In its first study of a controversial canal around the Delta in nearly a decade, California's statewide water agency concluded that it might be able to squeeze 20 percent more water out of the beleaguered Delta.

The report suggests it can do that while better protecting fish and without substantially worsening water quality.

If true, the Peripheral Canal could substantially ease pressure on a water system that is facing potentially severe shortages, badly deteriorating fish populations and court orders that have repeatedly found the state's water pumps are operating illegally.

But the conclusions of the study, a very early look at what state water managers want to do, are certain to be modified by state engineers and regulators and challenged by critics.

"The analysis is biased in a way that disguises the potential impacts of the scenarios they analyze," said Barry Nelson, a water policy analyst with the Natural Resources Defense Council. "There's absolutely no discussion here of what the Delta can accommodate and remain healthy."

The report also suggests that state water officials could seek to loosen water quality standards.

The report, posted recently on a state Web site, was requested by a panel appointed by Gov. Arnold Schwarzenegger to come up with a master plan for the Delta. The panel, the Delta Vision Blue Ribbon Task Force, is expected to make a recommendation next month on how best to move water through the Delta

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region, a subject that harkens back 26 years to one of the most divisive political battles in California history.

By taking water from the Sacramento River instead of from pumps near Tracy, the Peripheral Canal would deliver cleaner water and eliminate the deaths of millions of fish each year at the pumps. But it also would partially dewater the Delta and increase the concentration of salt and pollution in the estuary, including where the Contra Costa Water District's intake pipes are located.

It also would lower flows on the lower Sacramento River, which could be a problem for declining salmon runs.

The first attempt at building a canal was defeated in a 1982 referendum.

However, it has received renewed interest in recent years after Delta water deliveries hit new highs, fish populations plummeted and courts ordered water supply reductions.

In a twist, the task force and state water managers are leaning toward building a canal but using it in conjunction with the existing pumps near Tracy. A study done last year found that relying solely on a canal would, surprisingly, reduce the amount of available water.

The most likely version of the combo plan, called "dual conveyance," would cost $8.6 billion to $17.2 billion, according to the Department of Water Resources study.

It would increase Delta water supplies to the Bay Area, San Joaquin Valley, Central coast and Southern California by roughly 1 million acre-feet, or enough for 8 million people, in an average year, the study estimated.

The proposed plumbing system could do that by taking water from the Sacramento River through the 43-mile Peripheral Canal and the Tracy pumps. Operators would decide where to take water from based on water quality in the Delta, the location of migrating salmon, smelt and other fish species and whatever operating rules happen to be in place.

The 39-page study suggests that state water officials could ask that current salinity standards be revisited because the original regulations were designed largely to keep small fish away from the Delta pumps. If water is being taken from the Sacramento River, the pumps would not be running and there would be no need to keep fish away from them.

"That's not a rationale anymore," said water resources department deputy director Jerry Johns.

The report says that if the overall salinity regulation is substantially changed, water operations could end up controlled by a regulation that protects water quality at the Contra Costa Water District's intake at Rock Slough.

If that were the case, that regulation also could be eliminated if the Contra Costa Water District agreed to participate in the dual conveyance plan.

"That's a whole lot of wishful thinking there," said Greg Gartrell, Contra Costa Water District's assistant general manager.

Johns objected to the characterization that the result of those changes would be weakened regulations, saying that the intent of those regulations would no longer apply and that regulators would insist on appropriate controls.

"It's the beginning of a long, complicated process," he said.

Mike Taugher covers natural resources. Reach him at 925-943-8257 or mtaugher@bayareanewsgroup.com.