An update based on the Sierra Club’s Peter Guerrero’s take on this. And also my thoughts at the end.
On Monday, the City Council voted unanimously to approve the new water agreement that includes raises in the cost of water to city residents, along with a new contract with the PT Paper Mill and improvements to the pipeline infrastructure. The agreement incorporates the Sierra Club’s recommendations for charging the mill for water used ($4.5 million/year) and for increasing these charges, over time, to encourage conservation. Unfortunately, the agreement establishes the current mill water usage of 11MGD/day as the baseline without seeking any reductions, resulting in the mill continuing to account for over 91% of all water consumed from the Quilcene watershed.
Both the mill and the city got what they wanted: The mill was assured of being able to continue using up to 11MGD while the city was able to put together a “partnership” that avoided having to go to the bond market and that was of a sufficient duration (20 years), avoiding draconian residential rate increases. It was more important for the city to get the mill to offset the steep capital costs of the Olympic Ground Water System (OGWS) than to achieve the kind of conservation gains the Sierra Club and other environmental activists would have liked to see.
Unfortunately, it is likely to be an unstable agreement given the past economic history of the mill and its aging infrastructure. Both suggest the mill may not be around for the full 20-year term of the agreement, leaving the city having to pay tens of millions for infrastructure improvements anyway. Knowing this, the city also voted last night to unanimously to create an industrial water rate, allowing it to sell water to another entity (industrial, PUD, etc.) if needed.
The next debate will be over increases to residential rates required by the agreement. Residential ratepayers have already expressed concern that they are “paying” for the mill’s excessive water use. Unfortunately the city doesn’t see a viable alternative at this time.
Environmentalists will have a second opportunity come 2025-2029 when the USFS will be reconsidering the city’s special use permit allowing it to withdraw water from the Quilcene Watershed.
I would also like to add that one thing I learned by listening to the discussion and reading the agreement is that we are extremely vulnerable to the impending climate changes that are unfolding around us. One issue that was mentioned was that the city looked into substituting well water for the water coming from the mountains and found that there is not nearly enough to supply our needs, let alone the mill. My personal take on the agreement is that it could have been set to a 10 year renewal, given the changing climate. It was also odd that there is no mention of the impact of our taking of significant water from the rivers, given the efforts to restore salmon in those streams. It certainly was never considered in the original setup of the water system.
It also brings up the issue of growth of the city. As new housing developments continue at the roundabout on Discovery Road and also on Cook Avenue there will be a need for more water for the city. The mill is guaranteed 11 MGD. But if the city increases water use, there is more revenue for the OGWS. This is a perverse reversal of conservation, the built reward to grow the city’s water use by greater development in order to lower water costs for all. But the caveat is that if there’s drought conditions and the water is not at the level needed, and does not replenish the holding lakes, we could be in for greater conservation and higher rates.
The water is stored in two holding lakes and we usually end up shifting to drawing from them exclusively by mid summer. As the planet warms and the snow packs become lessened, we will be drawing on those lakes sooner and sooner in the year. That day is coming in the next two to five years, once those large scale developments are built out. That was not discussed by the City Council. Not even a question on it, unless I missed it.