Guest commentary: California Water Commission’s draft ‘Regulations for Quantifying the Public Benefits of Water Storage Projects’: Leveling the playing field

The Safe, Clean and Reliable Drinking Water Supply Act of 2009 (Water Code Section 74744), requires the California Water Commission to develop and adopt, by regulation, methods for the quantification and management of public benefits associated with eligible water storage projects.  The types of public benefits that would be eligible for funding are ecosystem improvements, water quality improvements in the Delta, flood control, emergency response and recreation.  The legislation further specifies that in order to receive funding, the projects must provide measurable improvements to the Delta ecosystem or to the tributaries to the Delta, and funds cannot be used for the costs of environmental mitigation or meeting compliance obligations except for those associated with providing public benefits.

The California Water Commission will soon release the draft guidelines for a first round of public comment.  Two more drafts will be presented in 2014, with each draft being open for comment a minimum of 60 days.  The Commission plans to complete the process by the end of 2014.

Here to tell you more about the proposed new regulations is Robert Shibatani, a physical hydrologist and long-time consultant for the California water industry, and is Vice Chair of the Environmental & Water Resources Institute/ASCE Norcal Chapter, among other distinguished positions. He is the CEO of The SHIBATANI GROUP, Inc., an affiliated practice group of international water resource specialists based in Sacramento.  Mr. Shibatani has been following the process closely as the Commission has been developing the guidelines, and he wrote the following commentary especially for Maven’s Notebook:

After several years of development, the California Water Commission will soon release it’s draft Regulations for Quantifying the Public Benefits of Water Storage Projects for a first round of public comment.  For the past two and a half years, Commission staff and their Department of Water Resources partners have been working hard at developing this set of implementing Guidelines.  The Commission and staff are to be commended for taking on this complex and multi-faceted task.

The Guidelines will assist the Commission in quantifying the claimed public benefits of new water storage projects eligible for funding as recently reaffirmed in AB 1331 (Climate Change Response for Clean and Safe Drinking Water Act of 2014).  These include the CalFED surface storage projects, groundwater, conjunctive use and, reservoir re-operation projects, local and regional surface storage projects, as well as projects that reduce sediment in existing reservoirs or otherwise improving storage capacity.

Originally authorized under SB X7-2, the Safe, Clean and Reliable Drinking Water Act of 2009, the Commission will adopt by regulation methods for the quantification of public benefits offered by these new storage facilities.  This provision, however, is contingent upon approval by the voters of the Water Bond at the November 4, 2014 general election.   If passed, applicants would then be eligible to receive funds to pay for public benefits generated by their water storage projects.  These Guidelines provide applicants with the direction needed to vie for such monies.  Generally, the eligible public benefits include those to the ecosystem, water quality, flood control, emergency response, and recreation resources.

The Guidelines are intended to provide helpful assistance and clarification on a range of issues including how to define public benefits, benefit priorities, project eligibility, and the application procedures.  For new water storage proponents, these much awaited Guidelines provide the direction needed to not only prepare their application packages, but also help focus how they plan, undertake, and report the results of their hydrological analysis.  This is important since the same hydrological information (e.g., instream flows, river temperatures, reservoir storage, reservoir water surface elevation, X2 migration, etc.) needed for environmental effects evaluations (e.g., CEQA and related permitting compliance) would also be relied on to quantify the public benefits of the new water storage projects.

As with anything, there is always room for improvement and these current Guidelines are no different.  Assuming the Water Bond passes, the anticipated number of new proposed water storage projects may be large.  The Commission and staff would face the daunting task of having to evaluate the merits of each project.  Verifying the accuracy and reasonableness of the claimed benefits will no doubt be demanding.  This will surely involve dissecting how each project applicant modeled the system, what assumptions were used, and identifying any biases applied in post-processing.

While the Guidelines provide an effective administrative platform, two key technical issues remain to be addressed.  They include prerequisites involving 1) identifying the standardized baseline and future hydrology, and 2) identifying a uniform set of future operational assumptions.

Standardization process is critical whenever a comparative analysis is adopted such as that being proposed by the Commission.  Without such standardization, the Commission faces the risk of not being able to ascertain analytical bias between projects.  Why?  Because claimed public benefits for the same waterbody, but for differing projects, could (and likely will) vary depending on how the proponents structure, simulate, and present their hydrological analyses.  All projects need to use the same current and future hydrology.  Moreover, they need to use the same projected demands/accretions, regulatory constraints, and operational decisions.

The derivation of public benefits involves comparing a current and future (with project) condition.  So, for example, when a project proponent makes a claim of improved instream water temperatures during the month of August in river X, they base that conclusion on the differences in hydrology between the baseline (current condition) and the hydrology with their project in place.  If either of those baselines varies between projects, it will be very difficult (if not impossible) to directly compare the monetized benefits being claimed between project proponents.  In other words, one project may appear to result in higher benefits to instream water temperatures and, therefore, provide enhancement to early-life stage steelhead rearing.  But if their assumptions for earlier season reservoir flood control and reservoir releases under an assumed thermal management prescriptions are more liberal than another project, then the claimed benefits may be more a result of the hydrologic assumptions than the actual new project.  Without a consistent baseline between projects, it will be virtually impossible to tell what is actually generating those benefits.

The second point relates to the uniform use of an accepted future hydrology.  This is important since all public benefits would be claimed as future projections.  None of the new storage projects likely to come before the Commission will be completed before 2025 at the earliest.  This means that a future assessment of both hydrology and derived public benefits must be made.  Unfortunately, most projects today still rely almost exclusively on simulating effects using the established historic record.  Apart from convenience, there is no reasonable explanation why past hydrology should be used to represent future hydrological conditions.  To do so ignores the extensive research and knowledge developed by DWR and other agencies that confirm a measurable shift in system hydrology, both temporally and spatially over the past century.  Taking a snapshot of a project’s possible benefits using past hydrology and asserting that such benefits would result in 10-20 years time ignores both the reality of climate change and the ever changing nature of our regulatory framework.  As the title of the Act empowering this process clearly states, new storage projects are a response to climate change.  Ignoring climate change hydrology in the evaluation of such projects would seem counter to the intent of the legislation.

To provide the Commission with the best tools to effectively exercise their responsibilities under the Act, the standardization processes described above is essential.  Moreover, such standardization would also provide proponents with the assurance that their projects would be fairly evaluated and appreciably reduce concerns about unintentional biases affecting the significance of one’s claimed benefits.

Fortunately, developing a standardization process, while intricate, is relatively straightforward.  In fact, project proponents regularly undertake such documentation involving the identification of complex modeling assumptions.  It is not something that has never been done before.  DWR is well versed in preparing such technical modeling appendices and could provide valuable assistance in this context.   Once developed (and included in the Final Guidelines perhaps as an Appendix), all proponents could direct their analysis teams to adopt this uniform set of consistent baselines and operational assumptions.

No set of Guidelines can be expected to cover every possible issue or uncertainty.  The standardization issue discussed here, however, represents a vital piece of the pending evaluation process and will go a long way in reducing both uncertainty and discrepancy within and between projects.  Adopting such standardization will provide the Commission with an efficient, fair, and effective means of evaluating the merits of each proposed project and, together with the project proponents, ensure that the playing field for these Guidelines is indeed level.

 About the Author:  Robert Shibatani is a physical hydrologist and long-time consultant for the California water industry.  He is on the Editorial Review Board for the Journal of Water & Climate Change (London, UK), is an IWA Specialist Group Member on the Committee on Climate Change and Managed Adaptations (The Hague, NL), editorial peer reviewer for IWA World Water Congresses, and is Vice Chair of the Environmental & Water Resources Institute/ASCE Norcal Chapter.  Robert is the CEO of The SHIBATANI GROUP, Inc., an affiliated partner with Seven Peaks LLP (Melbourne), and part of an international water resource practice group with project and pursuits in SE Asia, Central Asia, South Africa, Western Africa, Australia and the UK.  He is based in Sacramento, California, USA.

FOR MORE INFORMATION:

  • Click here for the latest working draft of the Regulations for Quantification and Management of Public Benefits; (Note – this is not the official guidelines that will be circulated; at the August Commission meeting, minor changes were made to the language.  The official draft will likely be released next month.)
  • Click here for the California Water Commission’s page, Defining and Quantifying the Public Benefits of Water Storage Projects

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