Ratepayer group challenges Monterey desalination approval

California's Division of Ratepayer Advocates (DRA) has appealed against the approval of the Coastal Water Project on the Monterey peninsula, stating that the state Public Utilities Commission (CPUC) surrendered its oversight responsibilities to the promoters of the project, which includes a seawater desalination plant.

In December 2010, CPUC approved the regional water project, which has been proposed by California American Water (Cal-Am), the Monterey County Water Resources Agency and the Marina Coast Water District. The proposal, which still needs several other approvals, including a permit from the state Coastal Commission, would build a 37,850 m³/d seawater desalination plant.

In its appeal, the DRA argues that the commission's approval of the project agreement "unlawfully delegates" the CPUC's own obligation to ensure Cal-Am's rates are reasonable for Peninsula customers. It also argues that the approval unlawfully "places the burden" of monitoring the project on Cal-Am and its customers.

The DRA also alleges several factual errors in the commission's approval. The project partners have 15 days to respond to the appeal, after which the commission can decide whether to grant or deny the request for a rehearing, or propose modifications to the project agreements.

DRA water division supervisor Diana Brooks told the Monterey County Herald on 7 January 2011 that the commission was not legally allowed to cede its responsibilities to other entities, public or private. Brooks said project and cost oversight was now essentially the responsibility of the partnership.

"By not reviewing (project) costs for reasonableness, the commission is essentially accepting that the costs will be reasonable whatever they are," Brooks said. "We're talking about rates that could potentially triple, and that's a big deal."

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