Reclamation District No. 108 Rate Structure Alternatives · RICE - SWEET1 5.50 RICE - WILD1 5.00 SAFFLOWER 2.20 SOYBEANS 2.50 SUDAN GRASS 4.90 SUGAR BEETS 3.50 SUNFLOWERS 2.20 TOMATOES

Reclamation District No. 108

Rate Structure Alternatives

TO DO’S Develop initial rate structure w/landowners

2015 field measurement troubleshooting

2015 irr. season share data/sample invoices

Refine rate structure based on 2015 experience

Produce rate memo

Hold majority protest election

Adopt rate by 2016 Irrigation Season

August 2014Rate Structure Alternatives

2

REVIEW OF SBX7-7Targeted major agricultural water suppliers (>

25,000 ac)

Agricultural water supplier shall:

Measure the volume of water delivered to each

customers

Adopt a pricing structure based at least in part on

volume of water delivered

Implement other Efficient Water Management

Practices (EWMPs) subject to local cost-effectiveness

and technical feasibility

August 2014Measurement Program Update

3

MEASUREMENT PROGRAM IMPLEMENTATION UPDATE

424 Weir Boxes installed for

gravity deliveries

51 Meters installed for pump

deliveries

During 2014 irrigation season,

deliveries south of County Line

Road were measured.

Remaining infrastructure

improvements will be installed

before the 2015 irrigation

season.


4

RATE STRUCTURE ANALYSIS

Current Rate Structure Review

Historical Crop Rate Analysis ($/Acre)

Possible Rate Structures to Comply with

SBX7-7

Projected Crop Rate Analysis ($/Acre)


5

CURRENT RATE STRUCTURE REVIEW

Rice $68 per acre

All Other $16.80 / acre for 1st Irrigation

$ 9.65 / acre for Each Subsequent

Irrigation

Per Acre-Foot $15.15 / acre-foot Measured by

Approved Meter

Note: Discounts are given for lands served by landowner’s re-lift pumping plants


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HISTORICAL CROP RATE ANALYSIS


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Compiled Statistics of Irrigations to Each Crop Using

Historical Irrigation Records from 2010 through 2013

Applied the Current Rates to Determine the Total Cost

for Water Service ($/Acre) for Each Crop

Average Cost per Crop

5th Percentile – 5% of Water Users pay this amount

or less

95th Percentile – 95% of Water Users pay this

amount or less

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HISTORICAL ANALYSIS


Possible Rate Components:

Irrigations – Bill on Number of Irrigations

Acres – Bill on Acres in Field

Fixed Crop Volume – Bill on Acre-Feet using Unit

Duties (AF/Acre) for each Crop

Volume of Water Delivered – Bill on Volume of Water

Measured by a Meter

others?

Note: Pricing Structure Must be Based “at Least in Part” on Volume of Water Delivered


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SAMPLE RATE STRUCTURES TO COMPLY WITH SBX7-7

Example #1 – 100% Measured

Bill fully on the Volume of Water Delivered

using the Volume Measured by a District

Flow Meter ($12)

Same as Per Acre-Foot Option of Current Water

Rate Structure


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SAMPLE RATE STRUCTURES TO COMPLY WITH SBX7-7

Example #2 – 33% Measured & 67% Crop Unit Duty

Bill 33% of costs on the Volume of Water Delivered using the Volume Measured by the District Flow Meter ($4/AF)

33% of RD 108’s Budget (Power and USBR costs) Varies Depending on the amount of Water Diverted, the Remaining is Fixed

Bill 67% of costs on a Assumed Crop Applied Water Unit Duty Basis ($8/AF)

Assumption includes the Crop Applied Water Unit Duties (AF/Acre) as used in the 2014 Water Allocation Policy and the Acreage of the Field


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CROP APPLIED WATER UNIT DUTIES


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Crop Acre-Feet/Acre

ALFALFA 4.50

BARLEY 2.00

BEANS 2.50

BUCKWHEAT 2.00

CANOLA 2.20

CARROTS 2.50

CLOVER 4.50

CONSERVATION 2.50

COTTON 3.30

CORN 6.00

GARLIC 1.50

MARKET VEG 2.50

MELONS 1.60

MILO 2.00

OATS 2.00

ONIONS 1.50

ORCHARDS 4.40

PASTURE 4.90

PUMPKINS 1.60

RICE - MEDIUM1 5.50

RICE - SHORT1 5.50

RICE - SWEET1 5.50

RICE - WILD1 5.00

SAFFLOWER 2.20

SOYBEANS 2.50

SUDAN GRASS 4.90

SUGAR BEETS 3.50

SUNFLOWERS 2.20

TOMATOES 2.30

VETCH 2.50

VINE SEEDS 1.60

WHEAT 2.00

Exhibit A - Applied Water Unit Duties

Reclamation District No. 108

PROJECTED ANALYSISThe Current and 2 Example Rate Structures were Analyzed for:

Rice – Comprises approximately 2/3 of District Lands

Alfalfa – Represents High Water Consumption Crops

Sunflower – Represents Low Water Consumption Crops

Assumptions in Analysis:

The Analysis Assumes the Average amount of Delivered Water to each crop equal to the Crop Applied Water Unit Duties (AF/Acre) as used in the 2014 Water Allocation Policy

The Analysis Assumes the 5th and 95th Percentiles are Equal to Plus or Minus 50% of the Crop Applied Water Unit Duty


13

ANALYSIS FOR RICE

Current Rate

Fixed Rate for all Users $68/Acre

Alternative #1 – 100% Measured:

5th Percentile User 2.75 AF/Acre x $12 / AF = $33/Acre

Average User 5.5 AF/Acre x $12 / AF = $66/Acre



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PROJECTED ANALYSIS FOR RICEAlternative #2 – 33% Measured & 67% Crop Unit Duty:

Measured Portion of Rate


Average User 5.5 AF/Acre x $4 / AF = $22/Acre


Crop Unit Duty Portion of Rate

All Users 5.5 AF/Acre x $8 / AF = $44/Acre

Total Cost for Water Service

5th Percentile User $11/Acre +$44/Acre = $55/Acre

Average User $22/Acre +$44/Acre = $66/Acre

95th Percentile User $33/Acre +$44/Acre = $77/Acre


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PROJECTED ANALYSIS FOR RICE


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PROJECTED ANALYSIS FOR ALFALFA


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PROJECTED ANALYSIS FOR SAFFLOWER


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CURRENT RATES

Advantages

Simulates approx. 80% volumetric rate without measurement for

non-rice crops

Lower cost to implement

Dis-advantages

Lacks relationship between water delivered and cost for rice

High charges for small volume/frequent irrigations


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ALTERNATIVE 1 – 100% MEASUREMENT

Advantages

Equity among water users, user pays more directly for service

received

Incentivizes reduced water use

Dis-advantages

District income would be more variable than the actual costs

which many are fixed

New meter program inaccuracy would have larger cost impacts


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ALTERNATIVE #2 – 33% MEASURED & 67% CROP UNIT DUTY

Advantages

District income tracks expenses with varying deliveries

Meter accuracy is less significant for rates

Dis-advantages

Less incentive to drive conservation


21

2015 IRRIGATION BUDGET

INCOME $2,629,000

EXPENSE $3,479,000

CONTRACT CHARGE $ 869,000

PG&E $1,000,000

SYSTEM RENTAL $1,566,000

CONSERVATION $ 44,000

EXPENSES EXCEED INCOME BY $850,000

December 2014Measurement Program Update

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QUESTIONS/DISCUSSION


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Documents

Reclamation District No. 108 Rate Structure Alternatives · RICE - SWEET1 5.50 RICE - WILD1 5.00 SAFFLOWER 2.20 SOYBEANS 2.50 SUDAN GRASS 4.90 SUGAR BEETS 3.50 SUNFLOWERS 2.20 TOMATOES