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Home My WebLink About2018-07-10; Municipal Water District; ; San Diego County Water Authority calendar year 2019 rates and charges.Environmental Evaluation (CEQA) Receiving a report does not qualify as a "project" under the California Environmental Quality Act (CEQA) per State CEQA Guidelines Section 15378, as it does not result in a direct or reasonably foreseeable indirect physical change in the environment and therefore does not require environmental review. Public Notification This item was noticed in accordance with the Ralph M. Brown Act and was available for public viewing and review at least 72 hours prior to the scheduled meeting date. Exhibits None. / July 10, 2018 Item #13 Page 2 of 2 City of Carlsbad City Council Meeting July 17, 2018 Dan Denham Assistant General Manager San Diego County Water Authority Our Region's Trusted Water Leader 2019 San Diego County Water Authority Rates and Charges 2 Background: 1991-1992 31% cutback at MWD = 31% cutback to the Water Authority 95% 5% •MWD • Surf ace Water State to Shut Off water Oe\ivetY to southland 3 Diversification Efforts $$ Quantification Settlement Agreement Recycled water pipelines Claude "Bud" ~ ,Carlsbad Desalination Plant J Pure Water ( SA, JIEGO Advanced Water Purification Eaat: Cuur Ly 9%34% 13% 3%9%12% 6% 9% 5% MWD IID Canal Lining SLR Wheeling Recycled Seawater Desal Groundwater Surface Water Potable Reuse 40% 21% 16%5%8% 3%5% Water Authority Supply Mix 2009: 13% cutback at MWD = 8% cutback to the Water Authority 2015: 15% cutback at MWD = 1% cutback to the Water Authority 2017 2025 • • • /JJ,,.. Our Region's Trusted Water Leader ~ San Diego County Water Authority • • • • • • 5 Water Sales Demand Forecast Ramp-up of Quantification Settlement Agreement deliveries MWD Rates and litigation Utilization of the Rate Stabilization Fund 2019 Rate and Charge Drivers 6 Behavioral changes in water use 47% decline in per capita water use from 1990 to 2017 Landscape market transformation State actions SWRCB mandatory water use restrictions Governor’s emergency drought proclamation and Executive Orders Project slight reduction (4,000 AF) in Water Authority sales projected in 2018 Total water demand projected to increase by approximately 1.5% from CY 2018 to CY 2019 Water Sales Demand Forecast 0 50 100 150 200 250 300 TAFCanal Lining IID Water Transfer Ramp up of QSA Deliveries •• 11 8 No assumptions made on MWD rates outside of Appeals Court decision Court awarded damages of $44M for CY 2011-14 not applied to rate forecast Reduction of $12M in MWD costs in 2018 Net savings of ~$15M in CY2019 otherwise charged to QSA supplies negated a 7.5% increase in Water Authority QSA melded supply costs MWD Rates and Litigation Does not include fixed RTS and Capacity Charges, which are not recovered on the Melded Supply Rate MWD Represents 46% of the Cost of Water MWD Costs 18% MWD Exchange Agreement Costs 28%QSA Water Purchases 28% Desalination 24% Operational Storage 2% 9 MWD Remains Largest Share of Water Cost ® ,\~\~,;, Our Region's Trusted,Wate. r,Leader .~·\ .. ,.'I,_·;~ San Diego County Water/Authority (, :\, ... ~·,' '\ \\'°'·,~-~ CY 2018 CY 2019 CY 2020 All-in MWD Rate MWD Untreated Tier 1 Rate $ 209 $ 209 $ 208 Transportation 486 522 547 Readiness-to-Serve Charge 166 202 272 Capacity Charge 60 63 85 Total $ 921 $ 996 $ 1,112 QSA Melded Supply Rate QSA Supply $ 446 $ 474 $ 508 MWD Exchange 431 453 482 Total $ 877 $ 927 $ 990 Difference:($44)($68)($121) Estimate as of June 28, 2018 MWD vs. QSA Melded Supply ($/AF) ® ,\~\~,;, Our Region's Trusted,Wate. r,Leader .~·\ .. ,.'I,_·;~ San Diego County Water/Authority (, :\, ... ~·,' '\ \\'°'·,~-~ $147 $131 $108 $- $50 $100 $150 CY 2018 CY 2019 CY 2020 CY 2021 CY 2022 CY 2023 RSF Ending Balance Recommended Target Ending Balance Recommended Maximum Allowable Ending Balance 11 CY 2019 draw of $18.4M provides ~$49/AF or 3% of rate relief Forecasted Rate Stabilization Fund ($M) 25%20%20%15%15%15% --- Treated Water Costs* $1,603 $1,617 $1,000 $1,200 $1,400 $1,600 $1,800 $2,000 $2,200 $2,400 $2,600 CY 2018 CY 2019 CY 2020 CY 2021 CY 2022 CY 2023$/AFProposed CY 2019 Rate Updated Rate Guidance - High Updated Rate Guidance - Low 2015 LRFP Guidance - High 2015 LRFP Guidance - Low *Updated Rate Guidance reflects current MWD Rate Case outcome 0.9% CY 2019 Rate Increase -CY 2019 Rate -- •• •• •• ••• ••• ••• ••••• ••••• ••••• •• ••• -- •••• •••••• •••• •••••••• ••••••• ••••••••••••••• • ••• ••••••••••• ' .............. . $1,303 $1,341 $1,000 $1,200 $1,400 $1,600 $1,800 $2,000 $2,200 CY 2018 CY 2019 CY 2020 CY 2021 CY 2022 CY 2023$/AFProposed CY 2019 Rate Updated Rate Guidance - Low Updated Rate Guidance - High 2015 LRFP Guidance - Low 2015 LRFP Guidance - Low 13 *Updated Rate Guidance reflects current MWD Rate Case outcome 2.9% CY 2019 Rate Increase Untreated Water Costs* -CY 2019 Rate -- •• •• ••••• •••• ••• ••• ••• -- •••• •••••• •••••• ••••••• ••••••• • ••• •••••• ••••• 14 Our Region's Trusted Water Leader San Diego County Water Authority