EXHIBIT 10-B

 

 

Quarterly Water Supply Strategy and Budget Report

California-American Water Company Water Distribution System: April - June 2006

 

                                                                 March 20, 2006

 

 

1.         Management Objectives

 

The District desires to maximize the long-term production potential and protect the environmental quality of the Carmel River and Seaside Groundwater Basins.  In addition, the District desires to maximize the amount of water that can be diverted from the Carmel River Basin and injected into the Seaside Groundwater Basin while complying with the instream flow requirements recommended by the National Marine Fisheries Service (NOAA Fisheries) to protect the Carmel River steelhead population.  To accomplish these goals, a water supply strategy and budget for production within the California American Water (Cal-Am) water distribution system is reviewed quarterly to determine the optimal strategy for operations, given the current hydrologic and system conditions. 

 

2.         Quarterly Water Supply Strategy: April - June 2006

 

On March 7, 2006, staff from the District, Cal-Am and NOAA Fisheries discussed the proposed water supply strategy and related topics for the remainder of March 2006 and the April-June 2006 period.   Currently, Los Padres Reservoir is full and spilling, Carmel River flow is approximately 450 cubic feet per second (cfs) at the MPWMD gaging station at Don Juan Bridge in Garland Park, and there is approximately 500 cfs flow in the Carmel River below river mile 5.5.[1]  Most of February had been dry, with inflows ranging from 47 to 80 cfs at San Clemente Reservoir during the February 1-26 period.  Subsequently, several storms passed over Central California during the last three days of February and first week of March and inflows increased substantially, with daily inflows ranging from approximately 380 to 2,100 cfs.  

 

Given these conditions, it was agreed that for the remainder of March and in April 2006, Cal-Am's diversions from the upper Carmel Valley would be up to 4.0 cfs, including combined production from the Russell Wells Nos. 2 and 4 and other sources upstream of and including Scarlett Well No. 8.  In May 2006, the proposed budget allows Cal-Am to divert up to 2.1 cfs from its combined sources upstream of and including Scarlett Well No. 8.  During June 2006, the proposed budget allows Cal-Am a net diversion of no more than 0.96 cfs or 57 AF from the Russell Wells Nos. 2 and 4. If feasible, Cal-Am could divert water from its San Clemente Reservoir during this period. However, the feasibility of diverting water at San Clemente Dam will probably be constrained by water quality and operations related to the San Clemente Reservoir Drawdown Project mandated by the California Department of Water Resources (DWR). With the exception of the Upper Carmel Valley, Cal-Am will operate its wells in the Lower Carmel Valley in a downstream to upstream sequence, as needed to meet demand. 

 

For the Seaside Basin, it was agreed that in May and continuing through June 2006, Cal-Am will gradually shift its production from the Carmel River Basin to wells in the Seaside Basin, associated with anticipated declining rainfall and runoff in the Carmel Basin. Accordingly, more of the water needed to serve Cal-Am customers will be produced from the Seaside Basin as the dry season progresses.  Specifically, in May, Cal-Am will draw water from the shallower Paso Robles aquifer and other wells, except for the Paralta Well with a production goal of 300 AF.  In June 2006, Cal-Am will bring on all of its Seaside wells with a goal of 500 AF.   Cal-Am will operate its wells in the Lower Carmel Valley in a downstream to upstream sequence.  

 

It is assumed that there will be sufficient flow in the Carmel River in March and April 2006 to allow diversions to be made for the Seaside ASR Project.  The projected production values are based on the assumption that daily inflows in the upper watershed will average 98 cfs in April, 44 cfs in May, and 17 cfs in June.  If actual inflows are more or less than projected, the group will reconvene and adjust the diversion and release rates accordingly.  These adjustments will take into account flows needed for steelhead migration, spawning and egg incubation, and Cal-Am’s operational needs.

 

Based on the rainfall and runoff that occurred during the October 2005 through February 2006 period, it was agreed that the projections for the upcoming quarter should be based on the assumption that inflows will approximate normal monthly levels during the budgeted April through June 2006 period.  Based on this assumption and recent rainfall, District staff projected monthly unimpaired inflows at the San Clemente Dam site of 11,250, 5,953, 2,829 and 1,057 AF for the months of March, April, May and June 2006, respectively. These monthly inflows equal the 50% (median) expected flow values for the 1902-2005 period of record.  Table 1 shows a monthly breakdown of the recommended diversion and release schedule under the projected inflow conditions. Table 1 also shows expected inflows, outflows, and storage volumes at Los Padres and San Clemente Reservoirs for the April-June 2006 period.

 

It should be noted that there is significant uncertainty regarding the rainfall and runoff that will occur during the upcoming quarter, which accounts for almost 45% of the runoff expected during the year on average. This uncertainty is compounded by the situation at San Clemente Dam and Reservoir. Based on a verbal description of the Biological Opinion for the Interim San Clemente Reservoir Drawdown Project by NOAA Fisheries, staff understands that Cal-Am will operate San Clemente Dam in Spring 2006 as follows:

 

1)         The reservoir will remain full at the spillway elevation of 525 feet through May 31, 2006.

2)         Drawdown of the reservoir from elevation 525 feet to 515 feet will commence on June 1, 2006, subject to the maximum capacity of the outlet works at San Clemente Dam.

3)         During the drawdown period beginning June 1, 2006, the reservoir releases may be modified, depending on the physical ability to release water while minimizing the amount sediment passing downstream through the ports or any other passage.

 

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[1] Conditions as of March 8, 2006.