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CAP Storage & Recovery in the Tucson AMA. Preliminary Observations & Policy Options from the Institutional and Policy Advisory Group (IPAG) Informational Briefing AWBA Board Meeting, March 20, 2002. IPAG Background. Regional Recharge Plan (1998) AWBA Facilities Plan for TAMA (1998)

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Cap storage recovery in the tucson ama

CAP Storage & Recovery in the Tucson AMA

Preliminary Observations &

Policy Options from the Institutional

and Policy Advisory Group (IPAG)

Informational Briefing

AWBA Board Meeting, March 20, 2002


Ipag background
IPAG Background

  • Regional Recharge Plan (1998)

  • AWBA Facilities Plan for TAMA (1998)

  • Ongoing examination

    • Recharge capacity & sites

      • Kai-Avra proposal (2000)

  • Subcontract firming

  • Recovery


Analysis
Analysis

  • Re-examination of the 1998 Regional Recharge Plan

  • Much of the report remains valid and useful

  • Partially outdated due to additional facilities and other factors

  • Updated analysis

  • More comprehensive exploration of physical & financial variables

  • Emphasis on AWBA activities


Analytic tool
Analytic Tool

  • Series of linked, interactive spreadsheets

  • DEMAND by sector & provider

  • USF & GSF capacities & fees

  • AWBA funding

  • & storage

  • STORAGE by facility,

  • storer & year

  • SUMMARY


Awba spreadsheet
AWBA Spreadsheet

Cost of water, cost of storage, 4-cent tax revenue & carryover, withdrawal fees, etc.

  • “Baseline” Assumptions

    • Cost of water: CAP advisory

    • rates through 2007, 3% growth

    • thereafter

    • Ad valorem tax: $1.6 million

    • base, 3% annual growth

    • Facility charge: flat $12,

    • based on average cost at TAMA

    • USFs and 2% GSF

Annual & cumulative storage


Cap firming
CAP Firming

  • The AWBA’s firming target for the Tucson AMA will not be met with projected revenue

  • 200,000+ AF shortfall

  • (30% below target)

  • Shortfall reflects

  • revenue constraints

  • and cost of credits

  • Will likely result in

  • future groundwater

  • mining


Firming options
Firming Options

  • Bridging the firming gap {options under consideration}

  • Lower the cost of credits

    • Continue to lower water costs

      • Seek low-cost energy

    • Continue to lower storage costs at USFs

      • Spread fixed costs by utilizing available capacity

    • Increase utilization of TAMA GSFs

      • Invest in infrastructure to GSFs willing to pay $21/AF

      • Use Withdrawal Fee money to buy-down the $21

      • Lower the AWBA GSF price for the Tucson AMA


Firming options1
Firming Options

  • Bridging the firming gap {options under consideration}

    • Restructure existing TAMA revenue sources

      • Extend ad valorem revenue stream

      • Use Withdrawal Fee money for firming

  • Other

  • It is likely that a combination of solutions

    will be required


Firming options2
Firming Options

30% USF; 70% GSF with $4/AF buy-down

  • Hypothetical Example

  • Lowering the cost of credits through buy-down

  • of the $21/AF

80% USF; 20% GSF with $4/AF buy-down

“Baseline” 98% USF


Cap recharge locations

Ground

water

flow

Operational GSFs

Operational USFs

Central Arizona Project

Service Areas/CC&Ns

CAP Recharge Locations

Kai-Red Rock

CMID

Lower Santa Cruz USF

BKW

Avra USF

Clearwater

Pima Mine Rd.


Recovery
Recovery

  • There is strong interest in where water is stored and how it will be recovered

  • Recovery planning activities

  • Encourage & participate in dialog with CAWCD, AWBA, ADWR, et al.

  • Further identify TAMA subcontractors’ recovery needs

  • Explore the recovery implications of interstate storage


Next steps
Next Steps

  • Continue to refine analysis

    • Develop recommendations

  • Participate in recovery discussions


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