................................................................24
2.3 PEOPLESMOSSLANDING(PML).........................................................................................................................26
3 PROJECTFUNCTION...............................................................................................................................31
3.1.1 ProjectPurpose..................................................................................................................................31
3.1.2 CustomersIdentified..........................................................................................................................31
3.1.3 AdequacyofTreatmentApproach.....................................................................................................31
3.1.4 ResidualsHandling.............................................................................................................................34
3.1.5 FeedWaterCharacterization.............................................................................................................34
3.1.6 QualityofProjectInformation...........................................................................................................34
3.1.7 OmissionsorFatalFlaws...................................................................................................................35
3.2.1 ProjectPurpose..................................................................................................................................35
3.2.4 ResidualsHandling.............................................................................................................................38
3.2.5 FeedWaterCharacterization.............................................................................................................38
3.2.6 QualityofProjectInformation...........................................................................................................38
3.2.7 OmissionsorFatalFlaws...................................................................................................................39
3.3 PEOPLESMOSSLANDING(PML)........................................................................................................................39
3.3.1 ProjectPurpose..................................................................................................................................39
3.3.4 ResidualsHandling...........................................................................................................................311
3.3.5 FeedWaterCharacterization...........................................................................................................312
3.3.6 QualityofProjectInformation.........................................................................................................312
3.3.7 OmissionsorFatalFlaws.................................................................................................................312
4 PROJECTEDPERFORMANCE....................................................................................................................41
4.1.1 PlantDesignCapacity........................................................................................................................41
4.1.2 TargetedProductWaterQuality........................................................................................................42
INTRODUCTION MONTEREY PENINSULA REGIONAL WATER AUTHORITY

Page ii
4.1.3 DisinfectionStrategy..........................................................................................................................43
5 ECONOMICS...........................................................................................................................................51
5.1 CALIFORNIAAMERICANWATER(CALAM)...........................................................................................................55
6 IMPLEMENTATIONCONSIDERATIONS.....................................................................................................61
6.3.1 AssessmentofImpactsofSeawaterIntake.......................................................................................67
6.3.2 BrineDischarge..................................................................................................................................68
7 REFERENCES...........................................................................................................................................71

LIST OF TABLES
TABLEES1SUMMARYOFPROPOSEDPRODUCTWATERQUALITY.......................................................................................ES4
TABLEES2SUMMARYOFEVALUATEDCAPITALANDOPERATINGCOSTESTIMATES..................................................................ES6
TABLE41SUMMARYOFPROJECTEDPRODUCTQUALITYFROMCALAMFACILITY...................................................................43
TABLE42SUMMARYOFPROJECTEDPATHOGENCREDITSFORCALAMPROJECT....................................................................43
TABLE43SUMMARYOFPROJECTEDPRODUCTQUALITYFROMDWDFACILITY......................................................................44
TABLE44SUMMARYOFPROJECTEDPATHOGENCREDITSFORDWDPROJECT........................................................................45
TABLE45SUMMARYOFPROJECTEDPRODUCTQUALITYFROMPMLFACILITY
1
......................................................................46
TABLE46SUMMARYOFPROJECTEDPATHOGENCREDITSFORPMLPROJECT.........................................................................46
TABLE51SUMMARYOFCHEMICALUNITPRICES..............................................................................................................52
TABLE52SUMMARYOFEVALUATEDCAPITALANDOPERATINGCOSTESTIMATES....................................................................54
TABLE53SUMMARYOFCALAMCAPITALCOSTEVALUATION.............................................................................................55
TABLE54SUMMARYOFCALAMO&MCOSTEVALUATION...............................................................................................56
TABLE55SUMMARYOFDWDCAPITALCOSTEVALUATION................................................................................................57
TABLE56SUMMARYOFDWDO&MCOSTEVALUATION..................................................................................................58
TABLE57SUMMARYOFPMLCAPITALCOSTEVALUATION.................................................................................................59
TABLE58SUMMARYOFPMLO&MCOSTEVALUATION.................................................................................................510

LIST OF FIGURES

FIGUREES1PROJECTEDCALAMPROJECTIMPLEMENTATIONSCHEDULE.............................................................................ES7
FIGUREES2PROJECTEDDWDPROJECTIMPLEMENTATIONSCHEDULE................................................................................ES8
FIGUREES3PROJECTEDPMLPROJECTIMPLEMENTATIONSCHEDULE..................................................................................ES8
FIGURE21CALAMPROJECTLOCATIONMAP..................................................................................................................23
MONTEREY PENINSULA REGIONAL WATER AUTHORITY TABLE OF CONTENTS
Page iii
FIGURE22DWDPROJECTLOCATIONMAP.....................................................................................................................25
FIGURE23PMLPROJECTLOCATIONMAP......................................................................................................................27
FIGURE61CONCEPTUALIMPLEMENTATIONSCHEDULEFORTHECALAMPROJECT..................................................................65
FIGURE62CONCEPTUALIMPLEMENTATIONSCHEDULEFORTHEDWDPROJECT.....................................................................66
FIGURE63CONCEPTUALIMPLEMENTATIONSCHEDULEFORTHEPMLPROJECT.........................................................................68

ABBREVIATIONS AND ACRONYMS
AACE Association for the Advancement of Cost Engineering
AF Acre-Foot
AFY Acre-Feet/Year
ASR Aquifer Storage and Recovery
Cal-Am California American Water
CDPH California Department of Public Health
CEQA California Environmental Quality Act
CPCN - Certificate of Public Convenience and Necessity
CPUC California Public Utilities Commission
Crypto - Cryptosporidium
CSIP Castroville Seawater Intrusion Project
DWD DeepWater Desal
EA Environmental Assessment
EIR Environmental Impact Report
EIS Environmental Impact Statement
EPA U.S. Environmental Protection Agency
ERD Energy Recovery Device
fps feet per second
FPVC Fusible Polyvinyl Chloride\
gfd Gallons per Day per Square Foot
GWR Groundwater Replenishment
HDPE High Density Polyethylene
KHC Kris Helm Consulting
lb - pound
LF Lineal Foot
MCL Maximum Contaminant Level

Page iv
MPRWA Monterey Peninsula Regional Water Authority
MRWPCA Monterey Regional Water Pollution Control Agency
mgd Million Gallons per Day
MF Microfiltration
MG Million Gallons
MLCP Moss Landing Commercial Park
MLPP Moss Landing Power Plant
MPWSP Monterey Peninsula Water Supply Project
NEPA National Environmental Policy Act
NOD Notice of Determination
NOI Notice of Intent
NOAA National Oceanic and Atmospheric Administration
NPDES National Pollutant Discharge Elimination System
O&M Operations and Maintenance
PG&E Pacific Gas and Electric
PML Peoples Moss Landing
RO Reverse Osmosis
SCADA Supervisory Control and Data Acquisition
SDI Silt Density Index
SPI Separation Processes Inc.
SVGB Salinas Valley Groundwater Basin
SWRCB State Water Resources Control Board
SWTR Surface Water Treatment Rule
TAC Technical Advisory Committee
TBD To Be Determined
TDS Total Dissolved Solids
TOC Total Organic Carbon
UF - Ultrafiltration
UV Ultra Violet Light
MONTEREY PENINSULA REGIONAL WATER AUTHORITY EXECUTIVE SUMMARY
Page ES-1
EXECUTIVE SUMMARY
Separation Processes Inc. (SPI) in association with Kris Helm Consulting (KHC) is providing
engineering and consulting support to the Monterey Peninsula Regional Water Authority
(MPWRA) to assist with the evaluation of three candidate desalination projects on the Monterey
Peninsula. This report presents the results of our evaluation of the projects, targeted at replacing
supplies currently extracted from the Carmel River but subject to a 1995 order from the State
Water Resources Control board to secure an alternate source of supply by December, 2016.
The proposed strategy for meeting the projected annual demand within the California American
Water service area of 15,250 acre-feet is a multi-pronged approach including permitted
extractions from the Carmel River and Seaside Basin, an aquifer-storage and recovery system,
and the existing Sand City desalination plant--totaling 6,250 acre-feet; leaving a 9,000 acre-feet
gap in supply. Two alternatives are under consideration to compose this final supplya 9,000
acre-feet production seawater desalination plant; or a 5,500 acre-feet seawater desalination plant
in concert with a groundwater water replenishment project using advanced treated recycled water
of 3,500 acre-feet.
This report presents the results of our evaluation of three candidate alternatives for the seawater
desalination component of the overall water supply portfolio. California American Water is
actively engaged with the California Public Utilities Commission to build a facility and secure
the required supply. Two other development groups have proposed alternative projects for
considerationDeepWater Desal, LLC and the Peoples Moss Landing Water Desal Project.
The three projects were analyzed on functional, performance, economic and implementation
grounds in an effort to provide a balanced evaluation for consideration by the MPRWA.

PROJECT SUMMARIES
The three projects are in the conceptual or preliminary stage of development and all three have as
their objective to provide California American Water the seawater desal component of the
required replacement water supply under State Water Resources Control Board Order No. 95-10.
The DeepWater Desal group proposes to provide an expandable plant capable of serving
additional regional water needs as well, outside of the California American Water service area.
Brief summaries of the projects follow:
Project Name Monterey Peninsula Water Supply Project
(MPWSP)
Proponent(s) California American Water (Cal-Am)
Location 46-acre site of vacant, disturbed land west of the
MRWPCA Regional Treatment Plant (RTP).
Purpose To supply supplemental desal component of the
Monterey Peninsula regional water supply
This project is currently under consideration by the
California Public Utilities Commission (CPUC).
Production Volume 5.4 mgd or 9.0 mgd


Page ES-2
Project Name DeepWater Desal (DWD)
Proponent(s) DeepWater Desal, LLC, Dynegy Moss Landing
Power Plant, MFJK Partnership of the Capurro
Ranch, PV2 Solar, and Ecomert Technologies
Location Capurro Ranch Property, north of /Elkhorn Slough
Purpose Phase 1 to supply supplemental desal component of
the Monterey Peninsula regional water supply
Phase 2 to supply northern customers
Production Volume Phase 1: 4.9 mgd or 9.1 mgd
Phase 2: 22.0 mgd

Project Name The Peoples Moss Landing Water Desal Project
(PML)
Proponent(s) DeSal America, LLC composed of Moss Landing
Commercial Park, LLC; and Stanley and Patricia-
Vance Lueck
Location Moss Landing Commercial Park
This project is currently proposed as alternative to
the Cal-Am MPWSP.

PROJECT FUNCTION
We evaluated the function of each project in terms of project purpose, customers identified,
adequacy of treatment approach, residuals handling, feed water characterization, quality of
project information, and any omissions or fatal flaws in the information provided. The
evaluation was conducted based on information provided in response to a 56-item questionnaire
prepared by the MPRWA technical advisory committee and submitted by each proponent; along
with additional information each provided in response to specific questions and interviews from
SPI and KHC.
All three projects have available sites for building the required treatment facilities; and credible
seawater intake and brine disposal approaches, though there are substantive differences among
them. Cal-Am proposes to use a group of subsurface slant intake wells (up to eight for the
maximum capacity plant alternative); DWD proposes a new screened open ocean intake installed
at roughly 60-ft of depth; and PML is considering options to use either an existing seawater
intake pump station drawing from the Moss Landing Harbor, or potentially a new screened open
ocean intake installed coincident with an existing 51-in diameter concrete outfall pipeline owned
Page ES-3
by the Moss Landing Commercial Park. Cal-Am has projected there may up to 3 percent of
groundwater from the Salinas Valley Groundwater Basin (SVGB) entrained with their intake
supply that would need to be returned (as facility product water) to the basin. For brine disposal,
Cal-Am and DWD propose to blend concentrated brine from the desal plants with existing
outfall flowsCal-Am blending with the existing Monterey Peninsula Regional Water Pollution
Control Agencys wastewater plant outfall; and DWD using the existing cooling water return
outfall at the Moss Landing Power Plant. Both sources have sufficient dilution and hydraulic
capacities. PML proposes to use their existing 51-in diameter outfall, currently permitted to
discharge magnesium-depleted seawater. There is some evidence of disrepair of the outfall in
terms of pipeline integrity and condition of the existing diffusers which would need to be
addressed along with the permitting of a non-shore diluted brine stream.
Cal-Am and PML propose to serve only the identified demand within the Cal-Am service area at
the two plant capacity increments under consideration; while DWD envisions a higher capacity
regional project, capable of producing up to 25,000 AFY. DWD has not yet secured agreements
with any potential customers.
In terms of treatment approachall three candidate teams propose to use reverse osmosis (RO)
as the primary desalination technology. However, both DWD and PML propose a single pass
RO system; while Cal-Am has proposed a partial double or two pass systemtreating a portion
of the product water from the first pass RO system with a second RO system and blending the
supplies to form the final treated water. The issue relates to the quality of product water
produced, more than treatment function; as either approach is considered functional.
Pre- and post-treatment approaches are similar. All incorporate granular media filtration of the
incoming seawater, with PML following on with a low pressure membrane filtration system
(microfiltration or ultrafiltration) to deal with the anticipated higher solids load from water
extracted from Moss Landing Harbor. In the case of Cal-Am, the aquifer filtration provided by
the slant wells could obviate the need for media filtration; but the potential presence of iron and
manganese in the supply could just as well make them necessaryso the approach is considered
conservative. In the case of DWD, the incoming seawater extracted at depth will be cold
(roughly 15 C) and warmed through a proprietary warming system at the Moss Landing Power
Plant prior to transmission to the treatment plant site. All three proponents propose to use calcite
beds, carbon dioxide and sodium hydroxide for re-mineralization/stabilization of the RO treated
product water and chlorine disinfection.
Cal-Am and DWD will require offsite pipelines for feed, product water and brine disposal; while
PML proposes to use existing intake and outfall pipelines originating on site; requiring only a
product water delivery pipeline. DWDs site location north of the Elkhorn Slough is likely to
entail complex issues with crossings for all three of their large diameter pipelines (one 48-in and
two 36-in).
All three proponents were cooperative with our evaluation and provided all available and
requested information. The Cal-Am project through past work on other regional projects as well
as ongoing procedures with the California Public Utilities Commission has produced the most
detailed information on their project, followed by DWD who have prepared a fair amount of
predesign data on their proposed system along with active environmental investigations for their
proposed intake. PML is at a more preliminary level of engineering and planning in comparison.

Page ES-4
Importantly however, we have not found any fatal flaws associated with any of the candidate
projects.

PROJECT PERFORMANCE
Performance of each proposed system was gauged relative to categories of plant design capacity,
targeted product water quality and disinfection strategy.
For plant capacity, we considered the proposed instantaneous design capacity of each treatment
facility in comparison to the required annual production incrementeither 5,500 AFY or 9,000
AFY. What we found were wide variationswith Cal-Am proposing capacities of 5.4 mgd and
9.0 mgd; DWD of 4.9 mgd and 9.1 mgd; and PML at 4.8 mgd and 9.4 mgd. We considered the
level of equipment redundancy proposed by each team in the context of the amount of online
time it would require a facility at a given rated capacity to deliver the required annual allotment.
For Cal-Am, we gauged their planned design capacities adequate considering the need to return
flow to the SVGB as well as meet the 5,500 AFY or 9,000 AFY into their distribution system.
At capacities of 5.4 mgd and 9.0 mgd, the plant(s) would need to operate 98 percent of the time
to meet productionnot overly conservative but achievable given the level of equipment
redundancy (including spare process units) in their proposed facility. DWD, with similar
proposed levels of redundancy, would have equivalent minimum facility capacity requirements
of 5.0 mgd and 8.2 mgd; somewhat lower than Cal-Am as they lack the requirement to return
flow to the SVGB. PML did not provide a detailed equipment list indicating numbers of process
units; so gauging proposed levels of equipment redundancy was uncertain. However, we feel the
facility should have adequate reliability and conducted our evaluation on that basis
recommending equivalent capacity ratings to DWD of 5.0 mgd and 8.2 mgd.
The product quality produced by the proposed systems would differ based on the configuration
of their proposed RO systems. Cal-Ams proposed partial two-pass system could likely achieve
chloride, boron, and total dissolved solids (TDS) consistent with current Carmel River supplies;
but the single pass systems would not. We consider a lower salinity product supply an asset and
evaluated all three projects (from an economic perspective) as having partial two-pass RO
systems. The recommended product quality goal is summarized in Table ES-1.
Table ES-1 Summary of Proposed Product Water Quality
Parameter Units Value
Total Dissolved Solids mg/L 380
Chloride mg/L 60
Boron mg/L 0.5
pH units 8.0
Calcium mg/L as CaCO3 40
Alkalinity mg/L as CaCO3 40

Page ES-5
For disinfection, the proposed facilities must comply with the Surface Water Treatment Rule and
Long-Term 2 Enhanced Surface Water Treatment Rule. Under these regulations, pathogen
removal/inactivation requirements are set on a logarithmic (log) scale, with the California
Department of Public Health establishing specific log removal for priority pathogens, including
giardia, cryptosporidium (crypto), and virus. The levels set will be based on source water quality
and other factors, and are expected to be in the range of 3-5 for giardia, 2-4 for crypto, and 4-6
for virus, based on each of the project source waters being classified as surface waters or under
the influence of surface waters. We find all three projects are likely to achieve sufficient log
removal credits under their proposed treatment schemes to comply.

ECONOMICS
A primary focus of our evaluation was to provide a balanced, apples to apples comparison of
the candidate projects from an economic perspective. We implemented this by focusing on the
following principles:
Uniformity in plant design capacity for the two non-regional approaches; equivalent
capacity allocation for the proposed DWD regional project.
Equivalency in treatment to achieve: a common RO feed water quality following
pretreatment; a common treated water quality goal; and pathogen removal credits
required for the applicable supply source.
Uniformity in equipment redundancy.
Uniformity in unit cost criteria for common items.
Uniformity in cost factors applied to aggregated costs (e.g., contingencies; electrical
and I&C costs; etc.).
Uniformity in unit costs for chemicals and other consumables for treatment
evaluations.
To implement the above, we adjusted plant capacities for the evaluation on the basis described in
the Project Performance discussion, rating Cal-Ams proposed system at design capacities of 5.4
mgd and 9.0 mgd; and the DWD and PML systems at 5.0 mgd and 8.2 mgd. In terms of
treatment process, we attempted to maintain the overall proposed process design of the
proponents, but did evaluate all as including a partial (40 percent) capacity second pass RO
system. We also assumed N+1 redundancy on all rotating equipment and major treatment
process units (e.g., filters, RO membrane trains). We employed an equivalent basis in
developing our capital equipment cost estimates, relying on targeted quotes for equipment and
SPIs cost information from past, similar seawater RO projects. For indirect costs, we assumed
fixed factors and applied them uniformly to each project.
We implemented a similar strategy on annual operating and maintenance expenses, using
common chemical unit prices along with pricing on common consumables, such as the RO
process membranes. The results of our evaluation are presented in Table ES-2.


Page ES-6
Table ES-2 - Summary of Evaluated Capital and Operating Cost Estimates
Cost Element
Project Proponent
Cal-Am DWD PML
9 kAFY 5.5 kAFY 9 kAFY 5.5 kAFY 9 kAFY 5.5 kAFY
CAPITAL COSTS (in Millions 2012 Dollars)
Intake/Outfall $37.0 $31.7 $2.71 $1.66 $3.00 $3.00
Pretreatment & Residuals Handling $10.6 $7.94 $11.2 $7.94 $20.2 $13.6
Desalination System $22.3 $15.1 $19.4 $13.2 $19.9 $14.0
Post-Treatment $1.48 $0.88 $1.48 $0.88 $1.66 $1.07
Distribution $17.0 $16.0 $29.0 $28.9 $22.4 $22.3
Site Structures $11.5 $10.8 $3.65 $2.52 $10.0 $7.00
Indirect Costs
1
$58.0 $50.8 $54.5 $47.5 $67.9 $62.3
Contingency Allowance (30%) $47.4 $40.0 $36.6 $30.8 $43.6 $37.0
Mitigation Allowance (1%) $1.60 $1.30 $1.20 $1.00 $1.50 $1.20
TOTAL $207 $175 $160 $134 $190 $161
ANNUAL O&M COSTS (in Millions 2012 Dollars)
Energy $5.83 $3.54 $3.93 $2.41 $4.20 $2.56
Chemicals $0.32 $0.19 $0.83 $0.50 $0.93 $0.57
Expendables $0.69 $0.45 $1.02 $0.68 $1.09 $0.65
Other Proponent Expenses -- -- $2.85 $2.60 -- --
O&M Labor $2.69 $2.36 $2.69 $2.36 $2.69 $2.36
Equipment Replacement
2
$1.50 $1.23 $1.01 $0.83 $1.16 $0.92
TOTAL $11.0 $7.77 $12.3 $9.38 $10.1 $7.06
ANNUAL COST OF WATER (in Millions 2012 Dollars)
Capital Recovery
3
$12.0 $10.1 $9.24 $7.77 $11.0 $9.34
Total Annual Cost $23.0 $17.9 $21.5 $17.2 $21.1 $16.4
Production Cost of Water ($/AF) $2,555 $3,250 $2,395 $3,120 $2,345 $2,980
1
Includes implementation costs at 25%; ROW easement and land costs, mobilization/demobilization at 2%; electrical and I&C systems at 18%; engineering
and startup at 15%; and additional project proponent prescribed costs. All percentages applied to plant facilities costs.
2
Calculated as 1.5% of plant facilities costs.
3
Capital recovery factor based on an interest rate of 4.0% and term of 30 years.

Page ES-7
Overall, the final water production costs are fairly equivalent given the overall accuracy of the
estimate and degree of project development. Cal-Ams capital cost is the highest; owing largely
to its high intake system cost. PML is proposing to reuse existing intake infrastructure; while
DWD has an unspecified separate business entity which will be funding its intake, outside of the
assigned DWD facility budget. Cal-Ams operating cost is also relatively high, owing in large
measure to higher stipulated energy costs than either DWD or PMLroughly $0.13/kW-hr vs.
$0.08 kW-hr.

IMPLEMENTATION CONSIDERATIONS
The three projects are at varying states of development in terms of the regulatory permitting
process. Cal-Am is further along than either DWD or PML, though DWD has completed or is
nearing completion of their initial CEQA compliance documents. Forecast project
implementation schedules were identified for each project proponent, based on a select number
of key environmental and permitting tasks, including:
1. A project description must be completed.
2. An Environmental Assessment must be made.
3. An EIR/EIS must be completed (CEQA/NEPA compliance).
4. Commercial Agreements must be negotiated/ Cal-Am must obtain a Certificate of Public
Convenience and Necessity (CPCN), after certification of the EIR.
5. Jurisdictional Permits must be obtained for facilities impacting Waters of the U.S.
6. NPDES Permits must be amended/obtained.
7. Coastal Development Permits must be obtained.
It was further assumed that each proponent had the financial capacity to proceed with predesign
preparation/procurement package development such that the project could be put out to final
design and construction bid coincident with approval of the final project permits. The schedules
are provided below as Figure ES-1, Figure ES-2 and Figure ES-3.

Figure ES-1 Projected Cal-Am Project Implementation Schedule


Page ES-8

Figure ES-2 Projected DWD Project Implementation Schedule

Figure ES-3 Projected PML Project Implementation Schedule

MONTEREY PENINSULA REGIONAL WATER AUTHORITY INTRODUCTION
Page 1-1
1 INTRODUCTION
Separation Processes Inc. (SPI) and Kris Helm Consulting (KHC) are providing engineering and
consulting support to the Monterey Peninsula Regional Water Authority (MPWRA) to assist
with the evaluation of three candidate desalination projects on the Monterey Peninsula. SPI
conducted technical and economic evaluations of the proposed projects; while KHC examined
issues relating to permitting and environmental compliance.
California American Water (Cal-Am) is an investor owned public utility who is responsible for
providing the water supply to cities covered within the MPRWACarmel-by-the-Sea, Del Rey
Oaks, Monterey, Pacific Grove, Sand City and Seaside. The proposed projects would
supplement supply previously extracted for the region from the Carmel River. In 1995, the State
Water Resources Control Board (SWRCB) in its Order No 95-10 found that Cal-Am was
withdrawing water from a subterranean stream, rather than percolating groundwater; and in the
process extracting an average of 10,730 AFY in access of its valid right of 3,376 AFY. The
order required Cal-Am to secure a replacement source of supply by December 2016.
The average annual water demand in the region is 15,250 AFY
1
. Currently identified sources
include established rights to Carmel River and Seaside Basin waters of 4,850 AFY, the aquifer
storage and recovery (ASR) system of 1,300 AFY, and 94 AFY from the Sand City Desalination
Plant. This leaves a roughly 9,000 AFY deficit to be made up. Alternatives include a new 9,000
AFY seawater desalination plant; and a new groundwater replenishment (GWR) project of 3,500
AFY in combination with a new 5,500 AFY seawater desalination plant.
The technical advisory committee (TAC) of the MPRWA developed a list of 56 questions to
submit to the three desalination project proponents, including Cal-Am, DeepWater Desal, LLC
(DWD) and the Peoples Moss Landing Desal (PML). Each proponent is proposing to build a
desalination facility to satisfy the planned desalination component of the regional water supply.
Responses and supporting information were received from each, exhibiting various stages of
development and differences in approach. The differences were such that a deliberative, fair
comparative evaluation could not be conducted solely on the basis of the information provided.
This report presents the results of a more detailed evaluation and analysis conducted by SPI and
KHC. The work was conducted based on information provided in the original responses to the
questions from the TAC along with supplemental information provided by each proponent. The
goal was to provide an apples-to-apples comparison of each project on an equivalent cost
basis; along with an evaluation of the realistic implementation schedule for each, taking into
account environmental and permitting issues.

1
RBF Memorandum, Recommended Capacity for the Monterey Peninsula Water Supply Project (MPWSP)
Desalination Plant, April 20, 2012
MONTEREY PENINSULA REGIONAL WATER AUTHORITY PROJECT SUMMARIES
Page 2-1

2 PROJECT SUMMARIES
The tabular summaries provided in this section include information on each of the proponent
projects, including:

Project name
Proponent(s)
Location
Purpose
Production volume
Key features
Facility map
Key information provided to review team
Persons interviewed/corresponded with
The TAC requested information from each proponent that would satisfy the desalination
component of the proposed water supply. Responses received from the Cal-Am and PML
groups were generally in line with this request; though there were slight differences in the
proposed plant capacities. The DWD response proposed to only serve the higher 9,000 AFY
requirement, along with a planned expansion to act as a regional water supply source to other
agencies on the peninsula as well as cities north of Moss Landing. DWD did reveal in response
to subsequent inquiries how they would serve the 5,500 AFY supply scenario. The information
presented for each project represents their current status from the proponents at the time of this
report writing.

PROJECT SUMMARIES MONTEREY PENINSULA REGIONAL WATER AUTHORITY

Page ES-2-2
2.1 CALIFORNIA AMERICAN WATER (CAL-AM)
Project Name Monterey Peninsula Water Supply Project
(MPWSP)
Proponent(s) California American Water
Location 46-acre site of vacant, disturbed land west of the
MRWPCA Regional Treatment Plant (RTP).
This project is currently under consideration by the
California Public Utilities Commission (CPUC).
Key Features 1. Raw seawater supply through a series of up to
eight sub-surface slant wells located on a vacant
376 acre parcel with roughly 7,000 feet of ocean
shoreline.
2. Raw water and pump to waste transmission
through one of eight candidate alignments.
3. Single-stage, dual media pressure filtration
pretreatment.
4. Partial 2-pass RO desalination treatment with
energy recovery. Final product has a proposed
blend of 60:40 first pass:second pass product.
5. Product stabilization with calcite, carbon dioxide,
and sodium hydroxide.
6. Disinfection with sodium hypochlorite and
temporary UV.
7. 2 x 1.0 MG product storage tanks, product
distribution pumps, and 36-in diameter product
pipeline to Cal-Am distribution system near
Seaside.
8. 24-in brine disposal pipeline to the existing RTP
outfall.
Key Information Provided 1. TAC response package
2. Response to supplemental questions from SPI
and KHC
3. Relevant testimony to the CPUC
4. RBF 2011 memo on implementation schedule
risk of regional supply alternatives
5. RFB 2011 memo on cost analysis of regional
supply alternatives
Persons Interviewed/Corresponded With Richard Svindland

Page 2-3

Figure 2-1 Cal-Am Project Location Map

____ Slant Well
____ Intake
____ Brine
____ Product Water
Desalination Plant
Tie-in to CAL AM
existing facilities

Page ES-2-4
2.2 DEEPWATER DESAL (DWD)
Project Name DeepWater Desal
Proponent(s) DeepWater Desal, LLC, Dynegy Moss Landing
Power Plant, MFJK Partnership of the Capurro
Ranch, PV2 Solar, and Ecomert Technologies
Location Capurro Ranch Property, north of /Elkhorn Slough
Purpose Phase 1 to supply supplemental desal component of
the Monterey Peninsula regional water supply
Phase 2 to supply northern customers
Production Volume Phase 1: 4.9 mgd or 9.1 mgd
Phase 2: 22.0 mgd
Key Features 1. Raw seawater supply through a new 48-in open
intake extending into the Monterey Bay west of
Moss Landing at a depth of roughly 65-ft.
2. Raw water transmission through an existing
right of way maintained by MLPP to an existing
pump station at MLPP for transfer to the site.
3. Proprietary warming system at MLPP which
will increase the temperature of the raw water.
4. Transmission of the warmed feed water through
a new 36-in pipeline to the Capurro Ranch site.
5. Single-stage, dual media pressure filtration
pretreatment.
6. Single-pass RO desalination treatment with
energy recovery.
7. Product stabilization with calcite, carbon
dioxide, and corrosion inhibitor.
8. Disinfection with sodium hypochlorite.
9. 2.5 MG product storage tank, product
distribution pumps, and 30-in diameter product
pipeline to Cal-Am distribution system near
Seaside.
10. 36-in brine disposal pipeline to MLPP existing
cooling water ocean discharge.
and KHC
3. Tenera Environmental, Preliminary Modeling of
Potential Impacts from Operation of a
Desalination Facility Ocean Intake, August 22,
2012
Persons Interviewed/Corresponded With Dennis Ing, Scott Jackson, Jonathan Dietrich
Page 2-5
Figure 2-2 DWD Project Location Map

____ Intake
____ Brine
____ Product Water
Desalination Plant
Tie-in to CAL AM
existing facilities

Page ES-2-6
2.3 PEOPLES MOSS LANDING (PML)
Project Name The Peoples Moss Landing Water Desal Project
Proponent(s) DeSal America, LLC composed of Moss Landing
Commercial Park, LLC; and Stanley and Patricia-
Vance Lueck
Location Moss Landing Commercial Park
This project is currently proposed as alternative to
the Cal-Am MPWSP.
Key Features 1. Raw seawater supply through an existing intake
system drawing from the Moss Landing Harbor.
2. Single-stage, zeolite pressure filtration followed
by ultrafiltration (UF) pretreatment.
3. Single-pass RO desalination treatment with
energy recovery.
4. Product stabilization with calcite, carbon
dioxide, and sodium hydroxide.
5. Disinfection unspecified, but presumed to be
with sodium hypochlorite.
6. Product storage in existing site tankage. New
distribution pump station and 36-in diameter
product pipeline to Cal-Am distribution system
near Seaside.
7. Brine disposal through existing 51-in (internal
diameter) outfall.
2. Project information package dated July 2012
and KHC
4. Video of a portion of the existing outfall.
5. August 2012 Structural Evaluation Report of site
structures and outfall, conducted by JAMSE
Engineering, Inc.
6. Construction drawings for the outfall (1973) and
modifications made to the intake pump station
(1968).
7. September 2012 Environmental Issues and
Constraints Report by SMB Environmental Inc.
Persons Interviewed/Corresponded With Nader Agha, George Schroeder, Stanley Lueck

Page 2-7
Figure 2-3 PML Project Location Map

____ Intake
____ Brine
____ Product Water
Desalination Plant
Tie-in to CAL AM
existing facilities
MONTEREY PENINSULA REGIONAL WATER AUTHORITY PROJECT FUNCTION
Page 3-1
3 PROJECT FUNCTION
The function of each proponent project is evaluated on the following criteria:
Project purpose
Customers identified
Adequacy of treatment approach
Residuals handling
Feed water characterization
Quality of project information
Omissions or fatal flaws
In an initial screening level evaluation
2
, we found no disqualifying criteria for any of the
candidate projects. We did however find differences in the level of project development and
approach. Each project is discussed separately below.
3.1.1 Project Purpose
Cal-Am proposes their project to serve the needs of the identified demand on the Monterey
Peninsula within their service area to comply with SWRCB Order 95-10. The proposed
treatment plant would serve the identified desalination component of the regional water supply
portfolio. They specifically do not propose to provide a plant capacity in excess of defined
regional water supply requirements under two scenarioswith GWR and without GWR
3
.

3.1.2 Customers Identified
Treated water would be supplied to the Cal-Water distribution system for service to its current
service area. Any groundwater from Salinas Basin drawn through the proposed supply wells
would be returned the basin as plant treated water through the Castroville Seawater Intrusion
Project (CSIP) ponds
3
.

3.1.3 Adequacy of Treatment Approach
Feed water for the desalination plant would be extracted from subsurface slant wells. Over the
long term, feed water is projected to include about 97 percent seawater and 3 percent intruded
groundwater from the Salinas Valley Groundwater Basin (SVGB)
3
. The desalination plant will
be operated such that on an annual average basis, the plant would return desalinated water to the
SVGB in an amount equal to the freshwater extracted from the slant wells.

2
SPI Memorandum, Monterey Desalination Study Initial Scoping and Constraints Analysis, August 30, 2012
3
Direct Testimony of Richard C. Svindland Before the Public Utilities Commission of the State of California, filed
April 23, 2012
PROJECT FUNCTION MONTEREY PENINSULA REGIONAL WATER AUTHORITY

Page ES-3-2
The preferred site for construction of the slant wells is an approximately 376 acre parcel of land
with 7,000 feet of ocean shoreline, located west of the proposed desal plant site. The angle of the
slant wells will be determined by a proposed test well program, with a maximum well length of
approximately 750 lineal feet. Wells would initially be placed on the beach, as far as possible
from the existing shoreline, but avoiding undisturbed dune habitat. This may cause some or all
wells to be within the predicted 50-year erosion boundary; however, the expected useful life of
the wells is less than 50 years. A contingency plan will be needed for relocating the wells inland
in the event that coastal erosion renders the wells inoperable
4
.
Two design capacities are proposed: (1) seven wells operating at 2,200 gpm per well plus one
additional well as a backup, for a total of 22 mgd (15,400 gpm) producing 9.0 mgd of product
water; (2) five wells operating at 1,840 gpm per well plus one additional well as backup, for a
total of 13.2 mgd (9,200 gpm) producing 5.4 mgd of product water
4
.
Eight feed water pipeline alignments are being considered, all of which will be made of HDPE or
FPVC, and will have a 30-inch or 36-inch diameter. The final selected alignment would include
a parallel 16-in diameter pump to waste pipeline, to allow wasting of initial produced water from
a pump following startup.
The proposed treatment plant would be located on a vacant but disturbed 46-acre parcel west of
the MRWPCA Regional Treatment Plant (RTP). The site would be accessed off of Charles
Benson Rd., a two-lane roadway that also serves the MRWPCA RTP along with the Monterey
Regional Waste Management District. A new turn lane would need to be provided to allow safe
access to the proposed desal plant for personnel and chemicals deliveries. Cal-Am is currently in
negotiations to purchase the site from the existing land owner. Overall, land acquisition is not a
large concern as Cal-Am has the authority to exercise eminent domain privileges should a
negotiated purchase prove untenable.
Incoming seawater would be stored in two 0.5 MG storage tanks then pumped to granular media
pressure filters. Provisions would be included to pre-chlorinate the filter feed if necessary; as
well as include proprietary media to remove iron and manganese should it be present in the raw
seawater. Filter effluent would be dechlorinated if necessary, then flow to inline cartridge filters
prior to routing to the RO trains. The proposed RO system would be arranged as a full single
pass and partial second pass; with the second pass product making up 40 50 percent of the final
product supply. The first pass trains would include high pressure booster pumps and isobaric
energy recovery devices (ERDs); while the second pass trains would be equipped with high
pressure booster pumps only. Operating recovery of the first pass trains would be roughly 45.5
percent; while the second pass trains would operate at 90 percent. First and second pass trains,
related pumps, and ERDs would be arranged in an N+1 configuration, with a total of four
process trains for the 5.4 mgd plant option and six process trains for the 9.0 mgd plant option.
5

The product water from the RO system would be post-treated with calcite and carbon dioxide for
stabilization, along with addition of a corrosion inhibitor. For disinfection, the product would be
dosed with sodium hypochlorite and stored in two, 1.0 MG storage tanks. Provisions may be
included for a temporary or permanent UV disinfection system as well, should conditions
warrant (e.g., if additional disinfection credits are required).
5

4
RBF Memorandum, Monterey Peninsula Water Supply Project (MPWSP) Project Description, April 20, 2012
5
Cal-Am Response to SPI Questions, October 3, 2012
Page 3-3
Overall the treatment approach is gauged to be sound. The greatest process risk is likely
associated with the propose slant wells. Slant well intake systems can provide significant
advantages over traditional open ocean intakes including:
Natural filtration
Avoidance of impingement and entrainment of marine life
No ocean construction impacts
No permanent aesthetic impacts.
However, slant wells can also pose more construction challenges than other well types as a result
of shallow construction angles and less vertical gravitational force. Slant wells need periodic
access to the well head area. In areas where recreation exists (e.g., at a public beach) provision
must be made to minimize disturbance
6
. Slant well intakes can be used with large desalination
plants, with seawater intake capacities of up to 50 mgd
7
. Maintenance of well specific capacity
long term is unknown; and elsewhere where employed the wells have been known to initially
draw from an ancient marine aquifer containing high levels of iron and manganese
8
. Lastly, the
specific long term amount of groundwater uptake from the SVGB, estimated at up to 3 percent,
is uncertain.
Cal-Am plans to install a test slant well to establish site specific operating conditions and
generate data which should help to confirm actual conditions and allow development of
appropriate mitigation strategies. Cal-Am has already included provisions for removing iron and
manganese across their pretreatment filters if necessary. The slant wells themselves can be
screened or installed at different angles to control the mix of seawater to diluent water extracted.
Cal-Am is currently pursuing permits for the test well. An initial operating period of 6 12
months is planned to develop data required for the EIR CEQA work. Cal-Am has indicated that
the test period could extend as long as 18-24 months if additional data is required
5
. Should the
test well reveal slant wells to be problematic, a more conventional Ranney sub-surface intake
well could be used as an alternative. The conceptual layout would include three vertical caissons
and horizontal well clusters located across a 1,000 1,500 feet beach front area. Each caisson
would be capable of extracting up to 10 mgd.
With either intake system, delivered raw seawater quality is likely to be good, with low
particulate and silt density index (SDI) levels, making single-stage filtration an acceptable
pretreatment approach. The RO process design is conservative, with a full first pass and partial
second pass; including N+1 redundancy for all process units. The proposal does not include
acidification or antiscalant dosing to the first pass RO system feed water, but this is likely
acceptable as the planned recovery of the first pass system is limited to 45 percent. Feed and
product storage tanks are arranges as 2 x 50 percent units, allowing the ability to take a tank out
of service for maintenance. A preliminary site plan indicates the proposed site is sufficient to

6
Williams, D.E. Design and Construction of Slant and Vertical Wells for Desalination Intake. IDA World
Congress-Perth Convention and Exhibition Centre (PCEC) Perth, Western Austrailia September 4-9, 2011 REF:
IDAWC/PER11-050
7
Pankratz, T. A Review of Seawater Desal Intake, Pretreatment & Discharge Technologies. IDA Iran 06 WDTS
Proceedings September 17 & 18, 2006
8
Ghiu, S. 18 Month Demonstration of Slant Well Intake System Pretreatment and Desalination Technology for
Seawater Desalination. WaterReuse Research Conference Proceedings, June 2012.

Page ES-3-4
accommodate the proposed treatment plant facilities and related administrative and maintenance
facilities adequately.

3.1.4 Residuals Handling
Plant residuals would be handled in a combination of storage and transfer systems. Backwash
waste from the filters would be collected in a 0.5 acre storage pond, with decant disposed with
the RO brine. RO brine would be sent to the MRWPCA ocean outfall. Analyses have shown
that the outfall has sufficient capacity to accommodate the projected peak brine flow from the
plant under all but a worst case hydraulic loading scenario that is anticipated to last for six
hours
9
. In these situations, brine would temporarily be stored on site in a 3.0 MG detention
pond. The majority of the time (96 percent) the outfall is projected to have sufficient capacity.
Waste residuals from the RO cleaning system would be neutralized and discharged with the brine
to the outfall as well; or alternately to the site sanitary sewer if disposal with the brine is not
permitted.

3.1.5 Feed Water Characterization
There has been no detailed characterization of plant feed water to date. Data will be generated as
part of the planned test well program.

3.1.6 Quality of Project Information
Available documentation for the Cal-Am project is the most extensive and well developed
among the three proponents. Primarily this is a consequence of their involvement in the
previously proposed regional project with Marina Coast Water District along with filings to the
CPUC supporting their proposed project and development of required CEQA documentation.
Appendices to their response to the TAC included the following:
RBF Memorandum, Monterey Peninsula Water Supply Project (MPWSP) Capital and
O&M Cost Estimate Update, April 20, 2012.
RBF Memorandum, Monterey Peninsula Water Supply Project (MPWSP) Project
Description, April 20, 2012.
Direct Testimony of Jeffrey T. Linam Before the Public Utilities Commission of the
State of California, Filed April 23, 2012.
Other project related documents were available on the Monterey Peninsula Water Supply Project
website, including:
California America Water Company, Coastal Water Project, Final Environmental
Impact Report, October 30, 2009.
Download Filings for Proceeding A1204019

9
Trussel Technologies Inc. Technical Memorandum, MRWPCA Outfall Hydraulic Capacity Analysis, April 18,
2012.
Page 3-5
Presentations, including Technical Workshops on Monterey Peninsula Water Supply
Project (July 2012); Monterey Peninsula Water Supply Project Presentation (April
2012); and Monterey Peninsula Water Supply Project Presentation (July 2012).
Project Map (April 23, 2012).
California American Water Application for Monterey Project (PDFA)
California American Water Application for Monterey Project (POS, NOA,PDFA)
California American Water Direct Testimony of Keith Israel, including a Technical
Memo from Trussell Technologies, MRWPCA Outfall Hydraulic Capacity Analysis,
April 18, 2012
California American Water Direct Testimony of Jeffrey T. Linam
California American Water Direct Testimony of Eric J. Sabolsice
California American Water Direct Testimony of F. Mark Schubert, P.E.
California American Water Direct Testimony of David P. Stephenson
California American Water Direct Testimony of Richard C. Svindland
California American Water Direct Testimony of Kevin Thomas
Cal-Am also provided a response to questions from SPI, including the following documents:
Capital Cost Worksheet
O&M Cost Worksheet
RBF Memorandum, Implementation Schedule Risk Analysis of Water Supply
Alternatives, October 24, 2011
RBF Memorandum, Cost Analysis of Water Supply Alternatives, October 19, 2011
Overall the information is considered sufficient to evaluate the proposed project from a technical
and economic perspective.

3.1.7 Omissions or Fatal Flaws
Our evaluation and investigation of the proposed Cal-Am project did not uncover any perceived
fatal flaws or significant omissions of project information.

DWD proposes a project that could serve both the defined demand within the Cal-Am service
area for a desal supply of either 5,500 AFY or 9,000 AFY along with an expanded supply for the
region with a total plant capacity of 25,000 AFY. The project is predicated on development of
certain components (e.g., the seawater intake, feed pipeline, brine pipeline) for the 25,000 AFY
plant, with cost allocation based on treated water flow to defined customers.

Page ES-3-6

DWD seeks to supply either 5,500 AFY or 9,000 AFY to Cal-Am. The balance of the proposed
plant capacity would be supplied to other customers. These may include the City of Santa Cruz,
Soquel Creek Water Distict, Pajaro Valley Water Management Agency, areas of North Monterey
County which may have a need and communities along the Highway 101 corridor between
Salinas and Santa Clara.

DWD proposes two plant design capacities to meet the 5,500 AFY and 9,000 AFY delivery
targets4.9 mgd and 9.1 mgd. Each of these capacities is different than the Cal-Am listed flows
of 5.4 mgd and 9.0 mgd, respectively.
DWD proposes a new passive-screened open seawater intake drawing from Monterey Bay near
Moss Landing. Feed water would be withdrawn from a new 48-in. diameter pipe that would
replace an existing pipeline previously used by PG&E for offloading fuel oil. The intake pipe
would be 10,000 feet long and located at a depth of approximately 65-ft at its end. The pipe
terminus would be screened with a passive, cylindrical wedge-wire screen constructed with 2
mm. slot openings and a maximum design velocity of 0.5 fps through the screen to prevent
impingement of marine organisms.
The intake would cross Hwy. 1 through an existing utility tunnel; or space not permitting, a new
crossing. The line would connect to an existing, abandoned pump clear well at the Dynegy Moss
Landing Power Plant (MLPP). New pumps would be installed to transfer the influent seawater
from the clear well through a new 48-in diameter HDPE pipeline to the project site located
roughly one mile north of MLPP along Hwy. 1, a location known as the Capurro Ranch. En
route to the site, the water would transition through a proprietary warming system owned by
Dynegy, increasing its temperature from roughly 10 C up to as high as 34 C.
The project site is currently occupied by an active vegetable distribution facility, with two large,
refrigerated buildings on-site. The site is currently owned by MFLK Partnership, who are also
equity partners in DeepWater Desal LLC. DWD has secured a 34-year ground lease for the site
with an option to extend it for two successive 32-year periods. The site area is 8.14-acres; and
DWD has secured an option to lease an additional 8-acre parcel adjacent to the site should
additional area be required for plant construction.
No feed water storage tanks are proposed, with the supply pumped directly to granular media
pressure filters. Provisions would be included to pre-chlorinate the filter feed if necessary; as
well as include a filter aid coagulant (ferric chloride). Filter effluent would be dechlorinated if
necessary, then flow to inline cartridge filters prior to routing to the RO trains. The proposed RO
system would be arranged as a single pass system. The trains would include high pressure
booster pumps and isobaric ERDs. Operating recovery of the first pass trains would be variable
between 43 and 47 percent. The RO trains, related pumps, and ERDs would be arranged in an
Page 3-7
N+1 configuration, with a total of three process trains for the 4.9 mgd plant option and six
process trains for the 9.1 mgd plant option.
10

dosed with sodium hypochlorite and stored in a single 2.5 MG storage tank.

Overall the treatment approach is gauged to be sound, though the proposed RO system design
would produce a lower quality product than the proposed Cal-Am system, consisting solely of a
single pass of RO treatment. The greatest process risk is likely associated with the proposed
open intake and feed water delivery system. Water quality sampling conducted at depth has
indicated the raw seawater will likely be low in turbidity and suspended solids. This is backed
up by available literature. Intake depth can have a significant impact on water quality. Sun rays
are absorbed by the ocean surface, limiting photosynthesis and algae quantity as depth increases.
It is for this reason that deep water intakes typically provide feed water with less biological
activity and fewer suspended solids than conventional open water/surface intakes. However, the
disadvantage is that seawater temperature decreases with depth, increasing either membrane
surface area or feed pressure required for treatment. On the other hand, more stable annual
temperatures at this depth may facilitate plant design and operation
11
. To address the
temperature issue, DWD has proposed warming the supply in proprietary system on the MLPP
site. The proposed system is subject to a non-disclosure agreement at present, limiting the
publicly available information. However, it appears the system will likely be integral to
operations at the MLPP, providing a cooling water source. The approach is certainly synergistic,
but it also in effect links operations between MLPP and the desal plant to a certain extent,
introducing potential reliability issues. In addition, there is no experience with the effect of
warming a deep source supply. There is potential for the increase in temperature to cause an
increase in biological activity and associated biological fouling within the treatment process.
There is no way to gauge the potential magnitude of this risk element at this time. The DWD
project proponents do not consider it a large concern and have not proposed a pilot test program
on the candidate source water and overall pretreatment process. The issue becomes what would
be the impact of a problem discovered once the project was built? Remedies may be limited if
the warming process is contingent on an agreement between Dynegy and DWD. If the warming
process could be bypassed, then the issues with cold water treatment would come into play,
increasing RO system operating pressures and potentially exceeding operating capabilities of
installed pumping equipment.
The RO process design from an operations perspective is conservative, with N+1 redundancy for
all process units. There is no proposed feed storage tank, which is considered acceptable; but the
lack of any type of redundancy in product storage is a concern; as any required maintenance on
the tank would necessarily require a shutdown of the treatment facility unless suitable temporary
storage could be obtained. A preliminary site plan indicates the proposed site is sufficient to
accommodate the proposed treatment plant facilities and related administrative and maintenance
facilities adequately.

10
DWD Response to SPI Questions, September 12, 2012
11
Cartier G., Corsin P. - Description of Different Water Intakes for SWRO Plants. IDA World Congress-
Maspalomas, Gran Canaria Spain October 21-26, 2007 - REF: IDAWC/MP07-185.

Page ES-3-8
From a process perspective, the proposed pretreatment system design is likely acceptable. There
is sufficient precedence for single stage filtration on open seawater intakes among successfully
operating facilities to provide confidence in this approach
12
. The proposal does not include
acidification or antiscalant dosing to the first pass RO system feed water, but this is likely
acceptable if recovery is limited to the proposed operating range. A larger concern is with the
RO system process design as a single pass system which would produce a treated product supply
with TDS, boron and chloride levels above the existing supplies from the Carmel River. It is our
recommendation that any desalination system incorporating RO as the primary process for
Peninsula customers include a partial (at least 40 percent) second pass RO system to further
improve product quality, especially at the elevated temperature operation proposed.

Backwash waste from the filters would be collected in a 175,000 gallon settling tank, with decant
sent to a separate 150,000 gallon tank for disposal along with the RO brine. RO brine would be
sent to back to MLPP for disposal along with the plant cooling water through their existing ocean
outfall at a projected dilution ratio between 20 and 60 to 1. DWD also proposes to neutralize
chemical cleaning wastes and dispose of them with the brine as well.
During our site visit it was made clear that an agreement between DWD and Dynegy for use of
the cooling water outfall was still subject to negotiation among the parties.

DWD has a buoy in the area of the proposed intake collecting data on salinity, temperature and
turbidity at fixed intervals. Comprehensive analytical data is not available at this time. DWD
has retained Tenera Environmental to conduct a 12 month study on impingement and
entrainment issues. Sampling in support of the study is ongoing. Tenera did conduct a
preliminary analysis based on available information and a proposed intake flow of 25 mgd. That
report found low projected levels of entrainment. However, additional more detailed analyses
are required based on site specific data; in particular to assess the presence of a large, vertical
mixing zone at the interface of the submarine canyon in the bay
13
.

Available documentation for the DWD project is adequate at this stage of project development.
DWD has not yet progressed with their formation of a joint powers authority (JPA) for project
implementation and production of environmental permitting packages. Information collected to
data has largely been in service of defining the project approach, securing agreements, and
developing project cost estimates. The nature of the agreement between DWD and Dynegy is
still confidential between the parties.
A listing of documents provided in addition to the response to the TAC is as follows:

12
DWD Response to SPI Questions, September 8, 2012.
13
Tenera Environmental, Preliminary Modeling of Potential Impacts from Operation of a Desalination Facility
Ocean Intake, August 22, 2012.
Page 3-9
Product Water Pipeline Alignment
Intake Pipeline Hydraulic Grade Line
Draft Design Criteria
Tenera Preliminary Intake Assessment
Conductivity, Temperature and Turbidity Data May 30 June 12, 2012.
Raw Water Characterization Program Memo
Capital and O&M Cost Estimate Worksheets
Site Layout for Capurro Ranch
Presentation: An Oceanographic Solution to Product Freshwater, August 2012
Overall the information is considered sufficient to evaluate the proposed project from a technical
and economic perspective.

We have not identified any fatal flows with the DWD proposed system. The only omissions of
information are acknowledged by DWD and related to the agreements between DWD and
Dynegy.

PML proposes a project that could serve the defined demand within the Cal-Am service area for
a desal supply of either 5,500 AFY or 9,000 AFY.

PML seeks to supply either 5,500 AFY or 9,000 AFY to Cal-Am. Supply to other customers is
not proposed.

PML proposes two plant design capacities to meet the 5,500 AFY and 9,000 AFY delivery
targets4.8 mgd and 9.1 mgd. Each of these capacities is different than the Cal-Am listed flows
of 5.4 mgd and 9.0 mgd, respectively. The difference results from their targeting deliveries of
5,000 AFY and 10,000 AFY in their response to the TAC and subsequent information provided
to SPI.
PML proposes to use an existing seawater intake system originally installed to serve the Kaiser
Refractories Moss Landing Magnesia Plant back in 1968the same site that is now called the
Moss Landing Commercial Park (MLCP). The pump station draws from the Moss Landing
Harbor and supplies water to the site through two 36-in diameter pipelines that cross beneath

Page ES-3-10
Hwy. 1 through a pair of 72-in corrugated steel conduits. One of the pipelines has been
upgraded to steel throughout its length; while the second maintains a section of the original wood
staved piping on site. Proponents have also indicated the ability to repurpose the existing site
seawater outfall as dual intake-outfall conduit extending into the Monterey Bay out front of Moss
Landing Harbor. The existing concrete outfall is 51-in internal diameter; and could have a new
intake line installed in the annular space; with brine flowing out in the opposite direction. Cost
estimates provided to SPI were based on use of the existing intake system so this approach forms
the basis of our evaluation.
The 1968 drawings show the installation of seven pumps. The condition of the pumps at this
time is unknown; but would likely require rehabilitation and rework to supply the proposed
treatment plant. The pump bowls reportedly draw from below the harbor seafloor, but the actual
depth is unknown.
The MLCP site still contains infrastructure from the time it was employed as a magnesium
extraction facility. The total site occupies roughly 200 acres; with a proposed 25 acre parcel
offered for sale or lease as part of the proposed desal treatment plant. Available facilities offered
for use include the following:
Intake pumps and pipeline and outfall pipeline.
Up to four 5.0 MG concrete storage tanks.
A 12kV, 12,000 amp electrical service along with two 1,000 amp engine generators.
Rail transportation terminal.
Non-exclusive easements for site access.
Non-exclusive use of a 2,100 gpm well supply source.
A 5,000 gpd trailer-mounted pilot plant.
Up to 20,000 sq. ft. of existing buildings.
Existing infrastructure is in various states of repair as detailed in two site investigations
14,15
and
would require some refurbishment and rework to be acceptable for integration into a municipal
drinking water facility. Portions of the site are likewise located within the flood plain
16
and
constructed facilities would need to be built in accordance with any ensuing requirements.
The proposed PML treatment system would include inlet screens, booster pumps, single stage
pressure filters, an ultrafiltration (UF) membrane treatment system, antiscalant dosing system,
high pressure booster pumps with pressure exchange type ERDs, single pass RO system, post-
treatment system, and product storage and distribution pump station. The RO system would
operate at 40 percent recovery and limit operating flux to 8 gfd. The UF system would operate at
a proposed flux of 35 gfd.

14
Replacement Cost Approaisal Summary Report, prepared by Landmark Realty Analysts, Inc., October 3, 2011.
15
Structural Evaluation, Intake & Outfall Pipelines, Intake Pump Station and Water Storage Reservoirs, The
Peoples Moss Landing Water Desalination Project, Moss Landing Green Commercial Park, Modd Landing, CA,
August 14, 2012.
16
Monterey County Planning & Building Inspection Department; Meeting September 30, 2004, Agenda Item 6.
Page 3-11
dosed with sodium hypochlorite and stored in existing tankage on site.

PML did not provide a detailed list of equipment or a site layout plan, stating that it was too early
in the development of their project to have that information developed. It is therefore somewhat
difficult to gauge the robustness of their approach. From the narrative description provided and
listed membrane area assumptions, it is not clear that the major UF and RO train equipment
contain redundant process units.
From a process perspective, the proposed pretreatment system design may be acceptable. The
largest unknown is the quality of water that will be extracted from the Moss Landing Harbor.
There could be organics, metals and other contaminants entrained in the sediments overlaying
the supply pumps that could complicate treatment. PML has proposed conducting a pilot study
program prior to finalizing their process design, so this should help allay concerns. A previous
pilot study conducted at MLPP found that direct UF pretreatment operated in concert with a
coagulant was effective at pretreating a supply drawn from the Moss Landing Harbor, but that
flux should be limited to 30 gfd
17
.
A larger concern is with the RO system process design as a single pass system similar to the
DWD approach. As stated in that discussion, we recommend including a partial second pass RO
treatment system to produce a final product quality more in keeping with current supplies in the
distribution system.

Pretreatment residuals would come from the proposed filters and UF process units. A backwash
recovery system is proposed, with decant sent to the outfall with the RO system brine stream.
Neutralized UF and RO cleaning wastes would be treated similarly; or recovered for reuse within
the MLCP. Brine would be discharged to the existing outfall.
The outfall is currently not in use and there is evidence of disrepair in a video survey conducted
sometime prior to 2008
18
. The video shows evidence of several areas of decoupling along the
main outfall alignment. Also, according to the original plans, the outfall was installed below
grade until the diffuser section
19
. However, portions of the main outfall appear to be currently
uncovered; and one section shifted uppossibly as a consequence of the 1989 Loma Prieta
earthquake. Many of the diffusers are clogged and covered with marine growth; and from the
terminus of the outfall it appears it may be largely filled with sandup to half of the
circumference. Consequently a fair amount of rehabilitative work would be required to place the
outfall into service, and more detailed assessmentincluding an inspection of the interior of the
outfallis warranted.

17
Coastal Water Project Pilot Plant Report, May 2010, MWH.
18
Outfall Video, Moss Landing Marine Lab, California State University.
19
Seawater Outfall for Kaiser Aluminum and Chemical Corporation, Moss Landing, California, by Kaiser
Engineers, 1971.

Page ES-3-12
PML does not at this point have analytical data characterizing the proposed raw water supply. It
will presumably be collected during their planned pilot test program.

The PML project is the least developed among the three as evidenced by the level of information
provided. They were however very forthcoming in sharing all that was available, including
original construction plans for the intake and outfall, video survey of the outfall, and other site
specific reports.
A listing of documents provided in addition to the response to the TAC is as follows:
Construction Plans: Seawater Outfall
Construction Plans: Relocation of Sea Water Intake
The Peoples Moss Landing Water Desal Project, Important New Updates, July 2012
Response to SPI Questions, September 4, 2012 and September 27, 2012
Environmental Issues and Constraints Report, SMB Environmental, September 2012
Structural Evaluation, JAMSE Engineering Inc., August 2012.
Replacement Cost Appraisal Summary Report, Landmark Realty Analysts, Inc.,
October 2011.
Adopted Waste Discharge Requirements Order No. R3-2009-002, National Pollutant
Discharge Elimination System (NPDES) Permit No. CA0007005 Moss Landing
Commercial Park and Moss Landing Cement Company, Moss Landing Cement
Company Facility, Monterey County, March 2009.
Overall, the lack of specificity as to the proposed plant facilities makes the technical and
economic evaluation difficult and forces us to make additional assumptions on our own.

We have not identified any fatal flows with the PML proposed system. The primary omission is
the lack of defined lists of equipment in order to assist in validating cost estimates.
MONTEREY PENINSULA REGIONAL WATER AUTHORITY PROJECTED PERFORMANCE
Page 4-1
4 PROJECTED PERFORMANCE
This section discusses the following performance issues for each project:
Plant design capacity
Targeted product water quality
Disinfection strategy
Plant design capacity refers to the proposed instantaneous flow achieved by a given plant design
to achieve the annual produced water flow of 9,000 AFY or 5,500 AFY. The design capacity of
a facility impacts both its construction and operating cost, and must take account of issues such
as equipment redundancy, periodic maintenance, and overall online operating factor.
The issue of product water quality is closely tied to the proposed demineralization system
process design of each facility. As discussed previously, DWD and PML have proposed single
pass RO systems; while Cal-Am has proposed a partial (40 percent) second pass system. The two
approaches will produce different qualities of final product water from an overall salinity
perspective, as well as levels of boron and chloride.
In addition to salinity and individual constituent targets, the design must also achieve regulatory
pathogen removal thresholds. The California Department of Public Health (CDPH) has primacy
to regulate public water systems within the State. As such, they will review these proposed
treatment approaches for compliance with the Surface Water Treatment Rule (SWTR) and the
Long Term 2 Enhanced Surface Water Treatment Rule. It is anticipated the slant wells proposed
for the Cal-Am project would be deemed groundwater under the influence of surface water and
subject to the surface water regulations, as would the open intake sources for DWD and PML.
Pathogen removal/inactivation requirements are quantified in increments of influent to effluent
concentration, expressed in a log scale. For example 3-log removal is 99.9%. CDPH will
establish the log removal requirements of a project based on information on the quality of the
source water and other factors. The expected ranges of possible requirements for these projects
are 3-5 for Giardia; 2-4 for cryptosporidium (crypto); 4-6 for virus. Some project proponents
have indicated an expectation the requirements will fall at the low end of the ranges.
Each treatment process is assigned a log removal credit for each pathogen. By summing the
credits of all processes in the multi-barrier approach (filters, RO, disinfection, etc.) a total credit
is achieved to meet or exceed the regulatory requirement. Under the disinfection strategy
discussion we consider the removal credits likely achieved by the proposed projects.
4.1.1 Plant Design Capacity
Defined demand requirements for the proposed supply to the Monterey Peninsula customers are
5,500 AFY and 9,000 AFY. Plant designs are rated in instantaneous production capacities for
the purposes of sizing equipment (pumps, RO membrane trains, etc.) in units of mgd. 1.0 mgd is
equivalent to annual production rate of 1,120 AFY. The required minimum plant capacity would
therefore translate to 4.9 mgd or 8.0 mgd. This however is not necessarily what we would
recommend as a conservative municipal plant design basis. Equipment breaks down, membranes
PROJECTED PERFORMANCE MONTEREY PENINSULA REGIONAL WATER AUTHORITY

Page ES-4-2
require cleaning, power outages occur. Without excess treatment capacity or high levels of
component redundancy, annual deliveries could fall short.
Cal-Am has proposed a design capacity basis of 5.4 mgd or 9.0 mgd. These capacities are fairly
close to what you would get by assuming the treatment plant is on-line and producing water 90
percent of the time, which results in capacities of 5.45 mgd and 8.92 mgd. A 90 percent on-line
factor is consistent in our experience of a well-designed and operated municipal RO plant that
does not have redundant process units (e.g., RO trains). In Cal-Ams case, they are proposing
redundant process units, so its likely the facility will be capable of producing its nameplate
capacity of 5.4 mgd or 9.0 mgd better than 90 percent of the time.
An additional issue specific to Cal-Am however is the potential extraction and return of
groundwater from the SVGB. Cal-Am estimates as much as 8 percent of the plants annual
production capacity may need to be returned to the basinup to 780 AFY for the 9,000 AFY
demand scenario
20
. This has the effect of increasing the annual flow requirement to 5,960 AFY
or 9,780 AFY; and corresponding minimum plant design capacity to 5.3 mgd or 8.7 mgd.
Looked at another way, the plant would need to run at the proposed design capacity roughly 98
percent of the time to meet the higher delivery requirement. With the level or redundancy in Cal-
Ams design we consider this achievable but not overly conservative.

4.1.2 Targeted Product Water Quality
Though Cal-Am has produced a good degree of information to date with regard to their proposed
project, the majority has been in service of supporting their CEQA and CPUC approval
processes. They have specifically not developed a target product water quality specification,
beyond stating the final product water will meet all State Maximum Contaminant Levels (MCLs)
and be non-corrosive. Rational for a partial second pass RO system includes concerns over
levels of boron, chloride and sodium in the final product water as well
20
. Also in a presentation,
Cal-Am projected treated water TDS from the plant of 380 mg/L and chloride level of 60 mg/L
to blend with existing supplies with a TDS of 440 mg/L and chloride level of 90 mg/L
21
.
From their proposed process design and post-treatment strategy we can however model projected
product quality independently. In Table 4-1 we have summarized our projection of water
quality produced from a partial two-pass RO process (40 percent blend of second pass product)
stabilized with calcite, carbon dioxide and sodium hydroxide.

20
RBF Memorandum, Monterey Peninsula Water Supply Project (MPWSP) Project Description, April 20, 2012..
21
Presentation Monterey Peninsula Water Supply Project Presentation to Monterey Co. Water Resources
Agency, June 25, 2012.
Page 4-3
Table 4-1 Summary of Projected Product Quality from Cal-Am Facility
Chloride mg/L 60
Boron mg/L 0.5
pH units 8.0
Calcium mg/L as CaCO3 40
Alkalinity mg/L as CaCO3 40

4.1.3 Disinfection Strategy
Cal-Am has stated their intent for their pathogen removal credits to comply with the Surface
Water Treatment Rule (SWTR) and achieve 4 log removal of giardia and 6 log removal of virus.
This would be accomplished through a multi-barrier treatment approach including their intake
wells, pretreatment filters, RO process, chlorine disinfection, and (if required) UV disinfection.
Our evaluation of the proposed Cal-Am process in terms of specific pathogen credits is presented
in Table 4-2. The ability of Cal-Ams slant-wells to receive aquifer (bank) filtration credit is
uncertain (dependent on design and local conditions) and the inclusion of UV disinfection is
tentative, totals were calculated with and without those values.

Table 4-2 Summary of Projected Pathogen Credits for Cal-Am Project
Parameter Giardia Crypto Virus
CDPH Requirement (Potential Range) 3-5 2-4 4-6
Aquifer Filtration 1 1 -
Granular Media Filtration 2.5 2 2
RO 2 2 2
UV 2 2
Chlorination 0.5 2+
TOTAL without Aquifer Filtration Credit &
UV
5 4 6+
TOTAL without UV 6 5 6+
TOTAL of All 6+ 6+ 6+

Page ES-4-4
The original DWD response to the TAC included proposed demand conditions of 25,000 AFY
and 10,700 AFY, with plant capacities of 22.3 mgd and 9.1 mgd. In response to questions from
SPI, DWD proposed to meet the 9,000 AFY condition with their original 9.1 mgd plant capacity,
and the 5,500 AFY condition with a plant rated at 4.9 mgd.
Using the same performance metrics discussed above for Cal-Am, the DWD facility would need
to operate at an online factor of roughly 100 percent for the 5,500 AFY demand condition; and
88 percent for the 9,000 AFY scenario. Its unclear why DWD used varying assumptions for
each condition, but could be a consequence of their larger, regional facility approach and an
assumption that the 5,500 AFY supply would be served as a portion of a larger capacity
treatment plant.
Like Cal-Am, DWD includes sufficient redundancy in their proposed treatment system
equipment to justify a greater than 90 percent online factor. On an equivalent basis with Cal-
Am, a 98 percent online factor would result in plant capacities of and 5.0 mgd and 8.2 mgd,
respectively.

In their response to questions from SPI, DWD provided their target product water quality which
is reproduced in Table 4-3. In general, DWD proposes to provide a product supply that is
compliant with all applicable drinking water regulations, is non-aggressive, and compatible with
existing supplies in the Cal-Am distribution system.

Table 4-3 Summary of Projected Product Quality from DWD Facility
Total Dissolved Solids mg/L <500
Chloride mg/L 128
Boron mg/L <0.9
pH units 7.0 8.0
Calcium mg/L 20 - 50
Alkalinity, as CaCO3 mg/L >55

Due to their proposed warming process, the product water will also likely have a temperature
between 29 34 C (84 93 F). This may be excessive depending on the temperature of
existing supplies within the Cal-Am distribution system, temperature loss during transmission
and their ability to blend and lower the delivered temperature to customers.

Page 4-5
DWD will achieve required disinfection and pathogen removal credits though media filtration,
RO, and chlorine disinfection. We project the overall process to achieve overall requirements as
summarized in Table 4-4.

Table 4-4 - Summary of Projected Pathogen Credits for DWD Project
RO 2 2 2
Chlorination 0.5 2+
TOTAL 5 4 6+

The PML response to the TAC included proposed demand conditions of 5,500 AFY and 10,700
AFY, with plant capacities of 4.8 mgd and 9.4 mgd. In response to questions from SPI, PML
proposed new capacity increments of 5,000 AFY and 10,000 AFY. Corresponding production
capacities were not provided, though a narrative equipment list with design operating flux and
membrane area and element assumptions were provided for each scenario. From this
information, we calculated a plant design capacities of 4.5 mgd and 9.0 mgdroughly
equivalent to producing 5,000 AFY or 10,000 AFY if operated continuously (100 percent online
factor). Actual target delivery scenarios for the peninsula are 5,500 AFY and 9,000 AFY.
From the equipment information provided it does not appear that any excess membrane area is
proposed that would indicate the presence of redundant equipment. With this approach, a lower
assumption of achievable plant online factor would be recommended. However, we do not
consider the approach good design practice and find it at odds with proposed systems from the
other candidate proponents. We have therefore evaluated the PML system in our analysis of
having redundant process units and therefore an equivalent system design capacity to DWD of
either 5.0 mgd or 8.2 mgd.

PML provided their target RO product water quality in a response to SPI, which is reproduced in
Table 4-5Table 4-3. Included in the response was a statement that final product quality has not
been established, but would meet all requirements stipulated in U.S. EPA drinking water
standards.

Page ES-4-6

Table 4-5 Summary of Projected Product Quality from PML Facility
1
Chloride mg/L 131
Boron mg/L 0.6
pH units 6.6
Calcium mg/L 1
Alkalinity, as CaCO3 mg/L 1
1
Listed quality is projected permeate from the RO system, prior to final stabilization and pH adjustment.

With their currently proposed pretreatment strategy, sufficient log removal credits for giardia,
crypto and virus should be achievable. One unknown however is the level of organics that may
be present in the harbor-extracted supply; and the potential to create disinfection byproducts.
This issue should be explored in the planned pilot test program, which will also be used to
finalize the proposed process design and disinfection strategy. Our evaluation results are
presented in Table 4-6.

Table 4-6 - Summary of Projected Pathogen Credits for PML Project
MF/UF 4 4 2
RO 2 2 2
Chlorination 0.5 2+
TOTAL 6+ 6+ 6+
MONTEREY PENINSULA REGIONAL WATER AUTHORITY ECONOMICS
Page 5-1
5 ECONOMICS
In our original project scoping technical memorandum
2
we recommended the following criteria
to evaluate the candidate projects on an equivalent basis:

Uniformity in plant design capacity for the two non-regional approaches; equivalent
capacity allocation for the proposed DWD regional project.
Equivalency in treatment to achieve: a common RO feed water quality following
pretreatment; a common treated water quality goal; and pathogen removal credits
required for the applicable supply source.
Uniformity in equipment redundancy.
Uniformity in unit cost criteria for common items.
Uniformity in cost factors applied to aggregated costs (e.g., contingencies; electrical
and I&C costs; etc.).
Uniformity in unit costs for chemicals and other consumables for treatment
evaluations.
We accomplished implementing the above principles in large measure in our economic
evaluation. We adjusted plant capacities for the evaluation on the basis described in Section 4,
rating Cal-Ams proposed system at design capacities of 5.4 mgd and 9.0 mgd; and the DWD
and PML systems at 5.0 mgd and 8.2 mgd. In terms of treatment process, we attempted to
maintain the overall proposed process design of the proponents, but did evaluate all as including
a partial (40 percent) capacity second pass RO system. We also assumed N+1 redundancy on all
rotating equipment and major treatment process units (e.g., filters, RO membrane trains). We
employed an equivalent basis in developing our capital equipment cost estimates, relying on
targeted quotes for equipment and SPIs cost information from past, similar seawater RO projects.
For indirect costs, we assumed fixed factors and applied them uniformly to each project. Each
factor, expressed as a percentage, was applied to estimated plant construction cost, absent costs
associated with off-site trenched pipelines. These factors included the following:
1. Implementation Costs at 25 percent, to include items such as permitting, pre-construction
design services, procurement development, and compliance activities.
2. Mobilization/Demobilization costs at 2 percent to account for supply and removal of
contractor equipment to the facility during construction.
3. Electrical and I&C Systems cost at 18 percent, accounting primarily for post-service
switchgear, motor control centers, drives, conduits, wire and SCADA systems.
4. Engineering and Startup cost at 15 percent, to include contractor engineering, overhead,
profit and commissioning expenses.
In addition, specific allowances were made to account for offsite right-of-way, easement and
land acquisition costs, to cover items such as roadway repair, rehabilitation and replacement,
separate from pipeline construction costs. These were applied at $80/LF for offsite trenched
pipelines, in the absence of more specific proponent developed estimates. Similarly, additional
ECONOMICS MONTEREY PENINSULA REGIONAL WATER AUTHORITY

Page ES-5-2
project specific costs were applied as applicable for things like annual property lease and
administrative payments and pilot testing.
In addition to indirect costs, final contingency and mitigation allowances were applied. For
contingency, we recommend a value of 30 percent at this stage of project development. While
some proponent projects have more project definition than others at this stage, we find
significant risk elements for each that warrant this level of conservatism. For mitigation, weve
applied a 1 percent allowance to the overall project cost. As no project has advanced to the stage
where a mitigation plan is in place, we consider it prudent to consider a pro-forma allowance at
this time.
Capital facilities costs have been aggregated into the following six categories for presentation:
1. Intake/Outfall includes costs associated with intake wells, pipelines and pump stations
along with corresponding facilities associated with brine disposal. All product pipelines
were estimated to a common terminus in Seaside at the existing Cal-Am meter location.
2. Pretreatment and Residuals Handling includes facilities for the pretreatment of seawater
ahead of the RO system, including filters, chemical feed systems, storage tanks and
related facilities associated with the treatment and disposal of any residuals.
3. Desalination System covers the RO membrane trains, high pressure feed pumps, energy
recovery devices, and membrane cleaning system.
4. Post-Treatment includes product stabilization systems and disinfection processes.
5. Distribution includes treated water storage, pumping and conveyance systems,
including offsite trenched pipelines.
6. Site Structures includes site related buildings, roads, landscaping, site fencing and other
related structures.
For annual operating costs and other expenses we implemented a similar approach. Chemical
unit prices were standardized across our estimates as listed in Table 5-1.
Table 5-1 Summary of Chemical Unit Prices
Chemical Name Unit Price
Sodium Bisulfite $0.45/lb
Sodium Hypochlorite $1.12/lb
Sodium Hydroxide $0.20/lb
Lime (Calcite) $0.17/lb
Carbon Dioxide $0.22/lb
Scale Inhibitor (antiscalant) $1.63/lb
Sulfuric Acid $0.15/lb
Ferric Chloride $0.40/lb
Corrosion Inhibitor $0.80/lb
Page 5-3
The rates were primarily based on Cal-Ams response to SPIs questions, though we did use the
DWD unit prices for corrosion inhibitor and sodium bisulfite. Corrosion inhibitor was not listed
in the Cal-Am unit prices; and their listed price for sodium bisulfite ($2.70/lb) seemed high and
was significantly above other pricing on this chemical that we have seen.
In terms of chemical application rates/dosages, we primarily maintained the rates proposed by
the individual proponents, unless we found a process-specific reason to adjust them.
Similar to the capital cost estimates, annual operating and maintenance (O&M) costs were
aggregated for presentation into four main categoriesEnergy, Chemicals, Expendables, and
Other. Each facility was assumed to operate full time (365 days per year). Energy costs were
developed by estimating loads and efficiencies of motorized equipment items and assigning an
electrical unit cost. Cal-Am provided variable summer and winter electrical rates from PG&E at
an average annual cost of $0.131/kW-hr. The other two projects in the Moss Landing area
proposed rates of $0.08/kW-hr. We were not able to disprove any of the listed rate assumptions
and therefore left them as stated by the individual proponents for the purposes of our evaluation.
The expendables category includes replaceable media for filters (including MF/UF) and RO
process membranes. Equivalent unit costs were used for MF/UF process membranes ($1,000 per
module), cartridge filter elements ($16 per 40-in cartridge), and RO membrane elements ($500
per element). Both MF/UF and RO process membranes were assumed to have a 5-year life.
The Other category lists separately operations and maintenance labor and equipment replacement
costs. Cal-Am provided the most detailed estimate of operation and maintenance labor
requirements and costs, which were therefore applied equally across the three projects. It is
reasonable to assume at this point that any of the candidate facilities would be operated by a
contract operations group with a similar pricing structure.
For an equipment replacement allowance, we instituted a common factor of 1.5 percent of the
complete system cost (including offsite trenched pipelines but prior to application of indirect
costs, contingencies, and mitigation allowances) as an annual expense.
The results of our evaluation are presented in Table 5-2 on the following page. The table
summarizes our assessment of the relative cost of each project on the common evaluation criteria
described above. Based on the information used in its preparation and our overall scope of
evaluation, we would consider it a Class 5 estimate as defined by the Association for
Advancement of Cost Engineering (AACE), having an accuracy range of -30 to +50 percent.
The AACE defines the use of Class 5 estimates as focused on conceptual screening of
alternatives.


Page ES-5-4
Table 5-2 Summary of Evaluated Capital and Operating Cost Estimates
Cost Element
Project Proponent
Cal-Am DWD PML
9 kAFY 5.5 kAFY 9 kAFY 5.5 kAFY 9 kAFY 5.5 kAFY
CAPITAL COSTS (in Millions 2012 Dollars)
Intake/Outfall $37.0 $31.7 $2.71 $1.66 $3.00 $3.00
Pretreatment & Residuals Handling $10.6 $7.94 $11.2 $7.94 $20.2 $13.6
Desalination System $22.3 $15.1 $19.4 $13.2 $19.9 $14.0
Post-Treatment $1.48 $0.88 $1.48 $0.88 $1.66 $1.07
Distribution $17.0 $16.0 $29.0 $28.9 $22.4 $22.3
Site Structures $11.5 $10.8 $3.65 $2.52 $10.0 $7.00
Indirect Costs
1
$58.0 $50.8 $54.5 $47.5 $67.9 $62.3
Contingency Allowance (30%) $47.4 $40.0 $36.6 $30.8 $43.6 $37.0
Mitigation Allowance (1%) $1.60 $1.30 $1.20 $1.00 $1.50 $1.20
TOTAL $207 $175 $160 $134 $190 $161
ANNUAL O&M COSTS (in Millions 2012 Dollars)
Energy $5.83 $3.54 $3.93 $2.41 $4.20 $2.56
Chemicals $0.32 $0.19 $0.83 $0.50 $0.93 $0.57
Expendables $0.69 $0.45 $1.02 $0.68 $1.09 $0.65
Other Proponent Expenses -- -- $2.85 $2.60 -- --
O&M Labor $2.69 $2.36 $2.69 $2.36 $2.69 $2.36
Equipment Replacement
2
$1.50 $1.23 $1.01 $0.83 $1.16 $0.92
TOTAL $11.0 $7.77 $12.3 $9.38 $10.1 $7.06
ANNUAL COST OF WATER (in Millions 2012 Dollars)
Capital Recovery
3
$12.0 $10.1 $9.24 $7.77 $11.0 $9.34
Total Annual Cost $23.0 $17.9 $21.5 $17.2 $21.1 $16.4
Production Cost of Water ($/AF) $2,555 $3,250 $2,395 $3,120 $2,345 $2,980
1
Includes implementation costs at 25%; ROW easement and land costs, mobilization/demobilization at 2%; electrical and I&C systems at 18%; engineering
and startup at 15%; and additional project proponent prescribed costs. All percentages applied to plant facilities costs.
2
Calculated as 1.5% of plant facilities costs.
3
Capital recovery factor based on an interest rate of 4.0% and term of 30 years.

Specific considerations related to the costs for each candidate project are provided below.
Page 5-5
A summary of our estimate of capital system costs to that provided by Cal-Am is provided in
Table 5-3. For the most part, the two estimates align fairly closely. A discussion of individual
elements is presented below.

Table 5-3 Summary of Cal-Am Capital Cost Evaluation
Cost Element
Cal-Am
1
Evaluated
1
9 kAFY 5.5 kAFY 9 kAFY 5.5 kAFY
Intake/Outfall $37.0 $31.7 $37.0 $31.7
Pretreatment & Residuals Handling $9.71 $8.52 $10.6 $7.94
Desalination System $27.9 $19.2 $22.3 $15.1
Post-Treatment $1.25 $1.09 $1.48 $0.88
Distribution $17.0 $16.0 $17.0 $16.0
Site Structures $11.5 $10.8 $11.5 $10.8
System Subtotal $104 $87.3 $100 $82.4
Plant Facilities (PF) Subtotal
2
$81.1 $64.1 $76.7 $59.1
Indirect Costs
3
Implementation Costs (25% of PF)
ROW, Easement and Land Costs
Mobilization/Demobilization (2% of PF)
Electrical, I&C Systems (18% of PF)
Engineering/Startup (15% of PF)
Additional Proponent Prescribed Costs

$26.4
$6.20
$1.44
$15.4
$10.8
--0-

$26.4
$5.20
$1.21
$12.9
$9.03
-0-

$25.0
$6.20
$1.53
$13.8
$11.5
-0-

$25.0
$5.20
$1.18
$10.6
$8.86
-0-
Subtotal
4
$164 $142 $158 $133
Contingency Allowance (30%)
3
$41.2 $35.5 $47.4 $40.0
Mitigation Allowance (1%)
3
$1.60 $1.40 $1.60 $1.30
TOTAL $207 $179 $207 $175
1
All costs are presented in millions of 2012 dollars.
2
Plant facilities costs include the System Subtotal, less off site trenched pipelines.
3
Listed percent-cost factors apply only to the SPI developed cost estimates. Indirect costs, contingency, and mitigation allowances shown under
the Cal-Am estimates were provided by them and are presented accordingly without adjustment.
4
The listed subtotal includes both the sum of Indirect Costs and the System Subtotal.

We found general agreement with Cal-Ams proposed costs for components of their proposed
intake and outfall systems. The slant well installation cost is in line with estimates weve seen
elsewhere; and the corresponding pipeline estimates are very detailed for this level of project
development. For the pretreatment and residuals handling systems, we found generally close
agreementbut did independently adjust costs for the pressure media filters based on an
equipment quotation we received. We also provided relatively minor adjustments to their

Page ES-5-6
allowances for interconnecting piping, cartridge filters and chemical addition systems. For the
desalting system equipment, we priced components of the energy recovery system (isobaric
pressure exchangers and booster pumps) based on specific quotes from the manufacturer; and
priced the RO trains according to our own cost models similar to the other projects to provide a
consistent basis. We also developed our own estimates for the post-treatment system equipment.
For indirect costs, we did not find anything particularly objectionable; but did price factor-based
costs on the common percentage basis we established. Their cost for land and right-of-way
easements was found to be very detailed and comprehensive.
Overall, the relatively high cost of the Cal-Am system is most directly tied to the cost of their
proposed intake system; while DWD and PWM have proposed relatively low cost alternatives.
Our corresponding operating cost estimates are provided in Table 5-4.

Table 5-4 Summary of Cal-Am O&M Cost Evaluation
Cost Element
Cal-Am
1
Evaluated
1

Energy $6.11 $3.73 $5.83 $3.54
Chemicals $0.63 $0.39 $0.32 $0.19
Expendables $0.72 $0.49 $0.69 $0.45
Other
Operations & Maintenance Labor
Equipment Replacement (1.5% of PF)

$2.69
$1.61

$2.36
$1.25

$2.69
$1.50

$2.36
$1.23
TOTAL $11.8 $8.22 $11.0 $7.77
1
In our estimate we adjusted some assumed operating efficiencies of centrifugal pumps and
motors from 80 percent to 75 percent; increasing costs somewhat. However, we decreased the
projected average operating pressure of the first pass RO membrane feed pumps and energy
recovery booster pumps to provide a common assumption across the three projects. This had the
effect of lowering our overall energy estimate from that provided by Cal-Am. Our chemical cost
estimate is likewise lower, owing primarily to our lower unit cost factor for sodium bisulfite.
Overall, Cal-Ams projected O&M cost falls in the middle of the estimates for the three
proponent projectsa consequence of their higher energy cost directly tied to their more than 60
percent higher electrical rate. At an equivalent industrial rate of $0.08/kW-hr, annual energy
cost in our estimates would drop to $3.56 million/$2.16 million under each capacity alternative;
for a reduced cost of production of $2,305/AF at 9,000 AFY and $3,000/AF at 5,500 AFY.

Page 5-7

We have summarized our estimated capital cost of the DWD treatment facility in relation to
costs prepared by DWD in Table 5-5.

Table 5-5 Summary of DWD Capital Cost Evaluation
Cost Element
DWD
1
Evaluated
1

Intake/Outfall $2.25 $1.38 $2.71 $1.66
Pretreatment & Residuals Handling $16.7 $11.6 $11.2 $7.94
Desalination System $17.2 $11.5 $19.4 $13.2
Post-Treatment $2.41 $1.57 $1.48 $0.88
Distribution $36.6 $35.0 $29.0 $28.9
Site Structures $4.13 $2.63 $3.65 $2.52
System Subtotal $79.3 $63.7 $67.4 $55.1
2
$45.4 $30.6 $39.1 $27.9
Indirect Costs
3

$13.5
-0-
$0.77
$6.18
$9.27
$18.3

$10.3
-0-
$0.47
$3.77
$5.65
$15.1

$16.9
$5.68
$0.78
$7.04
$5.87
$18.3

$16.9
$5.68
$0.56
$5.01
$4.18
$15.1
Subtotal
4
$127 $99.0 $122 $102
3
$9.27 $5.65 $36.6 $30.8
3
-0- -0- $1.20 $1.00
TOTAL $136 $105 $160 $134
1
2
3
the DWD estimates were provided by them and are presented accordingly without adjustment.
4
The increased cost of our estimate is largely due to the addition of a 40 percent capacity second
pass RO system to their facility. We also increased cost of the intake and other trenched offsite
pipelines to account for tunneling beneath the Elkhorn Slough at $1,500/LF. Crossing the slough
will likely be difficult and may have a higher cost, but we lack information to at this stage of
assessment to provide a more detailed analysis. DWD also appeared to use higher unit cost and
installation factors than we employed; but then a comparatively low contingency allowance of 12
percent.

Page ES-5-8
It is also worth considering that the proposed DWD facility is a regional project with a build out
capacity of 25,000 AFY. Intake and brine disposal pipelines are sized for the ultimate plant
capacity; and the totals listed in the DWD and SPI estimates for these items as well as site
facilities represent a flow based proration. DWD also prorated equipment costs for the 5,500
AFY plant alternative off their costs developed for the 9,000 AFY plant (9.1 mgd capacity);
while we developed separate equipment and facilities estimate for the 5.0 mgd and 8.2 mgd plant
sizes.
Lastly, the DWD cost for the intake system is limited to the pipeline from MLPP to the Capurro
Ranch site. Specifically omitted are the new 48-in deep water intake pipeline, modifications to
the MLPP intake pump station, and the proprietary warming system equipment. According to
DWD, the costs for these facilities will be borne by a separate entity/project and provided to
DWD for use as part of the regional desalination facility, subject to an annual lease (accounted
for in the O&M cost estimate). This accounting is largely the reason for the low capital cost
associated with the DWD in relation to the Cal-Am and PML projects. It does however result in
a higher O&M cost, summarized in Table 5-6.

Table 5-6 Summary of DWD O&M Cost Evaluation
Cost Element
DWD
1
Evaluated
1

Energy $2.68 $1.62 $3.93 $2.41
Chemicals $0.51 $0.31 $0.83 $0.50
Expendables $1.31 $0.89 $1.02 $0.68
Other
Other Proponent Expenses

$2.85
$1.11
$0.93

$2.60
$0.67
$0.64

$2.85
$2.69
$1.01

$2.60
$2.36
$0.83
TOTAL $9.39 $6.73 $12.3 $9.38
1
Overall we project a higher energy cost estimate for the DWD project based on an assumed
energy rate of $0.08/kW-hr throughout; where DWD appears to have used a $0.04/kW-hr rate for
some of their on-site facilities. The projected cost of chemicals is higher in our estimate as well,
as DWD omitted accounting for the cost of post-treatment chemicals in their estimate (calcite,
carbon dioxide and sodium hydroxide). Our cost of expendables however is reduced, based
largely on what appears to be a lower unit cost factor with the RO process membranes, even
including the additional membranes associated with the second pass RO system. Included in the
category of Other Proponent Expenses for Cal-Am are the annual lease costs associated with
their plant site and intake facilities; including other unspecified DWD engineering and
administrative fees. This category of expense has the effect of raising their overall annual costs
to the highest among the three project proponents on an equivalent basis.

Page 5-9
The results of our capital cost evaluation of the PML project are presented in Table 5-7.

Table 5-7 Summary of PML Capital Cost Evaluation
Cost Element
PML
1
Evaluated
1

Intake/Outfall $3.00 $3.00 $3.00 $3.00
Pretreatment & Residuals Handling
2
See Note 2 See Note 2 $20.2 $13.6
Desalination System
2
$56.0 $28.0 $19.9 $14.0
Post-Treatment
2
Distribution $22.0 $22.0 $22.4 $22.3
Site Structures $10.0 $7.00 $10.0 $7.00
System Subtotal $91.0 $60.0 $77.2 $61.0
3
$66.0 $35.0 $52.1 $35.9
Indirect Costs
4
$42.0
See Note 4
$21.0
See Note 4

$19.3
$30.2
$1.04
$9.38
$7.82
$0.20

$19.3
$30.2
$0.72
$6.47
$5.39
$0.20
Subtotal
5
$133 $81.0 $145 $123
4
4
-0- -0- $1.50 $1.20
TOTAL $133 $81.0 $190 $161
1
2
PML supplied costs for Pretreatment/Residuals Handling, Desalination System, and Post-Treatment were provided as a single lump sum and are
presented here accordingly.
3
4
the PML estimates were provided by them and are presented accordingly without adjustment.
5
PML presented their costs for the main treatment facilities as a lump sum number, making
comparison of individual equipment estimates impossible. That said, the respective totals
however closely match. The disparity between the estimates at the 9,000AFY alternative is
likely due to the difference in system capacity assumed9.4 mgd for PML 8.2 mgd in our
estimate.
PML provided an allowance of $3.0 million for repair and upgrade to their existing intake pump
station and outfall pipeline. We have no basis at this stage to recommend a higher estimate, but
do note that a comprehensive evaluation of the current state of the outfall pipeline and attendant

Page ES-5-10
repair requirements is not available at this time. It may be that when such evaluations are
conducted, the price could increase.
PML also provided single lump sum costs for indirect expenses, including project contingency
allowances. We find these allowances insufficient for a project at this stage of development with
significant undefined issues. PML still intends to validate their treatment approach through a
planned pilot testing program, making reliance on estimates prepared on the current process
design questionable. We also point out that the indirect and contingency allowances applied are
uniform across our evaluation for the three projects. PML does have a high cost associated with
ROW, land and easement allowances. This is a combination of the prescribed $25 million cost
of the MLCP 25-acre site and related facilities, along with a roughly $5 million dollar allowance
for ROW and easements associated with the product water pipeline.
Overall the PML facility capital costs fall in the middle of the three proponent projects; and
notably higher than the DWD estimate which shares comparatively low intake and outfall system
costs in comparison to Cal-Am. The primary reason for this is their expanded pretreatment
system, including both media filtration and MF/UF treatment to treat the supply extracted from
the Moss Landing harbor.
The results of the O&M cost evaluation are presented in Table 5-8.

Table 5-8 Summary of PML O&M Cost Evaluation
Cost Element
PML
1
Evaluated
1

Energy $4.46 $2.23 $4.20 $2.56
Chemicals $1.32 $0.66 $0.93 $0.57
Expendables $0.79 $0.39 $1.09 $0.65
Other

$0.94
$1.33

$0.94
$0.81

$2.69
$1.16

$2.36
$0.92
TOTAL $8.84 $5.03 $10.1 $7.06
1
All costs presented in millions of 2012 dollars
.
Overall our estimates closely match those provided by PML; with any differences attributed
primarily to the differences in the 9,000 AFY plant design capacity assumption discussed above
along with the addition of a second pass RO system to their process. The projected operating
costs of the PML system are the lowest of the three proponents.
MONTEREY PENINSULA REGIONAL WATER AUTHORITY IMPLEMENTATION CONSIDERATIONS
Page 6-1
6 IMPLEMENTATION CONSIDERATIONS
Each of the projects has been evaluated in terms of the major issues it faces for environmental
compliance and permitting, and the consequences for the development schedule. The evaluation
was performed at a very high level and based upon conceptual rules of thumb. In order to screen
the issues of significance, the prior Coastal Water Project EIR
22
was reviewed and largely relied
upon to assess facts and mitigation strategies for environmental compliance. That document was
presumed to have identified the relevant permits for prior project approaches.
Based upon our judgment, the major differences between the three proposed projects and the
alternatives described in the Coastal Water Project EIR were assessed to determine the additional
major permits that would need to be obtained and the new environmental assessments that would
be necessary. Each of the project sponsors provided estimates of the schedule for
implementation including the estimated timing for environmental compliance and major permits.
The conceptual schedule and schedule risk identified by the Consultants were reviewed with the
project sponsors for comment in an effort to present consensus on the project schedule and risks.
Although the prior EIR identified more than 25 discretionary approvals which must be obtained
for the project alternatives, this review focused on a simplified list of discretionary approvals
based upon our judgment that these approvals would most likely dictate the critical path for
project development.
Approvals related to intake of seawater
Approvals related to project discharge
Jurisdictional permitting for water of the U.S.
Coastal Development Permitting
Moreover, a highly simplified list of tasks for environmental compliance was created around
these discretionary approvals. Those tasks in order:
1. A project description must be completed.
2. An Environmental Assessment must be made.
3. An EIR/EIS must be completed (CEQA/NEPA compliance).
4. Commercial Agreements must be negotiated/ Cal-Am must obtain a Certificate of Public
Convenience and Necessity (CPCN), after certification of the EIR.
5. Jurisdictional Permits must be obtained for facilities impacting Waters of the U.S.
6. NPDES Permits must be amended/obtained.
7. Coastal Development Permits must be obtained.

22
California American Water Company, Coastal Water Project, Final Environmental Impact Report, October 30,
2009
IMPLEMENTATION CONSIDERATIONS MONTEREY PENINSULA REGIONAL WATER AUTHORITY

Page ES-6-2
The prior EIR found that two methods of intake of seawater would not cause a significant impact
on the marine environment:
1. The use of a subsurface intake was presumed to cause no adverse impact to the marine
environment.
2. The use of discharge from the MLPP would not cause an increased use of water from the
marine environment, and thus would not cause an impact as long as the power plant
continued to use once-through cooling.
The Prior EIR similarly found that there was no significant impact to the marine environment
under two proposed methods of brine discharge:
1. The blending of waste products (primarily waste brine) with the MLPP discharge would
sufficiently dilute the discharge to avoid significant impacts.
2. The use of the MRWPCA ocean outfall would cause sufficient mixing of the waste brine
and other products to avoid significant impacts.
With regard to financing risk as it applies to proceeding with at-risk design development
activities, we have not reviewed the extent to which the project sponsors have investors that are
willing to shoulder financial risks associated with development of the proposed desalination
projects. For any project to be successful there must be financial backing sufficient to pay
development expenses prior to the issuance of major permits and the execution of definitive
commercial agreements for project implementation.
We have developed project implementation schedules for the project based upon an assumption
that investors assessment of contingent risks would not delay logical development activities that
affect the critical path for project implementation. For example, it has been assumed that all of
the projects could proceed with preliminary design and definition of engineering parameters
through activities such as pilot testing prior to the issuance of major permits, even though there is
substantial financial risk to these endeavors. Thus the schedules could be overly optimistic when
considering these financial risks.
The implementation path for the Cal-Am proposal is very well defined. Moreover, the CPUC is
aggressively pushing forward implementation of the project. The CPUC has published a
schedule for completion of the EIR and CPCN for the project. Cal-Am has provided an
estimated schedule for implementation of the project following the CPCN.
The Notice of Intent (NOI) issued by the CPUC indicates that a Subsequent EIR is being
prepared. Following Scoping Hearings on October 25 and 26, a Scoping Report will be
prepared describing the project and the project alternatives that will be considered in a Draft EIR
scheduled for circulation July 1, 2013. The Scoping Report will describe alternatives to the Cal-
Am project prior to the CPUCs hearing testimony on the proposed CPCN. Hearings will be
concluded prior to the issuance of the Draft EIR. The Final EIR will be issued prior to final
approval of the CPCN. Although it is unusual for the administrative process for CPCN to
precede the issuance of at least a draft EIR, the CPUC found that it was not in the publics
interest to delay the CPCN proceedings because it would risk non-compliance with the 2016
State imposed deadline to reduce diversions of Carmel River water.
Page 6-3
The risks affecting the Cal-Am development schedule have been carefully evaluated and the
professionals working on compliance for Cal-Am and the CPUC are exceptionally capable.
Descriptions of contingent risk for the project should be viewed in a context that all development
options have unresolved risks, and that it is not possible to define a perfect path which balances
the competing objectives of all parties. Moreover, there are a number of legal uncertainties
related to the path of development that can be assessed but not resolved at this time.
One legal question regards the structure of commercial agreements for the desalination project.
The Cal-Am proposal depends upon the CPUC acting as lead agency for environmental review
which is apparently appropriate only when Cal-Am would own and operate the facilities of the
desalination project. As noted below, there are conceptual advantages to public ownership of the
assets for a project of this type, which may significantly enhance the prospects for political and
legal approvals necessary for the project to succeed. Thus there is something of a conundrum for
the MPRWA--the CPUCs legal authority and sophistication to act as a lead agency for CEQA
creates a schedule advantage. Moreover, the simplicity of the commercial agreements when Cal-
Am owns all facilities creates schedule advantages in the CPCN administrative process, but that
ownership structure creates contingent risk and political opposition to the project which could
delay ultimate approval.
Separate from these political considerations, the primary risks for schedule delay appear to be
related to uncertainties for the development of slant wells as intake for the proposed project.
Those risks are further broken down:
1. There are questions regarding the legal right of Cal-Am to install and operate slant wells in
the proposed locations.
It appears that there are paths to resolve this issue through commercial agreements with other
entities which do have a clear legal right to install wells. How these issues are resolved is
considered too speculative to be presented.
2. Design of the intake system and to a lesser extent the treatment system depends upon results
from a well testing program that is not completed. That leads to uncertainty in the design
which could change the project description and affect the schedule for CEQA/NEPA
compliance. Moreover, Coastal Development Permits are needed both for the installation of
test wells and for the ultimate intake system, which adds to uncertainty regarding when the
system can be fully described.
Perhaps the biggest risk to schedule is the potential that the results of a well testing program
were to change the design of the intake system compared to the project description uses in
CEQA documents, resulting in a change of significance such that the CEQA process would
be substantially reset. It appears that Cal-Am has conservatively estimated the yield of the
slant wells and thus conservatively estimated the environmental effects of the proposed
intake system. However, Cal-Am has described some potential for the test well program to
warrant a change from slant wells to Ranney style collectors which would require analysis in
the CEQA documents of this option.
3. The nature of approval from NOAA for the installation of intake facilities is uncertain. It
appears likely that approval is discretionary and would require compliance with NEPA. The
administrative process for approval and the uncertainty of the outcome causes some schedule
risk.

Page ES-6-4
The potential installation of Ranney collectors as an alternative to the slant well intake
system would require discretionary approval of the NOAA. Environmental reviews in
support of such an approval would have to comply with NEPA. Moreover, NOAA has
verbally opined to the TAC that approval of even the slant wells may be of a discretionary
nature which requires NEPA compliance. Presumably this will be resolved during scoping
hearings, but the CPUC schedule for CEQA compliance may need to be adjusted if for
overall schedule considerations the process is adjusted to allow concurrent review of
environmental assessments under both CEQA and NEPA. Alternatively, if the CPUC elects
to base its approval schedule upon only CEQA compliance and ignore potential NEPA
compliance, it would add to the overall project schedule to have a separate environmental
review for the purpose of issuance of Federal Permits necessary for the installation of an
intake system.
There is a lesser risk associated with permitting the discharge of concentrated brine and other
waste products from the desalination treatment process. It is possible that questions regarding
the adequacy of the mitigation via blending brine with the receiving waters may be raised. It is
also possible that legal questions regarding the path for regulatory approval under the distributed
authority of the NPDES program could delay the issuance of brine disposal permits.
The other primary source of schedule uncertainty and risk for the Cal-Am project, identified by
Cal-Am appears to be related to the California Coastal Commissions approval of a Coastal
Development Permit for the full-scale project. The Coastal Commission would normally act
after Certification of Environmental Compliance and after all other permits have been obtained.
Two sub-questions have been identified as unresolved.
1. What is the process and timeline to issue Coastal Development Permit for the test wells?
2. What is the timeline for issuance of Coastal Development Permit for the ultimate intake
system?
The first question primarily is a process question. There needs to be CEQA review of the test
well program. Potentially other permits need to be issued and then the Coastal Commission
needs to meet and approve the application.
Although the CPUC has considered the issue of whether Cal-AM can finance the test wells, the
timeline to obtain permits, install the test wells and incorporate the results from the test wells
into the overall project development plan is not fully defined.

The second question also causes some uncertainty as to the timeline. As pointed out by RBF,
issuance of significant permits, culminating in a Coastal Development Permit can take as little as
4 months following certification of CEQA to more than 5 years with a highly controversial
project.
Perhaps two primary questions of interest to the California Coastal Commission are:
1. Has the project been designed to protect and enhance the Coastal and Marine
Environment?
2. Does adequate public oversight of the intake system and the dependent seawater
desalination project exist to adequately protect the public trust values for the coastal
environment under California law?
Page 6-5
The extent to which these questions are adequately addressed during CEQA review and the
issuance of a CPCN by the CPUC may largely determine the timeline for issuance of a Coastal
Development Permit.
Based upon the CPUC schedule for CEQA compliance and CPCN and the minimum likely
schedule for issuance of major permits thereafter, we have prepared a conceptual implementation
schedule for the Cal-Am project as presented on Figure 6-1:
Figure 6-1 Conceptual Implementation Schedule for the Cal-Am Project

The above schedule presumes no delays to the design and construction of the desalination plant
based upon development of the intake systems. Also, no project delays are assumed to be
associated with obtaining project financing. It is presumed that project financing would be
needed prior to major construction activities but would not delay design or test-well activities.

DWD presented a schedule identifying their major milestones for project implementation. The
schedule presented and the discussion of permitting by the DWD team displays a sophisticated
understanding of the likely process and pitfalls associated with completing environmental review
and obtaining major permits for the proposed desalination project. The schedule presented
would presume that the major permits (last being the Coastal Development Permit) would be
issued about the middle of the third quarter of 2013. This is based upon a schedule that is much
more optimistic than the generic schedule we developed as shown on Figure 6-2.


Page ES-6-6
Figure 6-2 - Conceptual Implementation Schedule for the DWD Project

The Generic Schedule above represents a delay in project implementation of more than 34
months compared to the schedule developed by DWD. This major difference is examined
below.
DWD has suggested that an Environmental Checklist and Applicants Environmental
Assessment (EA) are very nearly completed. Based upon DWDs demonstrated understanding
of the process for environmental review of the project, the Consultant has accepted this
assurance although the completed EA has not been reviewed.
DWD has presumed a schedule for their EIR/EIS of nine months from the completion of an EA.
Given the level of controversy for the installation of a new seawater intake and the potential
construction of a new facility for brine discharge, it seems likely that the period for scoping
hearings, preparation of a draft EIR/EIS and the adjustment of the project analyses would take
much longer. In the above schedule the Notice of Determination (NOD) for the EIR/EIS would
take place approximately 3 months later than the NOD issued by the CPUC for the Cal-Am
project which is based upon a Subsequent EIR process. The proposed schedule for a new
EIR/EIS is comparable to the schedule adopted by the CPUC.
Our schedule also adds four months for the issuance of a CPCN for CalAms participation in the
project. It is possible that this process could run concurrent with other processes to obtain major
permits. But for conservatism this is shown as a critical path activity.
The schedule presumes a 12 month process for obtaining Jurisdictional Permits for facilities
which are impacting the Elkhorn Slough. The process to obtain Section 404 permits from the
U.S. Army Corps of Engineers would take place after issuance of a Notice of Determination for
the EIS. A 404 permit appears to be required for construction of new pipelines crossing the
Elkhorn Slough to connect the desalination plant to the intake and discharge facilities of the
Moss Landing Power Plant and to convey product water from the desalination plant to the
CalAm system. It is quite speculative to assess how long that process would actually take. The
Corps would consult with U.S. EPA and EPA would likely take some time to review the project
given both the nature of temporary construction impacts and due to potential concerns regarding
indirect impacts of the project upon the Elkhorn Slough. The 12-month period for issuance of
this major permit is based upon a presumption of some controversy for the project and a
presumption that the Elkhorn Slough is a wetlands area of national significance.
Our schedule further presumes that the issuance of NPDES permits for the intake and discharge
would follow the issuance of Jurisdictional Permits. This is based upon an assumption that the
Page 6-7
RWQCB would not review the permits until final approvals had been given for all construction
which affected the intake and discharge. Thus, permits to construct the intake and brine line
would have to be in hand prior to conducting the administrative process for issuance of NPDES
permits. The RWQCB process for issuance of permits has proven to be an administrative
process surrounded by controversy. Thus it is quite speculative to assess a time frame for
issuance of these permits.
The schedule includes six months for the issuance of a Coastal Development Permit by the
California Coastal Commission. The Coastal Commission would consider this permit only after
the EIR/EIS had been certified and all other major permits have been issued. The process for
issuance of this permit in a highly controversial project sponsored by Poseidon Resources in
Carlsbad, California took many years following certification of environmental documentation.
The assumption of six months for this process is based upon an assumption that there would be
some contention of facts during the administrative process to issue this permit but that the prior
extensive review would have resolved these issues. Nonetheless the time period for issuance of
this permit is highly speculative.
PML has presented a report by SMB Environmental describing the general path for
environmental review, permitting, and commercial agreements which are key to implementing a
proposed project. The report does not present a detailed schedule for implementation. However,
the report offers general insights into the approach to project implementation. Based upon
generalized rules of thumb we endeavored to estimate a project development schedule.
Two major issues were identified related to a project description and Environmental Assessment
for the project:
1. Assessment of the impacts of seawater intake.
2. Assessment of the impacts of brine discharge.

6.3.1 Assessment of Impacts of Seawater Intake
With respect to how the project would assess the impacts of the projects proposed use of
seawater, PML has proffered that as a matter of law, the proposed desalination projects use of
seawater from the intake in Moss Landing Harbor should be compared to the 60 MGD use that is
currently permitted for the Moss Landing Commercial Park. Thus it is presumed in the SMB
report that the intake of seawater for the desalination project would not increase the take of water
from the marine environment. As such, the projects use of seawater could have no adverse
impact upon the environment. In the schedule below, we have taken a different view and
presumed that the projects proposed use of seawater would be compared to a no-project
alternative in which seawater would not be used. Thus an assessment would have to be made of
the potential impacts of use of seawater. This would include baseline monitoring and complex
modeling to determine the impingement and entrainment impacts of use of the intake. If PML is
correct and for purposes of the Environmental Assessment, EIR/EIS and Coastal Commission
Permitting, the project be presumed to use no water from the marine environment compared to
the existing no-project alternative, then completion of the Project Description and Environmental

Page ES-6-8
Assessment phase of work could be substantially shortened from what is presented and shown on
Figure 6-3.
Figure 6-3 Conceptual Implementation Schedule for the PML Project

It is important to note that in the schedule presented above, the time for Project Description and
Environmental Assessment phases presume that a detailed assessment of the projects potential
impingement and entrainment of marine organisms would have to be made. In this regard it is
significant to note the prior findings of fact by the Regional Water Quality Control Board made
relative to the existing NPDES permit for the Moss Landing Commercial Park (Order R3-2009-
0002, Permit CA000705). Based upon a volumetric approach that compared the Moss Landing
Cement Plant Project to previous 316(b) studies at the adjacent Moss Landing Power Plant, the
RWQCB found that use of up to 60 MGD of seawater through the existing intake structure in
Moss Landing Harbor would have negligible potential impingement and entrainment impacts.
Thus it is also possible that the project may avoid detailed assessments of the potential impacts
of use of seawater and rely instead upon prior work to determine that the use of seawater would
not cause a significant impact upon the marine environment.

6.3.2 Brine Discharge
PML has described a near zero liquid discharge treatment system that would substantially
reduce volumes and potential impacts from brine discharge. But that process is not described. It
is thus not possible to independently assess potential impacts from the proposed discharge of
brine. This leads to a great deal of uncertainty with respect to our assessment of the plan for
implementation. A discharge which would require construction of a new discharge structure
could take substantially longer than the generalized schedule below, a discharge that would by
observation have no potential impact upon the marine environment would take substantially less
time than shown in the schedule.
Although it is possible to make a generalized assessment of the PML project plan for
implementation as described above, that generalized schedule is not directly comparable to the
analysis that is possible with the Cal-Am project which has a detailed project description and an
environmental assessment which has already been subject to public review in a prior EIR. It is
highly likely that as the more detailed project description is developed and Environmental
Assessments are completed, controversial issues will arise that will require re-assessments and
analyses which will delay processing of the environmental compliance documents and major
Page 6-9
permits. In the Cal-Am project those issues are well understood and the potential areas of
controversy are well documented.
MONTEREY PENINSULA REGIONAL WATER AUTHORITY REFERENCES
Page 7-1
7 REFERENCES
1. RBF Memorandum, Recommended Capacity for the Monterey Peninsula Water Supply
Project (MPWSP) Desalination Plant, April 20, 2012.
2. SPI Memorandum, Monterey Desalination Study Initial Scoping and Constraints Analysis,
August 30, 2012.
3. Direct Testimony of Richard C. Svindland Before the Public Utilities Commission of the
State of California, filed April 23, 2012.
4. RBF Memorandum, Monterey Peninsula Water Supply Project (MPWSP) Project
5. Cal-Am Response to SPI Questions, October 3, 2012.
6. Williams, D.E. Design and Construction of Slant and Vertical Wells for Desalination
Intake. IDA World Congress-Perth Convention and Exhibition Centre (PCEC) Perth,
Western Austrailia September 4-9, 2011 REF: IDAWC/PER11-050.
7. Pankratz, T. A Review of Seawater Desal Intake, Pretreatment & Discharge Technologies.
IDA Iran 06 WDTS Proceedings September 17 & 18, 2006.
8. Ghiu, S. 18 Month Demonstration of Slant Well Intake System Pretreatment and
Desalination Technology for Seawater Desalination. WaterReuse Research Conference
Proceedings, June 2012.
9. Trussel Technologies Inc. Technical Memorandum, MRWPCA Outfall Hydraulic Capacity
Analysis, April 18, 2012.
10. DWD Response to SPI Questions, September 12, 2012.
11. Cartier G., Corsin P. - Description of Different Water Intakes for SWRO Plants. IDA World
Congress-Maspalomas, Gran Canaria Spain October 21-26, 2007 - REF: IDAWC/MP07-
185.
12. DWD Response to SPI Questions, September 8, 2012.
13. Tenera Environmental, Preliminary Modeling of Potential Impacts from Operation of a
Desalination Facility Ocean Intake, August 22, 2012.
14. Replacement Cost Approaisal Summary Report, prepared by Landmark Realty Analysts,
Inc., October 3, 2011.
15. Structural Evaluation, Intake & Outfall Pipelines, Intake Pump Station and Water Storage
Reservoirs, The Peoples Moss Landing Water Desalination Project, Moss Landing Green
Commercial Park, Modd Landing, CA, August 14, 2012.
16. Monterey County Planning & Building Inspection Department; Meeting September 30, 2004,
Agenda Item 6.
17. Coastal Water Project Pilot Plant Report, May 2010, MWH.
18. Outfall Video, Moss Landing Marine Lab, California State University.
REFERENCES MONTEREY PENINSULA REGIONAL WATER AUTHORITY

Page ES-7-2
19. Seawater Outfall for Kaiser Aluminum and Chemical Corporation, Moss Landing,
California, by Kaiser Engineers, 1971.
20. RBF Memorandum, Monterey Peninsula Water Supply Project (MPWSP) Project
21. Presentation Monterey Peninsula Water Supply Project Presentation to Monterey Co.
Water Resources Agency, June 25, 2012.
22. California American Water Company, Coastal Water Project, Final Environmental Impact
Report, October 30, 2009.


Evaluation of Seawater Desalination Projects by SPI November 2012

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