Latest Bechtel Foundation-funded PPIC report continues to tout "conveyance"

Latest Bechtel Foundation-funded PPIC report continues to tout "conveyance"

by Dan Bacher

The Public Policy Institute of California (PPIC) has released a new report, "Water and the California Economy" that, like previous reports by the institute, touts new conveyance - the peripheral canal or tunnel - as a "solution" to providing "water reliability" in California.

And like previous reports, the study was funded by the Stephen D. Bechtel Foundation. Stephen D. Bechtel, Jr. ran the Bechtel Corporation for 30 years. He is the son of Stephen David Bechtel, Sr. and grandson of Warren A. Bechtel who founded the Bechtel Corporation, the largest engineering firm in the United States.

However, the report authors appears to be backing off a bit from previous outright endorsements of the canal by pointing out the increased costs now estimated to build "new conveyance" and the reluctance of the water contractors to pay for the project.

According to Dr. Jeffrey Michael, Director of the Business Forecasting Center and Associate Professor, Eberhardt School of Business, University of the Pacific, "They have brought in some very solid new economists that were not part of their earlier reports, and they acknowledge that some key facts have changed since their 2008/2010 report endorsing a peripheral canal that I have criticized so much over the years."

"Most importantly, these facts include the ever increasing cost of new conveyance, as well as better understanding of the real costs of earthquake interruptions, and an increasing understanding that urban water demand is declining due to the combination of conservation and slower growth," stated Michael. (http://valleyecon.blogspot.com/2012/05/first-impression-of-new-ppic-water.html).

"This report contains no statement that a peripheral canal or tunnel is the best choice for California’s economy, a statement that has headlined previous PPIC reports written by the smaller UC-Davis based group. In fact, it even has a more accurate statement of the what the previous PPIC/Davis studies actually found (see page 15)," said Michael.

“It’s good," said Michael. "Really, I mean it."

I wouldn't go that far. The section of the report touting the canal or tunnel still repeats the inaccurate, unsubstantiated claims that conveyance could provide greater water reliability, protection from a "catastrophic supply disruption," and ecosystem restoration. For a detailed response by Delta advocates to these false claims, see: http://blogs.alternet.org/danbacher/2012/02/23/surprise-new-ppic-report-promotes-peripheral-canal.

The report states: "Highly unreliable water supplies can pose significant long-term threats to California’s economy by limiting new growth and investment. The biggest single source of unreliability in California today is the Sacramento–San Joaquin Delta, given its importance as a supply source for large parts of the state.

Steps must be taken now to reduce supply risk in the near term and into the future. In the near term, efforts are needed to build more resiliency into the system to reduce the costs of a catastrophic supply disruption. For the longer term, it is essential to make a decision about new conveyance.

Past PPIC research has shown that a peripheral canal would be the "best" option to meet the “coequal goals” of water supply reliability and ecosystem health (Lund et al. 2010)."

Cost estimates have increased significantly

The report notes that, "Today, options have multiplied—from a canal to a tunnel to two tunnels—and cost estimates have increased significantly.

"In 2008, official estimates for new aboveground conveyance ranged from $4 billion to $9 billion (California Department of Water Resources 2008). By 2012, as attention has shifted to building tunnels, cost estimates have increased to roughly $14 billion—not including the costs of financing and added operational expenses."

The new report asks the question: 'With cost estimates growing, the question arises: Are the benefits of new conveyance great enough to justify the expense? The answer depends partly on the environmental benefits this solution could provide."

Unfortunately, the authors continue to tout the alleged "advantages" of "new conveyance" to the ecosystem and "native species."

"Routing water exports under or around the Delta would make it possible to manage Delta flows in ways that more closely approximate the natural, more variable patterns that existed before the large water export projects came online (Moyle and Bennett 2008; Fleenor et al. 2010).

Such changes, along with expanded seasonal floodplain and tidal marsh habitat and other improvements, could make the Delta more hospitable for native species now in distress. Ecosystem investments could constitute a significant share of the total costs of a new management plan for the Delta—the Bay Delta Conservation Plan estimates that environmental mitigation, including capital and operating costs, could range from $4.7 to $6.2 billion (BDCP Steering Committee 2010)."

While continuing to claim that "New conveyance would provide more reliable, higher quality exports from the Delta," the authors note that "some water users may find it too costly. High-level state leadership will be essential to broker any new conveyance deal, because the various stakeholders are having difficulty finding common ground."

Why build conveyance if urban economies could adjust to taking less or no water from Delta?

The PPIC authors then admit that California urban economies could adjust to taking far less water - or "even no water at all" from the Delta.

"In any event, it will take at least a decade before any new conveyance comes online. This means that agencies will need to pursue alternative strategies to make their systems more resilient in the face of Delta pumping shutdowns and regulatory cutbacks. These alternatives include expanding reliance on local water sources (through conservation, recycling, desalination, stormwater capture) and water marketing. Past PPIC research has also shown that with planning and appropriate investments in alternatives, California’s urban economies could adjust to taking far less water—or even no water at all—from the Delta."

Regardless of how much "conveyance" advocates try to greenwash the construction of the peripheral canal, there is no doubt that once a canal or tunnel is built, the state water contractors would export more water - not less or the same amount of water - from the largest estuary on the West Coast of the Americas.

The export of more Delta water would hasten the extinction of Central Valley salmon, Delta smelt, longfin smelt and other fish species, according to agency and independent scientists alike. It would lead to the destruction of economically valuable recreational and commercial fisheries.

Yet the Brown administration remains committed to build the canal or tunnel. In a series of phone conversations with Delta local county representatives and environmental groups, the California Natural Resources Agency, headed by Natural Resources Secretary John Laird, is announcing a framework based on “decision trees” that will determine how much flow and habitat is needed in the Delta over a fifteen year evaluation period after the project is under construction, according to a news release from Restore the Delta and Food & Water Watch (http://www.restorethedelta.org/1852).

“It’s outrageous to go ahead and try to build a Peripheral Canal and say you will decide how to operate it and address the problems it causes afterwards,” said Bill Jennings, Executive Director of California Sportfishing Protection Alliance. “A peripheral canal or tunnel will kill striped bass, salmon, Delta and longfin smelt and other fish. The striped bass, like salmon and Delta smelt, will be sacrificed on the altar of massive and unwise water exports. The administration’s actions would result in declining water quality and would be colossal mismanagement by the state and federal government.”

Bechtel's history of environmental destruction

Stephen D. Bechtel, Jr., who ran the Bechtel Corporation for 30 years, funded this and previous reports promoting "new conveyance" as the solution to California's water supply problems.

The Bechtel Corporation, notorious for its role in the "reconstruction" of Iraq, is a leading advocate throughout the world of the privatization of water systems. It was Bechtel that sued the country of Bolivia for canceling a contract there sponsored by the World Bank.

A CorpWatch report, "Profiting from Destruction," provides case studies from Bechtel's history of operating in the water, nuclear, energy and public works sectors. These case studies reveal a legacy of unsustainable and destructive practices that have reaped permanent human, environmental and community devastation around the globe.

Letters from "Bechtel affected communities" included in the report provide first-hand descriptions of these impacts, from Bolivia to Native American lands in Nevada. The report reveals "a 100-year history spent capitalizing on the most brutal technologies, reaping immense profits and ignoring the social and environmental costs." For more information, go to http://www.corpwatch.org/article.php?id=6975

Another CorpWatch report, http://www.corpwatch.org/article.php?id=6670, details "Bechtel's Water Wars" in Bolivia. Fortunately, the people of Cochabama rebelled against Bechtel's scheme to privatize their water system and won.

Hopefully, the people of California, like the people of Cochabama, will rise up against the plan by the Brown and Obama administrations to "save" the Delta by draining it.

For the complete PPIC report, go to: http://www.ppic.org/main/publication.asp?i=1015