Energy/Water Nexus: Policy, Partnerships to Lead the Way

Utilities across the nation deal with the same utility challenges: procuring supply, managing demand, and mitigating the environmental impacts of both.

Texas and San Antonio utilities are no different, but the local story is unique in that the city, county, and state government, municipally-owned utilities, and other stakeholder organizations have already demonstrated strong leadership and collaboration – as demonstrated at Tuesday’s San Antonio Energy/Water Nexus forum.

Mission Verde Alliance and the San Antonio Clean Technology Forum once again sold out the Pearl Stable for its latest panel discussion.

As rate increase requests from both CPS Energy* and San Antonio Water System (SAWS) are pending approval from City Council, it seems the timing couldn’t have been better for utility administration, civic and business leaders, environmental advocates, scientists and citizens interested in the health of San Antonio’s future to come together to discuss the relationship between local energy and water.

“Nobody likes a rate increase,” Mayor Castro said. “But at the same time, the cost of finding energy and the cost of finding water are going up.”

[Read More:”Investing in San Antonio’s Future: Why Water and Energy Rates Are on the Rise.” ]

The audience of about 450 heard from the panel that sustaining the relationship between water and energy depends on a combination of 1) continued strong leadership within and collaboration between SAWS, CPS, and the City of San Antonio, 2) effective growth policies that respect these natural resources and plans for the future, and 3) behavioral changes by the people of San Antonio themselves.

The panel discussion was moderated by Rivard Report Director Robert Rivard and included SAWS President and CEO Robert Puente, CPS President and CEO Doyle Beneby, State Rep. Lyle Larson, Bexar County Judge Nelson Wolff and Mayor Julián Castro.

Amy Hardberger, associate professor at St. Mary’s University School of Law, whose research focuses on water policy and issues, joined Weir “Old Man Water” Labatt and Director of UTSA’s Texas Sustainable Energy Research Institute Les Shephard on a panel of experts charged with presenting questions to the panel.

Energy and water production systems depend heavily on each other and therefore management of these utilities is inextricably linked. Water is used in energy production – i.e. coal is burned to heat water which spins turbines – and electricity is needed to treat, produce, and transport water.

Panelists agreed that while San Antonio is considered a leader in renewable energy projects and water conservation, much more work must be done – and money must be spent – on ensuring that San Antonio and Texas can accommodate a growing population and growing economy.

Conservation of both water and energy is a key component of keeping costs down for SAWS, CPS, the customer, and the environment, Mayor Castro said. “Encouraging investment in the urban core is tied to the idea of conservation.”

Annexation Rules

Hardberger asked Mayor Castro what the City’s leadership role is in assisting SAWS and CPS in land use decisions and if there were disincentives for urban sprawl, which typically uses more water and energy than inner-city development.

While the city has increased impact fees and implemented development rules (i.e. tree ordinance and drainage requirements), he said, “(SAWS and CPS) service areas reach well past the city limits.”

This limits the city’s ability to enforce building codes and ordinances tied to energy and water use.

Rivard then probed, “Is annexation a tool that the city should consider?”

“Absolutely,” Mayor Castro said. “There are these corridors that will begin to grow in the next few years … and it makes sense for the City to step in before all this (development) happens.”

The City has not used annexation as a tool since the passage of Senate Bill 89 in 1999, which required cities to design and fund a comprehensive plan for how to provide services and wait three years to do so.

“This would be the most important public policy for the city,” Judge Wolff said, making it easier to annex would make land, water, and energy management easier.

“We’ve got 60% of growth in San Antonio area is in the county,” Rep. Larson added. “There needs to be some basic land planning measures passed by the state.”

Proposition 6: Water Project Loans

Another tool to ensure water and energy security, Larson said, is Proposition 6, coming up for a vote on Tuesday, Nov. 5. Before any funds from the $2 billion State Water Plan can be implemented, voters must approve the State Water Implementation Fund for Texas (SWIFT), which directs the Texas Water  Development Board on how the Economic Stabilization or “Rainy Day” fund from oil and gas taxes will be used.

“(Prop 6) gives long-term, low-interest loans to local water projects … we’re not letting anyone ‘take’ money for free from the government,” Larson said of the bill. “Ninety percent of Texas is under drought conditions … if we do nothing, we’ll lose about $116 billion dollars worth of economic growth.”

SAWS’ Diverse Production Projects

While capacity looks good now, added Puente, “We have to plan for out into the future so that we always keep ahead of the growth curve.”

[Read more: “Asking for Less, SAWS Briefs A Receptive City Council on Rate Increase, Major Water Projects“]

Puente outlined his A, B, C, D, E approach to diversifying San Antonio’s water portfolio.

“A” for aquifer storage, to “fully maximize the water that is under our feet” from the Edwards Aquifer, Puente said, without relying on it entirely.

“B” for brackish water, the nation’s largest inland brackish (desalinization) plant will be built in 2016 which will provide water for 106,000 households.

“C” for Carrizo Aquifer wells in Gonzalez County, carried to Bexar County via an existing pipeline that reaches from Gonzales through Guadalupe County and into northeast Bexar County near the Comal County line. By 2016 enough water to service 60,000 homes will flow through the pipeline. “Ten years, 100 million dollars and not a drop of water yet,” Puente said, highlighting the importance of planning ahead and making long-term investments.

“D” for direct recycle system. SAWS operates about 80 miles of purple pipeline (colored to mark as recycled) to golf courses, parks, commercial and industrial customers all over the city. According to SAWS website, “The system can provide up to 35,000 acre-feet per year, or about 29 million gallons per day, thereby conserving large amounts of Edwards water for potable use.”

“‘E’ … nothing (that starts with an) ‘E,’” Puente said, laughing. But “E” ultimately stands for the 50,000 acre feet that will be purchased from an out-of-county water producer.

Labatt’s questions were directed towards this project – about a timeline for completion and price of the water received.

SAWS will start on Friday to interview the three finalists remaining from the companies that responded to the RFP, and a decision likely will be made in Spring 2014, Puente said.

“It’s a lot of expensive water that we’ll have to be ready to pay for,” he said. This water will cost more than that from any other source, including the brackish water desalinization plant. “Because of that we want to involve everyone – a community decision made by our board and City Council … we’re dealing with ratepayer money and we can’t be willy-nilly about it.”

CPS Energy’s Hunt for Alternatives

“We have a whole suite of opportunities out there,” Beneby said. “Certain types of renewables make a lot more sense in Texas than they do in other parts of the country.”

The oil and gas economies are still strong, but “(CPS) is not only trying to ween ourselves off of hydrocarbons, but reduce our need for water, too.”

Solar and wind use no water to produce electricity, so CPS has taken a strong interest in developing those resources, Beneby said.

“We’re on track to (take the equivalent of) 1.5 million autos off the road by 2020,” he said, and that has an impact on climate change and health. “Our goal at CPS has really been to make San Antonio the centerpiece of the new energy economy.”

Collaborating with SAWS is a big part of that new energy economy.

“We have the opportunity to leverage and buy in bulk” as well as share technologies and ideas, he said, pointing to CPS’ switch to smart meters and the industry cross-over capabilities of that kind of wireless mesh network.

UTSA’s Shepard on the forum’s expert panel asked questions regarding Eagle Ford Shale and the possible partnerships between industry, education, and research. The region’s resources have been exploited by the practice of hydraulic fracturing, a process that uses both water and energy to release natural gas from manmade fissures thousands of feet underground.

“Oil and gas (companies) are investing a considerable amount of money (on research),” Shepard said. “How do we better partner with the industry to accelerate our own research?”

Locally, companies have been using innovative techniques – using brackish water instead of fresh water, using pre-treatment strategies and technologies – to make the process more environmentally friendly, Larson said, adding that these changes were made without legislation or an agency telling them to do so.

“We’re not going to mandate it …. they’re going it because of good economics,” Larson said. “From an incubator standpoint (in education/research),” that dialogue will have to be facilitated between researchers and oil and gas companies.

Conservation Lacking in Both Areas

“We have the capacity,” Judge Wolff said, “The issue is how do we best use it?”

Both CPS and SAWS admit that their conservation and awareness efforts directed towards citizens haven’t been as successful as initially hoped. When asked by IDEA Public School students what they could do to help, Beneby’s answer was simple: “Talk to your parents,” he said. “You guys are of an age where this (conservation) stuff is automatic to you … people of my vintage need to relearn.”

It’s the little things that really add up, Mayor Castro offered. “Whether we’re 12 years old or 80 years old … the most important are also the most simple – turning a light off, or a TV.”

“We have very low (energy and water) rates here, Beneby said. “Behavior is the last frontier.”

Water For Life Award 2013

Weir Labatt, a.k.a. Old Man Water, accepted the second annual Water for Life award from inaugural winner Robert Gulley, the recently-retired senior program manager, Edward Aquifer Authority for achieving an “impossible” consensus agreement on the EARIP Habitant Conservation Plan.

The Water for Life award “recogniz(es) an individual in the Greater San Antonio region who has made a water related substantial and significant contribution to the quality of life in our community.”

Labatt thanked the selection committee, SA Clean Tech Forum’s Michael Burke, and especially his wife, Laura. “She’s been very patient and understanding of the hours and time away from home … and (me) always talking about water.”

For next year’s award, he said of his three fellow finalists SARA General Manager Suzanne Scott, the inaugural Edwards Aquifer Authority Chairman Mike Beldon and first CEO of SAWS Joe Aceves, “This is my recommendation – they ought to pick all three.”