Poseidon Resources Inc.’s website claims that the desalination plant it wants to build in southeast Huntington Beach, at Newland and Beach avenues, will be a “cost-effective solution to provide residents with a safe and reliable water supply by using existing structures—at no cost to taxpayers.”

Elected officials who voted to approve the desalination plant three years ago have consistently echoed Poseidon’s claim: Poseidon would privately own and operate the plant for its own profit and for its investors—a strictly free market affair with no taxpayer investment or risk, they said.

City council representative Don Hansen praised the project’s supposed free market values to a crowded city council chamber before he gave Poseidon his vote along with three other council members, Keith Bohr, Gil Coerper and Cathy Green.

“My belief is that the market is going to drive the majority of these decisions. I truly believe that,” Hansen said.

If the Poseidon desalination plant is not profitable, he added, it “will never see the light of day. And it’s purely born on private investment dollars, the risk that they [Poseidon] are going to take.”

In a candidates’ debate last year, Hansen warned that “We’re going to need the water” and reassured again that “It’s not us building the plant. It’s all private investment.”

If all goes well for Poseidon, its Huntington Beach plant will produce 50 million gallons of drinking water per day by sometime in 2011. It still needs to obtain additional government permits and must work out a franchise agreement with the city first.

Poseidon plans to build an almost identical desalination plant in the city of Carlsbad. That project is further along in the permit process and if financing comes through it could start construction this summer. Poseidon’s CEOs dream of building large desalination plants at other California coastal locations as well.

Hansen’s appeal to the free market instincts of the voters is persuasive in a city where the call for smaller government is almost a religious doctrine. But attributing either Poseidon project to to free-market karma is misleading because the company could benefit from as much as $1 billion in taxpayer supplied subsidies that would make it easier for Poseidon to attract the private sector financing that it also needs but still lacks in order to build and operate the two plants.

Public vs. Private Ownership
Poseidon’s current desalination proposals are part of the push by larger multi-national corporations to privatize publicly owned water systems around the world. In the case of desalination, public-private partnerships that are heavily dependent upon tax dollars are often the preferred route for shifting control of water resources from the public to the private sector.

Privatization is a radical departure from past approaches to managing water in the United States. Public ownership of water systems is based on the Public Trust Doctrine, a centuries old legal concept that sees access to water as a universal human right based on public ownership for the common good.

Sierra Club attorney Mark Massara says that approval of Poseidon’s plans will set a dangerous legal precedent. “In California and the coastal zone Poseidon is the very first (private) residential desalination facility. And that is a marked departure from the entire history under the Coastal Act.”

Federal and state laws, including the California Coastal Act, treat ocean water as a part of the public commons that must be used primarily for non consumptive uses. One purpose “does not necessarily impair its ability to be used for others,” according to a 2004 analysis by the California Coastal Commission’s research staff. In contrast, privatization advocates treat water as a commodity and more of a human need rather than a human right.

Water privatization began in earnest in the early 1990s as part of the neo-liberal economic reform movement and is now backed by international treaties and banking policies. Neo-liberals deplore government regulations on foreign investors and calls for free and open trade between all nations. In practice, according to critics, free trade imposes privatization upon other nations and allows foreign investors like Poseidon to bypass local labor and environmental regulations.

In separate reports, the Coastal Commission staff and the National Association of Attorney Generals raised serious concerns about the effect of international trade treaties on the ability of state and local governments to force multinational corporations to obey their laws.

Those concerns were quickly brushed aside by the Huntington Beach City Council after Poseidon representatives claimed hat the company was not a multinational corporation, so it could not bypass local laws. But Poseidon promotes itself as the “largest private developer/investor of water treatment facilities in Mexico,” where it has operated for over a decade. Its presence in Mexico and the United States makes Poseidon a multinational corporation by definition.

Costly Water
Desalination is still the most expensive choice for providing water anywhere in the United States. Even with the help of public funds, the price of water from the H.B. plant would still be at least twice as high as regular water source rates for the foreseeable future, an increased financial burden to be paid by southern California residents through increased water fees.

Poseidon executives cite technological improvements in the past two decades that have cut desalination costs considerably. In a 2004 article published in a trade journal, Nicolay Voutchkov, Poseidon’s senior vice president of technical services, wrote about “major breakthroughs” in membrane technology that have made desalination affordable. “Membrane productivity—the amount of water that can be produced by one membrane element—has more than doubled in the past 20 years,” he claimed.

Poseidon’s website promises that desalinated water from its Huntington Beach plant will be “competitive with other new sources of high quality drinking water,” and will be “the lowest cost desalinated water on the west coast.”

And Poseidon VP Peter MacLaggan wrote in a Los Angeles Times op-ed piece last year that seawater desalination is no longer cost prohibitive “due in large part to technological advances and the escalating scarcity of traditional water sources.”

But it was taxpayer funded research conducted by the public sector, not by the private sector, that created the breakthroughs that Poseidon CEOs note—although desalination is still far from being in the economic mainstream, even according to some of its strongest advocates.

Over $1 billion (in 1999 dollars) in federal research and development funds provided by the Saline Water Act passed by Congress in 1952. That led to the development of efficient reverse osmosis, the process that Poseidon will use to convert seawater into drinking water, and to the cost efficiency gains that enable the desalination industry to exist today.

So says “Desalination and Water Purification Technology Roadmap,” an exhaustive and favorable report on the future role of desalination, published in 2003, by the U.S. Bureau of Reclamation.

The report was researched and written by Sandia National Laboratories, a subsidiary of government contractor, Lockheed Martin. Sandia also does research and development about nuclear weapons, national security and economic issues for the U.S. Government.
Desalination to the Rescue?

Sandia advocates privatization of public water systems worldwide based on the theory that government institutions are too short on cash and too inefficiently run to provide adequate water infrastructure and services to the public. Corporate partnerships with government regulatory agencies and the application of free market pricing principles will ensure affordable water for all people and healthy corporate profits too, according to this view.

The report assumes future water shortages nationwide in response to a growing U.S. Population and its increasing demand for water, especially in the southwestern states. It suggests strategies for creating and applying modernized and more cost effective desalination technologies as the solution to those potential shortages.

But abundant supplies of water delivered through public water systems—at little more than basic costs—have limited the need and financial incentive for research and development of desalination technology in the past.

Due to desalination’s high costs for energy use, construction, and maintenance, industry profit margins are in the single digits. Large scale desalination plants are built only in areas of the world where there is little if any other option—mostly in its most arid regions. Only 0.4 percent of water for drinking and industrial use comes from desalination, according the National Academy of Sciences (NAS).

Considering the low demand for desalinated water and its higher costs, it’s no surprise that the desalination industry invested only about one percent—about $5-$10 million—of its gross annual revenue on research and development as of 2003, and most of that went toward modifying existing technologies instead of creating the new ones that are needed for desalination to thrive, according to Sandia. That amount may be more than doubled at present, according to NAS, but that would still be far less than other industries spend for research and development.

But America’s industry and its ever increasing human population greedily exploited its abundant and cheap water supplies in order to maintain and profit from their consumption-based lifestyles. Unbridled development, excessive irrigation of agricultural land and huge lawns were greater priorities than conservation and good management.

Today, it’s payback time. California has declared a state of emergency after a prolonged drought. Our public water systems are severely strained; a dire situation that is exacerbated by human induced climate change and expertly exploited by mulitnational water profiteers to convince the public that desalination’s time is now.

A Drop in the Bucket
As “unimpaired” water resources diminish, Sandia claims, “our nation is now forced to turn to using these impaired water sources,” meaning brackish water from the nation’s inlands and seawater for large urban areas like those that exist all along much of the California coast.

Despite Sandia’s idealist view of private sector efficiency, its proposed roadmap calls for the government to lead the way in funding future technological improvements that it says are necessary to make desalination viable.

Without a renewed surge of government funding for research and development, Sandia says, desalination technology will advance slowly, and large scale desalination plants will remain out of financial reach for the private sector until 2030 or beyond—a long delay during a water supply crisis. But with sufficient government support, the report says, the technological breakthroughs could come as soon as ten years.

The Sandia report dismisses some already proven water management strategies, including conservation as alternative solutions. In fact, the report warns that conservation can also decrease water supplies by reducing the recycling of wastewater “with serious environmental consequences.”

But even the World Bank, an international lending institution based on neo-liberal economic policies, warned that desalination should be an absolute last resort “after all appropriate water demand management measures have been implemented and after carefully evaluating alternative options for conventional bulk water supply…,” in a report it issued in 2004.

Whether the private sector will benefit from another federal spending surge for desalination research and development or not remains to be seen, but current funding levels are a drop in the bucket compared to the amount of money taxpayers gave in 1952.

Congress passed the Water Desalination Research and Development Act of 1996 but only $6.5 million was actually dispersed. Funded projects were small, including an experimental plant built in Long Beach, California. Funding under the act was held back after 2001 by the Bush administration and funding from congressional earmarks fell from $25 million in 2005 to only $10 million in 2007.

Subsidy Worries
The exact amount that taxpayers will pay toward the two southern California desalination plants is still undecided. But Poseidon is banking on a minimum of $700 million funneled through local water districts, at $350 million per project, to help make the Carlsbad and Huntington Beach projects become economically viable.

There are worries, however, even from desalination advocates about the effects of government subsidies.
Subsidies may give the private sector an incentive to continue holding back on research and development, knowing that the government will do it, the Sandia report cautions.

And the World Bank worries that “Excessive investment in desalination,” through direct or indirect public financing, could create a “drain on the national budget” and “implies a cost risk for the end-users/or taxpayers in a country,” especially if demand for the water turns out to be less than expected.

Massara says that Poseidon should have to pay its own way as it promised, but because its Huntington Beach and Carlsbad projects are “not economical,” subsidies are required to get them up and running.

“Every time they walk into a hearing they go, ‘The price is coming down. We know how to do it really cheap now.’ But when you dust off the rhetoric, you realize that it’s still much more expensive than existing water supplies,” Massara complains.

Surfrider Foundation’s California director, Joe Geever, agrees that Poseidon’s plans are unrealistic without subsidies. “Ocean desalination is so energy intensive that the price of that water will never be competitive with any other source of water,” he explains. “Poseidon’s water is 40 percent more energy intensive than pumping the water all the way here from Sacramento. How will the price ever get competitive if they don’t get subsidies?”

Poseidon’s Maclaggan acknowledges the high energy costs, but he says that they apply across the board. “In truth, the escalating energy costs…will affect all means of new drinking water production,” including water reclamation (recycling sewage), he wrote in his Times column.

But the “toilet to tap” recycling plant operated by the Orange County Sanitation District in Fountain valley turns raw sewage into triple the amount of safe drinking water that Poseidon’s Huntington Beach plant will produce and at about one-third the cost, according to the OCSD (see “No Crap Tap,” OC Voice, June, 2008).

A 2005 report issued by the Pacific Institute, a non-partisan and well respected California based environmental research group, concluded that “More energy is required to produce water from desalination than from any other water supply” and that desalination costs may rise due to volatile economic conditions.

The Pacific Institute also questioned the need to subsidize the desalination industry. “The technological state of desalination is sufficiently mature and commercial to require the private sector to bear most of the research costs” it said, and public research funds should focus on environmental concerns that affect the public rather than private sector.

In a free market utopia, Poseidon would pay its way 100 percent. And if there has to be a desalination plant in Huntington Beach that’s the way Joe Geever would like it to be.

“It’s ridiculous,” he fumes, “Why should we spend taxpayers’ money on a project that a private company has already promised to build on its own?”

If you live in Orange County, pat yourself on the back the next time you sit down on the toilet with your copy of the OC Voice, because you’re helping to solve California’s water shortage.

Think of it as one way of giving back to nature what you take from it when you water your lawn, hose down your drive way, fill your large swimming pool, shower for 1 hour or flush your toilet 10 times a day. It may be the one way in which “wasting” water helps to ensure your future water supplies

Water problems aren’t unique to California, or course.  Drought induced by climate change, as well as poor resource management, including inefficient water use by agriculture and residential homes, linked with population growth have created water shortages in at least one-third of the world.

Although social and economic inequalities associated with world trade policies and privatization of water resources have made the world’s poor suffer the most from water shortages, economic wealth alone can no longer guarantee a secure water supply, not even for the richest nation and most prolific over user of natural resources on earth, the United States. Arid areas of the nation are suffering from years of cyclical drought exacerbated by global warming. Even in the wetter areas of the east and southeast, Americans are experiencing severe water shortages that have led to political and regional conflicts.

Big corporate investors as well as grass roots environmentalists realize what’s at stake. “The survival of the human race in the next millennium will be tied to the successes of managing fresh water,” said Aly Shady, president of the International Commission on Irrigation and Drainage (a group supported by international banking and investment interests) in a recent position paper.

An Arid Land
The problem is acute in southern California, an arid environment that depends largely on water shipped from northern California or the Colorado River, resources that are rapidly diminishing, says Ron Wildermuth, Communications Director for the Orange County Sanitation District (OCSD).

It’s a matter of the lifestyle that we have chosen by deciding to live in an arid climate, Wildermuth pointed out, during a recent guided tour he conducted for local water activists of OCSD’s new Groundwater Replenishment System (GRS) located at its Fountain Valley plant. It’s the largest purification facility of its kind in the world and it will ultimately be able to produce 250 million gallons of distilled quality water from sewage each day. All things considered, GWR may be California’s single best hope for avoiding a water catastrophe.

“There’s two things the astronauts can see with the naked eye from the space station,” he tells the group, “One is the great wall of China and the other is the water canals of California. We use more energy moving water than other states use for everything…So we’ve built this metropolis in an arid region with no water. And now we have to find water for this arid region with no water.”

Currently, a lot of the water receive by southern California is stored in 1,250 damns built in northern California and then moved south to Los Angeles, Orange and San Diego counties. The source of that water is snow pack in the Sierra Nevada mountain range. South Orange County relies on northern snow pack and the Colorado River for 95 percent of its water. Huntington Beach gets two-thirds of its water from local groundwater wells supplied by the Santa Ana River.

But snow pack levels in the Sierra Nevada are down 22 percent below normal, the result of a 50 year warming trend, according to that which falls as rain instead of snow. That means less water for both California and Colorado watersheds. Due to being overtaxed by agriculture and urban sprawl, only 0.1 percent of the water from the Colorado River makes it to its mouth, which is basically a big mud pit a lot of the time.

Water Supply Plans
In March, Gov. Schwarzenegger proposed a 20 percent reduction in per capita water use by 2020. In response, two separate bills have been introduced in the legislature to encourage conservation. Assembly Bill 2175, the Water Efficiency and Security Act, increases water use efficiency for new developments and contains global warming reduction measures. AB2175 would require the state to conserve 3 million acre-feet of water by 2030. The legislation is supported by conservation organizations, including the Sierra Club, Desal Response Group and the Environmental Justice Coalition for Water.

Predicted population increases for the same years targeted in the proposed bills add to the need for corrective water use measures. By 2020 the state will grow by 15 million people, including 7 million in Southern California and up to 500,000 in Orange County, according to the OCSD.  State water shortages in the magnitude of 2 – 6 million acre-feet of water per year (1 acre-foot or 326,000 gallons quenches the thirst of two families of four for a year) are predicted by the California Department of Water Resources.

The situation is so dire that the federal government announced that it will cut off all surplus water deliveries to California from the Colorado River by 2016.  The needed restoration of the San Francisco – San Joaquin Bay Delta ecosystem due to over use by agriculture and deteriorating levees, according to the OCSD, has resulted in cut backs in water deliveries to southern California. Central and northern Orange County rely on that water to help replenish a vast lake resting under the Santa Ana River basin that supplies much of their water.

That underground lake also serves as a natural barrier to seawater coming up the Santa Ana River from the ocean; if its level doesn’t remain high enough-and it had dropped to alarming levels in recent years-our source of drinking water would become contaminated by salt water intrusion.

The GRS system will inject its treated water back into that underground basin, protecting it from the ocean while providing a large source of drought free drinking water.

“We decided that we would purify our water, expand the sea barrier and even have some water left over so that we could refill our groundwater basin and delay indefinitely the need for another ocean outfall (a plume of sewage discharged into the ocean),” Wildermuth says.

PR Problem
Toilet to tap, as GWR is often referred to, is a PR problem because many people are disturbed by the thought of drinking water that came from their toilets. But the water is clean and healthy beyond question.  Not only that, it’s tasty, as I found out when I drank a glass of it at the end of the tour.

That’s because the treatment process involves 4 steps from the time it is flushed down your toilet to the time it comes back out of your water faucets. The first 3 steps are microfiltration, reverse osmosis and then treatment with ultra violet light and hydrogen peroxide as a disinfectant.

During microfiltration the sewage water passes through 26 basins containing 608 pipe shaped modules, each of which contain 15,000 straws that form a membrane. “It’s not unlike when you have a soda and a straw,” Wildermuth explains, “the soda comes up your straw, but the ice stays in the cup…the holes in the sides of these straws are 300 times smaller than a human hair. So you put a vacuum on top of the straw, with about 10 per square inches of pressure, and pull all of the water through the straws.”

From there, the treated water goes through reverse osmosis; a process that removes allows only water molecules to pass through another membrane, leaving out minerals, salts, viruses, pharmaceuticals and other pollutants. After that, ultra violet light treatment combined with hydrogen peroxide disinfect the water, removing any trace organics that might have snuck through earlier stages of filtration.

At that point, some minerals are placed back into the water to prevent it from corroding the concrete pipes that it will later pass through. That minerals also improve the water’s taste. The water is ready to drink at that point, but its journey doesn’t end there.

The fourth and final step is to inject the treated water into the groundwater basin. That is done either directly along the seawater barrier to prevent salt water intrusion or by allowing the water to percolate down to the underground basin, a process that takes about 6 months but helps to naturally clean the water even more.

Limited Alternatives
To those who are still not thirsty for GWR, Wildermuth says that there are not many viable alternatives for dealing with our lack of water. “We can take water from farmers and drum beat on them to be more efficient. We can take water out of the ocean. Or we can use ground water. And I think reusing our own water is a good start,” he explains.

Wildermuth’s audience consists of 16 members of Residents 4 Responsible Desal (R4RD), a Huntington Beach group whose members are opposed to a desalination plant approved by the city but still awaiting approval by the California Coastal Commission. R4RD opposes the facility, which will be built and owned by Poseidon Resources, Inc. and would make up to 50 million gallons of drinkable water from seawater daily, but they are very impressed by GWR. They want to know what he thinks of the Poseidon plan.

Wildermuth carefully sidesteps that question, repeating the official OCSD line that “we need to diversify our water supply in southern California,” and that desalination will part of the future supply mix in areas where groundwater basins don’t exist.

But Wildermuth and the official OCSD literature point to a publicly owned and different type of desalination plant than Poseidon, proposed for the city of Dana Point in south Orange County, which has no groundwater basin source. That type of desalination facility is considered much more friendly to the environment than the Poseidon plant because it would suck in seawater from under the ocean shore rather than through the antiquated cooling system like the one that the AES electric generating plant will provide for Poseidon.

Few critics of Poseidon deny the need for desalination plants when properly designed and built where they are needed. But the existence of GWR, which officially went online in January, makes it hard to see why Poseidon’s project is needed in Huntington Beach.

In short, GWR produces far more water for much less money (triple the production at $525 vs. over $1500 per acre-foot) than Poseidon’s desalination plant would. Unlike Poseidon, it would not kill marine life or damage the environment in any way. And the OCSD, which runs the GWR facility, is fully accountable to the public and its representatives, instead of stock holders.