WATER
Poseidon Resources’ Carlsbad Desalination
Plant Is a Bad Deal for Southern California
I n order to ensure that Southern California is able to meet its future water demand,
environmental and economic needs, public funding should prioritize projects that
support regional independence, greenhouse gas reduction, job creation and consum-
er and environmental health protection. While policymakers and other stakehold-
ers are proposing various solutions that include increased conservation and reuse
projects, low-impact development and repairing leaking infrastructure, Poseidon
Resources, a private company, is seeking public financial support for an expensive,
risky and environmentally damaging desalination project in Carlsbad, California.
Poseidon misrepresents its past, the project’s cost to
the public and the project’s environmental impacts. Its
proposal is a bad deal for Southern California consum-
ers and the environment and its public subsidy request
should be rejected.
A desalination plant (not owned by Posiedon). Photo by Irina Belousa/iStockphoto.
Fact Sheet • October 2009
Poseidon Resources Has a Record
of Failure
Poseidon’s claim that its “experience and expertise allows
for the delivery of quality projects on time and within
budget”1 is not supported by its track record of attempt-
ing to build ocean desalination plants. In fact, the com-
pany’s only major attempt at building a desalination
project — in 1999 in Tampa Bay, Florida — never got off
the ground.2 After Poseidon’s partner declared bankrupt-
cy, Tampa Bay Water, the public water agency, bought
the plant back.3 Since that time, there is no evidence to
suggest that Poseidon has gained any more experience
building large-scale ocean desalination facilities. Back in
Florida, the Tampa Bay desalination plant was $40 mil-
lion over budget and five years late, and it has yet to pro-
duce the 25 million gallons a day (MGD) it promised on a
regular basis.4 Yet Poseidon plans to use the same reverse
osmosis technology used in Tampa Bay in Carlsbad, for a
plant twice the size.5
Poseidon Can’t Be Trusted: Its
Private Project Relies on Public
Funding and Support
Poseidon’s claim that “public water agencies serving the
cities of Carlsbad, Oceanside, San Marcos, San Diego,
Encinitas, Solana Beach, Rancho Santa Fe, Escondido,
Chula Vista, National City and the unincorporated com-
munities of Rainbow, Bonsall and Fallbrook will be the
direct beneficiaries of a new, affordable and reliable water
supply developed at no expense to the region’s taxpay-
ers”6 is misleading. Poseidon’s financing relies on public
subsidies and support. Poseidon is currently seeking
$250 per acre-foot of water produced from the Metropol-
itan Water District of Southern California (MWD), up to
$14 million per year, which could add up to $350 million
over a 25-year period.7 MWD gets its funding from a vari-
ety of sources, including ratepayers and property taxes.8
Poseidon has also applied for $480 million in tax-exempt
bonds from the California Debt Limit Allocation Commit-
tee,9 which would reduce financing costs by giving a tax
break to bondholders. In effect, this would give Poseidon
a multimillion-dollar federal and state subsidy.
Poseidon’s Carlsbad Project
Misrepresents Environmental
Impacts
Poseidon’s claim that its “Carlsbad and Huntington
Beach desalination projects will be the most technologi-
cally advanced, energy efficient and environmentally
sensitive in the world”10 downplays the potential environ-
mental damage from its plant, which includes threats to
marine life and water quality as well as carbon emissions
that contribute to global warming.
The Carlsbad plant relies on an antiquated once-through
cooling system that will suck in 304 MGD of ocean water
to create the projected 50 MGD of drinking water11 — po-
tentially killing large quantities of fish and other aquatic
life in the process. The U.S. Environmental Protection
Agency estimates that power plants in California using
such structures destroy 312.9 million pounds of fish each
year, a $13.6 million loss to California fishermen.12 The
Clean Water Act requires cooling water intake structures
to reflect the best technology available for minimizing
adverse environmental impact, which has prompted the
State Water Resources Control Board to create a draft
policy to virtually eliminate the impacts of these struc-
tures.13 It is unclear what will happen to the proposed
desalination plant if the cooling intakes are closed.
Wastewater from the proposed plant poses further en-
vironmental risks. Wastewater from desalination plants
contains high concentrations of salt and may contain
toxic chemicals and heavy metals from the industrial
process.14 Changes to water quality and temperature from
such waste products could harm coastal water quality and
marine life.15 Of the 304 MGD of ocean water the plant
sucks in, only 50 MGD will come out as drinking water;
57 MGD will become wastewater.16 The wastewater will be
mixed with the remaining 197 MGD and discharged back
into the ocean.17
The proposed plant will also create new demand for
energy at a time when the state is attempting to reduce its
energy use and greenhouse gas emissions. The proposed
plant will require 274,400 megawatt hours a year (MWh/
yr).18 The typical new house in California uses 7,035
kilowatt hours a year (kWh/yr),19 which means that the
desalination plant will use the same amount of electricity
as 39,000 such homes. There are currently 31,521 house-
holds in the entire city of Carlsbad.20
Questions Remain About Water
Quality from Proposed Desalination
Facility
Poseidon’s statement that “the Carlsbad desalination
Project will provide San Diego County with a locally-
controlled, drought-proof supply of high-quality water
that meets or exceeds all state and federal drinking water
standards”21 implies that desalinated water does not come
along with health safety concerns, when in fact it does.
Seawater can contain regulated and unregulated chemi-
cals as well as endocrine disruptors, pharmaceuticals,
personal care products and toxins from marine algae.22
Some of these contaminants may not be adequately
removed in the reverse osmosis process. For example,
boron is a chemical that may act as an herbicide and pose
human health risks.23 It is found at higher levels in ocean
water than freshwater, and standard reverse osmosis
membranes procedures can only remove 50 to 70 per-
cent of the element.24 The U.S. Environmental Protection
Agency does not regulate boron nationally.25 This means
that water could still locally contain levels of the element
that may pose a health risk. Policymakers should require
Poseidon to explain how they plan to address the public
safety concerns associated with desalinated water before
moving forward with any desalination plant.
Conclusion
Given its track record of failure and misleading rhetoric,
policymakers should not trust Poseidon Resources with
our water future. Rather than subsidizing Poseidon’s
costly project, public dollars should be invested in smart
regional water solutions that will help us meet our future
water, environmental and economic needs.
Endnotes
1 Poseidon Resources. [Website]. “About Us.” Available at www.poseidonre-
sources.com/about_us.html. Accessed on Oct 22, 2009.
2 Cooley, Heather, Gleick, Peter and Wolff, Gary. “Desalination, with a grain of
salt.” Pacific Institute, Oakland, California, June 2006. Appendix C.
3 Cooley, Heather, Gleick, Peter and Wolff, Gary. “Desalination, with a grain of
salt.” Pacific Institute, Oakland, California, June 2006. Appendix C.
4 Pittman, Craig. “More trouble at desal plant.” St. Petersburg Times. March
16, 2009.
5 Tampa Bay plant: 25mgd; Barnett, Cynthia. “Salty Solution” Florida Trend
Magazine, May 1, 2007. Carlsbad plant: 50mgd; California Regional Water
Quality Control Board, San Diego Region. Order No. R9-2009-0038 Amend-
ing Order No. R9-2006-0065 (NPDES No. CA0109223) Waste Discharge
Requirements for the Poseidon Resources Corporation Carlsbad Desalina-
tion Project Discharge to the Pacific Ocean Via the Encina Power Station
Discharge Channel. May 13, 2009 at 1.
6 Poseidon Resources. [Website] “Carlsbad Desalination Project.” Available at
www.carlsbad-desal.com/default.asp. Accessed on October 22, 2009.
7 Arakawa, Stephen and Jeffrey Kightlinger. [Letter] Letter to Board of Direc-
tors of the Water Planning and Stewardship Committee of the Metropolitan
Water District of Southern California. October 13, 2009.
8 Metropolitan Water District of Southern California. “Challenges and Break-
throughs: Annual Financial Report 2007-2008.” Financial Highlights. June
30, 2008 at XVIII.
9 California Debt Limit Allocation Committee. Application for an allocation
of the state ceiling on qualified private activity bonds for an exempt facility
project. Borrower: Poseidon Resources. Revised May 2007.
10 Poseidon Resources. “Environmental Stewardship.” Available at www.
poseidonresources.com/environmental_stewardship. Accessed on October
22, 2009.
11 California Regional Water Quality Control Board, San Diego Region. Order
No. R9-2009-0038 Amending Order No. R9-2006-0065 (NPDES No.
CA0109223) Waste Discharge Requirements for the Poseidon Resources
Corporation Carlsbad Desalination Project Discharge to the Pacific Ocean
Via the Encina Power Station Discharge Channel. May 13, 2009 at 1.
12 U.S. Environmental Protection Agency, Phase II—Large existing electric gen-
erating plants, Final Rule, Economic and Benefits Analysis,
Summary of Current Losses Due to I&E. EPA-821-R-04-005. February
2004, located at http://www.epa.gov/waterscience/316b/phase2/econben-
efits/final/c2.pdf
13 California State Water Resources Control Board. “Draft Policy on the Use
of Coastal and Estuarine Waters for Power Plant Cooling.” Posted June 30,
2009.
14 Cooley, Heather, Gleick, Peter and Wolff, Gary. “Desalination, with a grain of
salt.” Pacific Institute, Oakland, California, June 2006 at 59-61.
15 Cooley, Heather, Gleick, Peter and Wolff, Gary. “Desalination, with a grain of
salt.” Pacific Institute, Oakland, California, June 2006 at 59-61.
16 California Regional Water Quality Control Board, San Diego Region. Order
No. R9-2009-0038 Amending Order No. R9-2006-0065 (NPDES No.
CA0109223) Waste Discharge Requirements for the Poseidon Resources
Corporation Carlsbad Desalination Project Discharge to the Pacific Ocean
Via the Encina Power Station Discharge Channel. May 13, 2009 at 1.
17 California Regional Water Quality Control Board, San Diego Region. Order
No. R9-2009-0038 Amending Order No. R9-2006-0065 (NPDES No.
CA0109223) Waste Discharge Requirements for the Poseidon Resources
Corporation Carlsbad Desalination Project Discharge to the Pacific Ocean
Via the Encina Power Station Discharge Channel. May 13, 2009 at 1.
18 Poseidon Resources. “Carlsbad Seawater Desalination Project Energy Mini-
mization and Greenhouse Gas Reduction Plan.” July 3, 2008 at 6.
19 KEMA-XENERGY , Itron and RoperASW. Prepared for California Energy
Commission. “California Statewide Residential Appliance Saturation Study.”
Vol 2, Study Results Final Report. June 2004 at 10.
20 United States Census Bureau. State and County Quick Facts. Carlsbad, CA.
2000. Available at quickfacts.census.gov/qfd/states, accessed October 26,
2009.
21 Poseidon Resources. [Website] “Carlsbad Desalination Project.” Available at
www.carlsbad-desal.com/default.asp. Accessed on October 22, 2009.
22 Cooley, Heather, Gleick, Peter and Wolff, Gary. “Desalination, with a grain of
salt.” Pacific Institute. June 2006 at 53.
23 See Food and Water Watch. “Desalination: An Ocean of Problems.” February
2009 at 8-9.
24 Cooley, Heather, Gleick, Peter and Wolff, Gary. “Desalination, with a grain of
salt.” Pacific Institute. June 2006 at 53.
25 73 Fed. Reg. 44251. “Drinking Water: Regulatory Determinations Regarding
Contaminants on the Second Drinking Water Contaminant Candidate List.”
Environmental Protection Agency. July 30, 2008.
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