Today Cadiz Inc. (NASDAQ:CDZI) (“Cadiz”, the “Company”) released a new report prepared by engineering consulting firm CH2M HILL detailing almost $8 million in annual cost savings to Southern California water users that can be realized through the introduction of high-quality Cadiz Valley Water Conservation, Recovery, and Supply Project (“Project”) water supplies into the region’s water transportation system. By applying an existing salinity assessment model developed by the U.S. Bureau of Reclamation (USBR) and the Metropolitan Water District of Southern California (Metropolitan), the analysis shows that introducing Cadiz water into the Colorado River Aqueduct (CRA), which is one of the main sources of water supply for Southern California, will realize nearly $400 million in savings to regional ratepayers over the 50-year life of the Project ($203 million in today’s dollars). This same model was recently used to evaluate water quality benefits associated with the twin tunnel solution now being pursued through the Bay-Delta Conservation Plan process.
“Among the numerous public benefits of the Cadiz Project, which will bring jobs and sustainable water supplies to thousands across Southern California, is our high-quality, pure water, which can save Southern California residents, businesses and water utilities hundreds of millions of dollars,” said Cadiz President Scott Slater.
Groundwater at the Company’s property in the Cadiz Valley is low in total dissolved solids (TDS), which is the measurement of salinity or the concentration of salts and minerals (such as sodium, calcium and chloride) within a water supply. For example, the TDS measurement for Cadiz groundwater averages approximately 300 milligrams per liter (mg/L), whereas water in the CRA has historically measured 550 to 800 mg/L in TDS and requires treatment or blending before reaching Southern California water users.
High salinity is known to cause deterioration of residential, commercial, and industrial appliances, pipe infrastructure and fixtures. It can also affect crop production, damage irrigation infrastructure and weaken the ability to produce and use recycled water to augment California’s water supplies. Water over 1,000 mg/L TDS is considered too saline for most potable uses. Metropolitan, the owner and operator of the CRA, adopted a salinity management policy in 1999 which established a goal of average annual TDS levels below 500 mg/L in its water supplies.