The latest price of the Delta Tunnel

California's controversial and long-debated plan to revive the Sacramento-San Joaquin Delta and pump more water south finally has a price tag: about $20 billion.

The latest estimate for the Delta Tunnel project — which might transform the vast water system that moves water from Northern California south to farms and cities — is $4 billion higher than the 2020 estimate, largely as a consequence of inflation.

That includes nearly $1.2 billion to offset local and environmental damage, similar to impacts to salmon and rare fish, that state officials call “potentially significant.”

The project's goal is to gather and deliver more water to two-thirds of California's population and 750,000 hectares of farmland during rainy periods, secure supplies against the threats of climate change, and protect the system from earthquakes.

But environmental groups and lots of Delta residents have long warned that the tunnel could put the vulnerable Delta ecosystem at even greater risk and disrupt freshwater flows needed for fish, farms and communities within the region.

The tunnel has been at the middle of heated debate in California for greater than 60 years. It is the epicenter of the water wars pitting Delta locals, environmentalists, tribes and the fishing industry against state officials and water agencies that serve cities and farms, mostly in Southern California.

The state Water Resources Department's latest report comes as state water regulators weigh competing rescue plans for a region they’ve described as “in crisis” and within the midst of “ecosystem collapse.”

Gov. Gavin Newsom supports the proposed project, calling it his “number one climate resiliency program” and hopes it should be approved before he leaves office. The 45-mile-long tunnel would carry water from the Sacramento River across the delta to a reservoir near Livermore, the primary stop of the 444-mile-long California Aqueduct.

The latest estimate and report will help water utilities in Southern California, the Central Coast and the Bay Area evaluate whether it’s cost-effective for them to buy the tunnel water. The state would issue revenue bonds to finance the project, then suppliers would need to pay back the prices.

Water agencies like Southern California's massive Metropolitan Water District are expected to have all the knowledge they should make their decision by the tip of 2026, said Karla Nemeth, director of the Department of Water Resources, which manages the state's vast water system.

“The questions are how this project can be implemented, what guarantees can we have about the resilience it brings to the Delta and our water supply future, and at what cost?” This is what Adel Hagekhalil, general manager of the Metropolitan Water District, said. in an announcement. He said the price estimate “gets us closer to understanding this equation.”

Construction of the tunnel could take at the least until 2044, with construction expected to start around 2029 and take about 15 years.

Had the tunnel been constructed this 12 months, it could have sent 909,000 additional acres of water south from intakes within the North Delta, in line with state water officials. That's almost enough water to fill Folsom Lake and will support greater than 9.5 million people for a 12 months.

The project's total advantages – estimated at around $38 billion – far exceed the prices, the report says, with every dollar spent expected to supply a advantage of $2.20. “In other words, doing nothing is more expensive,” said David Sunding, professor emeritus of environmental economics at UC Berkeley, who led the cost-benefit evaluation.

Sunding said water deliveries from the tunnel would cost about $1,325 per hectare – lower than the typical cost of water produced through desalination, recycling and rainwater capture.

Peter Gleick, co-founder of the Pacific Institute, a worldwide water think tank, said he had serious concerns concerning the evaluation and whether it reflected the true costs of construction, water treatment and distribution. He called for “far more and better” economic and environmental audits.

“This project becomes more expensive every time a new version is proposed, and a project of this nature has never been completed under budget,” he said. “Water savings and efficiency improvements are far cheaper than the Delta project.”

A significant advantage of a tunnel, Sunding said, is seismic preparedness for the state's water system, which is crossed by the main Hayward and San Andreas faults. A catastrophic earthquake that collapses levees could disrupt water supplies for nearly seven months and degrade water quality for nearly one other 12 months. Sunding said the tunnel would ideally allow water deliveries to proceed in some form after earthquakes, or at the least protect water quality.

The tunnel could also increase water exports from the Sacramento River when pumping from the South Delta is proscribed to guard threatened and endangered species, Nemeth said. State and federal estimates indicate hundreds of threatened steelhead trout and endangered winter Chinook salmon have died from pumping efforts this 12 months.

But conservationists warn that a tunnel wouldn’t reduce the danger to fish: the present pumps would still be operational – posing an ongoing threat to protected species. Environmental groups and fishing organizations have sued the project, saying construction of the tunnel would disrupt freshwater flows reduce further – increasing salinity and harmful algae blooms and harming native fish.

Tribes and environmental justice organizations also oppose the state's request to switch water rights to construct and operate the tunnel. “The damaging effects of mismanagement in the Bay Delta can no longer be endured by tribes and Delta communities,” Malissa Tayaba, vice chair of the Shingle Springs Band of Miwok Indians, said in an announcement.

Jon Rosenfield, scientific director of the San Francisco Baykeeper, called it “just the latest version of a plain old water grab.”

The state environmental evaluation warned two years ago that the tunnel could harm endangered and threatened fish, including Delta smelt, winter Chinook salmon and steelhead trout. For example, changes in flows at inlets or downstream could reduce migration, damage habitat, and expose salmon and other native fish to more predators.

The evaluation calls for restoring wetlands on hundreds of acres to offset “potentially significant impacts” – projects that critics say have been slow and inefficient prior to now in California.

The Delta watershed supports about 80% of the state's business salmon fishery, which closed this 12 months for the second straight 12 months as a consequence of declining populations.

“What better way to address declining salmon populations than draining their homes?” Scott Artis, executive director of the Golden State Salmon Association, said in a recent statement. “Bravo, Governor, for turning healthy rivers and estuaries into a punchline that harms tens of thousands of families, businesses and employees across California and Oregon.”

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