Draft Trailer Bill 807 would expand the State Water Resources Control Board’s authority by allowing it to impose operating fees paid by public water systems. The state board would be required to adopt, by emergency regulation, “a fee schedule, to be paid annually by each public water system for the purpose of reimbursing the state board for specified activities.” The bill goes on to require the state board to also “set the total amount of revenue collected through the fee schedule to be equal to the amount appropriated by the Legislature.”

According to analysis from the Association of California Water Agencies, these changes “would repeal most of the existing fee program, including safeguards in existing law, and authorize adoption of a new fee schedule by emergency regulation.” Under existing law, fees for large water systems are determined by actual costs incurred in administering the program, such as a fee-for-service model.

ACWA notes the proposed trailer bill “would not require fees to be based on actual costs.” In fact, the new language “would remove the existing statutory cap on the base total for the fees and the existing cap on annual increases.” These additional fees charged to water agencies will likely be passed on as costs to ratepayers.

In a letter addressed to the members of the California state Senate and Assembly, ACWA and a number of other local water-regulating entities expressed their reservations about the language in TB807:

“The proposed trailer bill language, which would repeal most of the existing fee program, including safeguards in existing law, without sufficient financial context and authorize the adoption of a new fee schedule by emergency regulation is in stark contrast to the commitment of increased transparency and public participation as pledged to the water community when the Program was transferred last year to the SWRCB. …

 

“We have significant concerns related to the current language. Not only does the proposed emergency regulatory authority circumvent public process in raising fees on drinking water systems throughout the state, but many questions remain unanswered related to the Program’s financial structure that is being used as context for the proposal.”

A second proposal, draft Trailer Bill 825, would also broaden SWRCB’s authority, allowing the state board to mandate consolidation of public water systems, in the event that “a public water system fails to reliably provide an adequate supply of safe potable water.”

ACWA says this proposal “would authorize the State Water Board to require a public water system that fails to provide an adequate supply of safe drinking water to consolidate with another public water system.” Concern was expressed in a May 29 letter to the Joint Budget Conference Committee that the trailer bill skips the regular policy and fiscal committee process and “does not provide adequate time for stakeholder comment or public input.”

Aside from the lack of transparency, the proposal to give the state board authority to force consolidations is not an immediate fix to the current drought emergency, says ACWA. SWRCB would have the authority to consolidate “under a broad scope of circumstances,” despite the fact that “consolidations of water purveyors are complex and take time.”

California Special Districts Association also wrote a letter of opposition, stating TB825 would “grant the [state board] unprecedented unilateral power to take ownership and operation of a water system from one entity and force it upon another.” Water rights would be placed in jeopardy, the CSDA alleges, and the proposal “could upend these rights and create legal gridlock.” Ratepayers would also be exposed to unlimited liabilities by “taking on failing systems” in the costs of “environmental cleanup, regulatory penalties, vendor and employee claims and other legal and financial risks.”

Neither of these bills have been formally introduced in the Legislature but are listed on the Department of Finance website as part of budget trailer bill language.

Then Dynergy Energy announced last month it would decommission the Morro Bay Power Plant whose three tall smokestacks for 50 years have become almost as big a symbol of the city as its looming Morro Rock.

The plant is one of 19 gas-fired power plants along the coast of California, comprising 5,500 megawatts of power generation to be phased out of operation to protect marine life (see map here). The City of Morro Bay has proposed to permit a commercial and tourist redevelopment project on the power plant site.

The major reason for mothballing the power plant was its negative impact on marine life. Thousands of fish larvae got sucked into the power plant’s ocean water inlet.  However, mature fish could not get pulled into the inlet because each inlet tube is only 3/8-inch wide. 

Moreover, as in George Orwell’s “Animal Farm,” in California some animals are more equal — and valuable — than others. In line with the new priorities of renewable energy, fish seem to be more “equal” than birds and turtles.

For example, there were 34 reported bird deaths in Sept. 2013 attributed to BrightSource Energy’s 459-foot high tower that beams sunlight to thousands of surrounding mirrors at its Ivanpah solar energy project. Also threatened there: 2,325 juvenile desert tortoises.

But unlike fish on the scenic coast, the Ivanpah project is out of sight and mind, located 50 miles from the Salton Sea in the Mojave Desert.

No government agency has ordered an equivalent shutdown of the Ivanpah solar power plant.

Morro Bay Power Plant replaced by CA Valley Solar Ranch

Morro Bay is now getting power from the new California Valley Solar Ranch in eastern San Luis Obispo County.  This $1.6 billion, 250-megawatt solar farm comprises 749,088 solar panels covering 1,500 acres. Which means it costs an astronomical $6,400,000 per installed megawatt of energy, operating at a capacity factor of 22 percent.

By contrast, a natural gas-fired power plant, such as Morro Bay’s, would require one-fourth of the capital investment; would cost about $1,000 per megawatt installed; would be making four times the electricity at an 88 percent capacity factor; and would impact about 25 acres of land.  The California Solar Farm project is not economically feasible without large government tax credits.

It is estimated the power from California Valley Solar Ranch will cost ratepayers from $0.15 to $0.18 per kilowatt-hour. PG&E’s baseline electricity rate is $0.11 per kilowatt hour.

Starwood

Another option being considered by the city is to partner with Starwood Energy Group, based in Connecticut, to generate clean, renewable energy at the power-plant site.

Starwood’s Chairman is Barry S. Sternlicht, a registered voter in the Democratic Party. He also has been a prominent fund raiser and organizer for President Obama, former Secretary of State Hillary Clinton, Senate Majority Leader Harry Reid, former Vice President Al Gore, Former President George W. Bush and others.

Ironically, in 2009 Starwood already planned on building a large concentrating solar energy tower plant in Arizona like the Ivanpah solar plant in California.  But the idea for the project ended up being abandoned. According to Reuters, “Lockheed Martin Corp was the engineering, procurement and construction firm for the Starwood project. [Arizona Public Services] said Lockheed Martin decided not to go forward with the project due to the size and the final risk profile of the EPC contract, among other factors.”

This begs the question: If a solar farm were constructed on the site of the old Morro Bay Power Plant, would environmentalists try to shut it down for killing birds, not fish?