A DeepWater Desal business partner is hoping to use the city of Salinas' interest in a proposed desalinated water and power production and sales strategy at Moss Landing to attract investment, including from a major, unidentified firm.
That is according to Salinas City Manager Ray Corpuz, who advised his City Council on Tuesday that time was of the essence in approving a five-year agreement to enter formal talks with DeepWater Desal starting early next year, because of the influence on potential investors.
In answer to a query from new Councilman Jose Castaneda about the timing of the agreement approval, Corpuz said there were large business interests involved in talks with DeepWater Desal partner G3 Data Centers and president John Watkins. Business, Corpuz said, "doesn't move at the speed of government," when Castaneda proposed waiting until after a mid-January council retreat to consider the agreement.
The council approved the agreement by a 4-2 vote Tuesday, with Castaneda and Councilman Tony Barrera dissenting. Councilwoman Jyl Lutes was absent.
The agreement is aimed at exploring a potential deal to purchase desalinated water and wholesale power from a desal plant and power generator at the Dynegy power plant in Moss Landing.
DeepWater Desal CEO Brett Constantz and Watkins made a brief presentation before the council on Tuesday, and a staff report outlined the details of a broad proposal that seeks to establish a "cloud service center" at the power
Several speakers warned the council and city officials against entering the complex world of desal water politics, pointing to the struggles the Peninsula has experienced in trying to get a replacement source of water to offset a state-ordered cutback in pumping from the Carmel River. They called for city officials to get more educated on the issue, and expressed opposition to any city spending on the proposal.
The agreement won't cost the city any money, or commit the city to any future deal, according to a staff report, and Corpuz said it doesn't preclude the city from pursuing discussions with any other entity about water or power.
In other water news, the Monterey Peninsula Regional Water Authority's consultant Separation Processes, Inc., released a final report on Tuesday on its comparison study of three desal plant proposals from California American Water, DeepWater Desal, and the People's Moss Landing Desal Project.
The report suggests the DeepWater Desal project would be the least expensive at about $160 million to build and $10.6 million per year to operate and maintain for a total annual cost per acre foot of about $2,205.
The report found the People's Project would cost about $190 million to build and $9.85 million per year to operate, for a per acre foot cost of about $2,320, while Cal Am's project would cost about $206 million to build and $10.6 million to operate for a per acre foot cost of about $3,300.
That represents a much wider variance in cost estimates from the draft report issued months ago, which found the project costs essentially the same.
The final report still suggests Cal Am's project would be the quickest to completion and delivery, by late 2016, although it acknowledges that Cal Am had already indicated its schedule was slipping, largely because of test well delays. Cal Am has since reported its plant wouldn't start delivering water until the end of 2017 at the earliest.
DeepWater Desal and the People's Project would be ready to deliver water by 2018, according to the report.
Tueday's council meeting featured the swearing-in of new Mayor Joe Gunter, Councilwoman Gloria De La Rosa and Castaneda, who arrived late, well after the other two council members had been sworn in and after public comment had begun. Gunter faced a stormy first council session, absorbing criticism of his opposition to the naming of a new Alisal elementary school after controversial 19th century figure Tiburcio Vasquez.
Jim Johnson can be reached at 753-6753 or email@example.com