Last week Governor Brown signed two companion bills to put California on the path to greater water use efficiency in light of climate change and the reality that water utilities are facing a “new normal.” These bills – SB 606 (Hertzberg) and AB 1668 (Friedman) – grew out of the Governor’s 2016 Executive Order about Making Water Conservation a California Way of Life, and a yearlong stakeholder process that resulted in an implementing Framework for the Executive Order in April 2017. Although much of the Framework structure was retained, the plan shifted and evolved during the legislative debate.

To provide a bit of clarity now that the bills have become law, this blog takes a look at what these new laws will do, what they won’t do, and a few key take-aways for urban water suppliers.

What Will the Water Efficiency Legislation Do?

Together, the bills create a new structure for water suppliers to develop water efficiency strategies tailored to their circumstances and needs by relying on the expertise and authority of local decision makers. The statutes are complex, but the key elements most relevant to urban suppliers can be summarized as follows:

  • Urban retail water suppliers will develop “annual urban water use objectives” for their service areas.
  • The water use objectives will be based on a formula including an indoor residential water use efficiency standard set by the Legislature, an outdoor landscape standard based on local conditions, and a leak loss standard, as well as other components.
  • Urban retail water suppliers will implement performance measures to increase water use efficiency among their commercial, industrial, and institutional consumers (CII) by educating those users regarding best management practices or conducting water use audits, among other things.
  • Water providers will need to meet a number of new planning and reporting requirements, but the central change is a new requirement to establish drought contingency plans as part of their Urban Water Management Plans.
  • The State Water Resources Control Board (State Board) and the Department of Water Resources (DWR) are charged with providing technical assistance of various kinds and developing regulations to implement these new programs.

I’ll be preparing a detailed outline of the new rules, changes to reporting requirements, opportunities for public comment, and relevant deadlines that will be available in WaterNow’s member portal within the next few weeks. In the meantime, I’ve provided a quick summary of the key elements and deadlines below.

What is an Urban Water Use Objective?

An “urban water use objective” represents the total amount of efficiently used water that an urban water supplier would deliver within its service area over a year – think of it as a water budget. These objectives will be developed by water providers for their service areas based on 5 primary components:

  • Total estimated efficient indoor residential water use;
  • Total estimated efficient outdoor residential water use and CII water use;
  • Total estimated efficient water losses from leaks;
  • Approved variances (if any); and
  • Credits for qualifying potable reuse (if applicable).

In other words, a water provider’s water use objective will be the sum of its indoor residential, outdoor residential, and CII water uses, as well as water loss estimates. Where applicable, variances and potable reuse credits will be added to this total. Once established, the service provider can take actions or implement strategies it deems most appropriate to ensure that it is able to keep its overall water use within that objective.

Since this is a new way of thinking for many, and there are various complicated elements, the legislation provides time for implementation. Initial water use objectives do not need to be calculated and reported to DWR and the State Board until November 1, 2023, and annually by November 1 thereafter.

Once calculated, water suppliers will compare their urban water use objectives to their actual water use. That comparison will help determine whether the community is using its water efficiently. The idea behind this is to put local urban water suppliers in a better position to identify and help eliminate waste and unnecessary water use.

How Is an Urban Water Use Objective Calculated?

DWR and the State Board will be developing guidelines and methodologies on how to calculate urban water use objectives by October 2021. This will be done pursuant to a broad public process. The 5 key components of this calculation are detailed below

1) The Indoor Residential Standard

In SB 606 and AB 1668, the Legislature established the indoor residential standard itself (rather than delegating this task to the agencies). The standard evolves over time somewhat:

  • 55 gallons per capita per day (GPCD) until January 1, 2025;
  • 52.5 GPCD between January 2, 2025, and January 1, 2030; and
  • 50 GPCD after January 1, 2030.

Current law establishing 55 GPCD as a “provisional standard” has been in place since 2011. DWR and the State Board may not revise these standards to be more stringent; only the Legislature may do so.

2) The Outdoor Standard

Unlike the indoor standard, the Legislature authorized DWR and the State Board to jointly develop efficiency standards for outdoor water use. Their deadline for doing so is October 2021. The outdoor efficient use standards will apply to irrigable landscapes (vs outdoor areas that are currently irrigated).

The bills direct DWR to provide water suppliers with data on the area of residential irrigable lands that should be included in their “total estimated efficient outdoor residential water use.” The concept here is to relieve suppliers of having to use their own resources to make this determination, but they may do so and are not required to use the data provided by DWR so long as certain criteria are met. DWR must have this information available for utilities by January 2021. DWR will also establish long-term standards for the efficient CII water use by June 30, 2022. The outdoor standards will incorporate the principles of the Model Water Efficient Landscape Ordinance and include provisions for swimming pools, spas, and other water features.

3) The Efficient Water Losses Standard

DWR will also set long-term standards for efficient water losses by June 30, 2022. For urban retail water suppliers, this standard will be based on the State Board’s existing obligation to adopt regulations setting performance standards for urban retail water suppliers’ volume of water losses under SB 555 (enacted in 2015).

4) Variances

Recognizing that some water providers are subject to special and unique circumstances, e.g., significant fluctuations in seasonal populations, the new bills provide for a “variance” procedure. This procedure allows water providers to petition the State Board for an adjustment in how they calculate their urban water use objective. Any adjustments would follow the State Board’s usual public process allowing for public review and comment.

5) Potable Reuse/Recycling

The legislation also includes a “credit” for qualifying potable reuse in the water use objective calculation. This is intended to avoid disincentivizing investments in potable reuse. In particular, it allows an urban retail water provider to exceed its urban water use objective by up to 10% or 15% depending on when the recycling facility comes online.

Urban water suppliers that deliver potable reuse water from an “existing facility” may receive a 15% credit towards their efficiency objective. An “existing water recycling facility” is a facility that has a certified Environmental Impact Report by January 1, 2019, and begins producing recycled water suitable for potable reuse by January 1, 2022, i.e., a facility with existing plans and investment. Urban water suppliers bringing recycling facilities online after that time may receive a 10% credit.

When Does an Urban Water Use Objective Become an Enforceable Requirement?

The efficiency legislation provides a “glide path” to compliance to allow for the shift in approach embodied in the bills. The below table summarizes the key elements of the compliance schedule. Notably, no penalties may be imposed for non-compliance until November 2027.

Earliest Date Action Can Take Place SWRCB Action Basis for SWRCB Action Required Remedy and/or Penalty
June 2018-Nov. 2023 None Authorized n/a n/a
Nov. 2023 Informational Orders Issued to an urban retail water provider informing them that it is not meeting its water use objective. No action required

 

No penalties

Nov. 2024 Notices of failure to meet urban water use objective Issued to an urban retail water provider informing them that it is not meeting its water use objective or making reasonable progress. May request the supplier to address areas of concern in its next annual report

 

No penalties

Nov. 2025 Conservation Order Issued to an urban retail water provider informing them that it is not meeting its water use objective or making reasonable progress. May include measures designed to assist a provider in reaching its objective including but not limited to: referral to DWR for tech assistance and/or requirements that the provider conduct various outreach and educational efforts

 

No penalties

Nov. 2027 Orders and regulations authorized by SB 606 and AB 1668 Issued to an urban retail water provider that has violated an order issued by the SWRCB for failing to meet the water use objective or violates a SWRCB water efficiency regulation. May be liable for fines of $1,000 per day and up to $10,000 per day if the violation occurs during emergency drought conditions


What Won’t the Water Efficiency Legislation Do?

Principally, the bills do not mandate one-size-fits-all water conservation or efficiency programs. Local water utilities will retain control over how best to operate their systems in order to meet water use objectives specifically tailored to their communities. I’ve listed here a few other things the legislation will not do, although this is not intended to be comprehensive:

  • The “urban water use objectives” will not be developed in a vacuum. They will be based on local populations, climate, and conditions.
  • Nothing in the water efficiency legislation changes existing water rights.
  • The new legislation does not dictate specific water conservation measures or limit choice of water supply. Rather, CII performance measures will be developed with stakeholder input and nothing in the new laws specify how local water suppliers choose their local supply mixes.
  • Nothing in the new rules require local urban water suppliers to mandate that homeowners or businesses take certain conservation or efficiency actions or face enforcement by the water supplier. Instead, the Legislature created a framework for local water suppliers to determine how best to accomplish efficient water use for their community.

Finally, the water efficiency standards absolutely do not make it illegal for Californians to shower and do laundry on the same day as some websites have reported.

What Are the Key Take-Aways?

In adopting the water efficiency use legislation, the bills’ authors explain that the new rules “make[] clear that local urban water suppliers have primary responsibility for meeting standards-based water use targets, and … retain the flexibility to develop their water supply portfolios, design and implement water conservation strategies, educate their customers, and enforce their rules.”

The key take-aways then, are that California’s urban water suppliers have the further incentive and flexibility to develop robust water efficiency programs tailored to the specific needs of their communities. These are readily achievable goals vital to securing our water future.

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