San Diego Water-Recycling Plant Relocation Costs

The San Diego Gas & Electric (SDG&E) is declining to pay to relocate a massive water-recycling plant, one of the most expensive capital projects in city history.

According to the San Diego Union-Tribune, the San Diego City Council has agreed to pay SDG&E to $35 million to move gas and power lines so work can start on Pure Water San Diego. The $3 billion plan is to promote water-independence by treating wastewater and returning it to city taps.

Moving all of the equipment will cost $98.8 million through June 2020 and the company is unwilling to pass those cost along to customers, who already pay some of the highest electricity rates in the nation.

According to the San Diego Union-Tribune, city officials say they are willing to pay the expense up front so the Pure Water project can stay on schedule.

The source of most of the funding will not be spelled out until multi-year budget projections are rolled out next month. However, the Mayor’s Office say it will recover the money due from the utility.

“There’s no option here,” said Johnnie Perkins, the deputy chief operating officer, to the San Diego Union-Tribune. “That money is going to be returned to the taxpayers.”

Pure Water San Diego is one of the costliest capital projects at $3 billion ever pursued by the city of San Diego. According to the San Diego Union-Tribune, the three-phase plan calls for developing recycling facilities that will convert billions of gallons of wastewater into potable water.

The first phase is expected to cost $1.4 billion and the city plans to issue bonds to pay for the project. According to the Union-Tribune, it was last month that the receipt of a $614 million loan from the U.S. Environmental Protection Agency was announced.

Pure Water will generate more than 80 million gal a day when Phases 2 and 3 are now scheduled to be finished by 2035. According to the Union-Tribune, the $98.8 million in relocation costs do not include the second and third phases.