Veneta water supply agreement : EWEB

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Veneta water supply agreement

EWEB Commissioners approved a contract on April 6, 2010, to supply wholesale surplus water to Veneta if and when the city is able fund and construct a 10-mile-long interconnection between its system and EWEB's western terminus on Terry Street in west Eugene. Veneta's city council approved the same contract on April 12.

Benefits

Lowers costs for EWEB customers
Spreading the expense of obtaining, treating and delivering water across a wider base of retail and wholesale customers can help reduce EWEB customers' costs and minimize the magnitude of future rate increases.
Helps EWEB secure water right on the McKenzie River
Two of the three water rights EWEB holds on the McKenzie are perfected, giving EWEB senior rights to 75.6 million gallons per day. The utility must demonstrate to state water regulators that it can put the volume granted in the third water right — an additional 118.2 million gallons per day — to beneficial use within a reasonable timeframe. Selling surplus wholesale water helps EWEB more quickly obtain partial certification of the third water right, which helps secure abundant water supply for future generations.
Reduces costs for wholesale customers
Wholesale purchasers, such as Veneta, are able to contain capital costs because they can forego the expensive infrastructure and operational investments inherent in building and maintaining treatment facilities.

Water supply charts

See charts illustrating the percentage of EWEB's water deliveries that would go to Veneta and the amount of water EWEB diverts from the McKenzie River for treatment.

Current wholesale customers

EWEB has supplied surplus water on a wholesale basis for several decades to surrounding water districts, including:

River Road
Santa Clara
Willamette Water Co.

Wholesale deliveries represent about 8 percent of EWEB's total annual water sales. Projected water usage for existing EWEB customers requires accessing only a small portion of the third McKenzie River water right through 2050. By supplying water on a regional basis to wholesale purchasers, the increased level of water use would allow EWEB to more quickly achieve partial certification of the third water right.

If an interconnection is built, Veneta would initially use an average of about 265,000 gallons per day — about half the daily contract amount now delivered to the Santa Clara Water District. The amount could grow up to a maximum of 4 million gallons per day over the life of the 40-year contract.

EWEB customers currently use an average of about 25 million gallons of water a day, and up to 70 million gallons per day during the peak summer outdoor watering season.

Written into the contract are provisions outlining steps EWEB would take should a water shortage or drought occur. In times of water shortage or drought, city of Eugene customers would have first priority to the water. Under the contract, Veneta will maintain a secondary source of water in case of an EWEB water shortage or curtailment.

Validation process

In April 2010, EWEB filed a petition to "validate" its agreement with Veneta to provide certainty and protection of both parties' interests.

The validation process established under Oregon statute allows for municipal entities to ask the courts to make a judgment on the legality of the contract, such as the agreement between EWEB and Veneta before committing significant public resources to a project.

Specifically, EWEB asked the Lane County Circuit Court to affirm that it has the authority to execute the wholesale water contract with Veneta without approval of the Eugene City Council. In October 2010, the court agreed with EWEB that it doesn't need to seek city council permission to enter into such wholesale contracts. The city is appealing that ruling.

To allow the Veneta project to move forward while the authority issue is appealed, the Eugene City Council on Jan. 24 unanimously approved a resolution supporting the project.

EUGENE WATER & ELECTRIC BOARD