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An innovative approach to water management is positioning San Diego County as a national leader in drought resilience while creating opportunities for financial relief to local ratepayers.

Western states that rely on the Colorado River are facing worsening drought conditions. The river is currently at 30% capacity, its lowest level in history, threatening water and hydropower for 40 million people and 30 tribes. Yet, through decades of forward-thinking investments, the San Diego region has abundant water supplies.

“The Colorado River, I think you know it’s probably the worst that it’s been in the history of the river,” said Dan Denham, San Diego County Water Authority General Manager. “The weather is not going to wait for us any longer.”

Speaking recently to a meeting of the Albondigas San Diego Political Society, an informal civic organization, Denham outlined how an innovative mindset is ensuring water supply reliability and affordability.

Creative Solutions to Manage Water and Control Costs

With regional population growth leveling off and conservation lowering demand, Denham explained the Water Authority is finding new ways to manage its surplus water and generate a return on past investments.

A major turning point occurred when the agency resolved a 15-year litigation with the Metropolitan Water District of Southern California. This successfully repaired vital relationships and allowed the Water Authority to focus on consensus-building and collaborative transfers.

“Moving forward, we are fully engaged with Metropolitan in a different way, not questioning things just to question them, but to build consensus and find a path forward for Southern California,” said Denham.

This collaborative spirit led to 21-year agreements with two retail water agencies in Riverside County, stabilizing sales and bringing approximately $660 million to the Water Authority over the course of the contracts.

The financial return from these transactions has the potential to reduce costs for business and residential customers in San Diego County. Denham said at the July board meeting, he plans to recommend a three percent wholesale water rate increase to the Water Authority board of directors.

“We made generational investments that are absolutely paying off, and now we are being flexible with those generational investments,” said Denham.

He emphasized that the agency’s primary goal is to keep future wholesale increases aligned with inflation, providing essential breathing room for the region’s retail customers and ensuring the regional economy remains strong.

Water Authority Preparing for New Challenges Ahead

Looking ahead, the Water Authority recently signed a landmark memorandum of understanding with the U.S. Bureau of Reclamation and water agencies in Arizona and Nevada. This pilot program would allow the Water Authority to move conserved water to drought-stricken states throughout the Southwest.

This concept requires no new infrastructure. Conserved water from the Imperial Valley that would normally travel into San Diego will instead remain in Lake Mead and be directed to Arizona or Nevada. This landmark arrangement will generate revenue to allow reductions in future rate hikes.

“Everyone has a different idea of what affordable is, every single person in this room, every constituency,” said Denham, but he noted that San Diego has plenty of water and can optimize its resilient water portfolio for many years to come.

Denham anticipates the next major challenge for the water industry will be water quality; specifically, the treatment of per- and polyfluoroalkyl substances, commonly known as PFAS or forever chemicals.

Denham said meeting these challenges will require the same innovative spirit that has defined the Water Authority in recent years. Denham credits the Board of Directors for fostering a culture of experimentation and empowering staff to act.

“They come to me with ideas, and it’s ‘Why not, let’s try it,’” said Denham.

By maintaining this solutions-oriented approach, the Water Authority is ensuring San Diego County remains ready to secure reliable water supplies for ratepayers while holding the line on costs well into the future.