Christopher Neely here, watching another private desalination effort get underway in Monterey County.
Algonquin Power and Utilities Corp., a Canada-based, publicly traded company worth $11 billion, is proposing to build a brackish water desalination plant in Moss Landing through its subsidiary, Liberty Power. The project proposes to drill a series of wells in the 180/400-foot aquifer subbasin and, through extraction and desalination, produce enough clean water to solve North County’s seawater intrusion issues caused by over-pumping the aquifers.
The proposal is still very much in its nascent stages. Liberty Power still needs to conduct hydrological studies to test the environmental feasibility of such a project, and multiple North County water distribution agencies and companies would need to agree to buy the water. These steps offer no guarantees.
However, none of that will happen unless there is the political will to amend a 32-year-old Monterey County law requiring any and all new desalination plants be publicly-owned. Despite the fraught politics in the county around private ownership of water resources, Monterey County Supervisor John Phillips on July 27 proposed the county change the law.
“I don’t know why we ever passed that. As far as I can tell, we may be the only county that has such a law,” Phillips tells me. “In 1989, we said, ‘We think this is the way to go.’ Here we are, 32 years later, and we’ve yet to have any public agency step up and come up with a desalination plant. I think you need private enterprise to step up and do these things.”
Phillips wants to see what the Liberty Power project can offer but the company will not move forward with the necessary studies unless they know the plant is something they can legally build. Kim Adamson, Algonquin’s director of business development for water in North America, told the Marina Coast Water District’s board of directors on Monday, Aug. 2 that she doesn’t believe the county’s law would hold up.
County staff is reviewing the possible amendment change. If the Board of Supervisors votes against an amendment, it’s likely we could see a legal challenge. However, the legal question does not answer the wider political one: should we be allowing a publicly-traded company with a profit motive to own a resource as vital to the public as water?
Private ownership in and of itself is not a bad strategy, says Michael DeLapa, executive director of local land use watchdog LandWatch. However, things get problematic when the incentives of the company skew from the public’s interest.
“Private can work well if you have the right private actors and what’s driving the profits is what is in the public’s interest. If the profits are generated by providing the least costly solution that is the most environmentally sustainable, then you can imagine the public and private interests are aligned,” DeLapa says. “When those things are off kilter, you get high rates, climate and environmental issues and over-capitalization.”
DeLapa says when a private company has a monopoly over a resource with no market competition, such as Liberty Power would have in this case, the line between public and private interests becomes more vulnerable. It becomes easier for the company to drift from the public’s interests because the public is limited in its options. On the Peninsula, private utility California American Water drifted far enough from the public interest that voters famously supported a public buyout, a complicated and expensive process that is currently underway.
None of this, however, happens without an ordinance change at the county level. The Monterey County Board of Supervisors are expected to revisit the question when they reconvene in September. It will be something to watch.