O.C. Water District delays vote on Huntington Beach desalination project’s rate plan

The Orange County Water District delayed voting Wednesday on updated terms for buying water from the proposed Huntington Beach ocean desalination plant.

Board members wanted more time to review the rate plan and gather additional community feedback on an updated rate sheet, which was made public Friday with the meeting agenda.

Several community members, environmental activists and water district representatives raised concerns.

The 10-member board voted unanimously to reconsider the proposal July 18.

If approved, the non-binding, updated term sheet would shorten the length of the contract between the water district and Poseidon Water from 50 years to 30 or 35 years. It also would shift responsibilities and change how the district pays for Poseidon’s desalinated seawater.

The term sheet would serve as the contract if Poseidon receives the final necessary permits.

The Orange County district is no longer looking to use a rate benchmark indexed by the Metropolitan Water District. Instead it would pay Poseidon’s documented cost of service along with an agreed-on return on equity, according to a staff report.

The new approach is based on the agreement between the San Diego County Water Authority and Poseidon to construct and operate the Carlsbad ocean desalination facility.

Other changes include the water district assuming electricity rate increases to help negotiate a slightly higher overall rate for water.

District officials estimate ratepayers would see a monthly increase of $3 to $6.

The district also would require Poseidon to finance and build the facility needed to distribute water to other water agencies.

Poseidon’s project has long been disputed by some residents and environmentalists who say the $1-billion plant proposed for Newland Street and Pacific Coast Highway would harm marine animals by trapping them in the plant’s intake system and by discharging briny water after it is separated in the desalination process.

Poseidon has said there would be no significant impact on sea creatures.

Supporters, who include Huntington Beach Mayor Mike Posey, say the project would help increase the area’s affordable local water supply.

Posey called the updated term sheet a “significant improvement,” saying it would financially benefit Huntington Beach and Orange County.

Critics expressed their discontent with the district board, which they said appeared ready to rubber stamp the term sheet without hearing from residents.

Many urged the board to find an alternative to Poseidon and defer action on the term sheet.

Ray Hiemstra, associate director of programs for Costa Mesa-based Orange County Coastkeeper, said the proposal shouldn’t move forward until Poseidon can show success with its Carlsbad facility.

That plant, now in its third year of operation, has met its goals to date, according to Peter MacLaggan, senior vice president of Poseidon.

MacLaggan denied critics’ assertions that the facility in northern San Diego County is damaging the environment.

Shawn Dewane, second vice president of the Orange County Water District board, urged members to pass the nonbinding contract, saying the project has been discussed ad nauseam for decades.

Board member Vicente Sarmiento said scrutiny, comments and constructive criticism “will make it a better project in the end.”

Priscella.Vega@latimes.com

Twitter: @vegapriscella