The long-running tug of war between a developer and the California Coastal Commission staff over the state's first large-scale ocean-water desalination plant continues this week as the two sides wrangle over environmental issues.

In November, the commission tentatively approved a proposal by Poseidon Resources Inc. to build a plant in Carlsbad to desalinate 50 million gallons of seawater a day.

The approval came with 22 conditions.

Poseidon returns to the commission Wednesday with a plan to satisfy those conditions. If it goes well, the company hopes to get final approval to build the plant on the south shore of Agua Hedionda Lagoon.

The most significant conditions address how to compensate for fish and small marine organisms that will be killed in the desalination process, and how to neutralize carbon emissions that will result from plant operations.

The commission's staff and Poseidon officials have a history of differences.

The staff rejected Poseidon's application four times before deeming it complete last August and ready to send to the commission - with a staff recommendation to deny the plan.

The commission approved Poseidon's application Nov. 15 on a 9-3 vote after an 8½-hour hearing that included speeches from public officials who supported the plant and environmental activists who opposed it.

Poseidon proposes building the Western Hemisphere's largest desalination plant on the grounds of the Encina Power Station, which draws ocean water from the lagoon to cool its steam generators.

The $300 million project would take 100 million gallons a day from the power plant's stream and demineralize half of it to produce 50 million gallons of drinking water a day. The other half would be returned to the cooling stream twice as salty, but it would be diluted to reduce the salt concentration before going back to the ocean.

Environmentalists oppose Poseidon's proposal because of the number of fish, larvae and small organisms that would be trapped and killed in the desalination process. The Surfrider Foundation and the Planning and Conservation League sued the Coastal Commission over its approval of the project, saying the proposed plant would harm marine life.

Poseidon officials and the commission's staff also differ over how to implement conditions designed to reduce greenhouse gas emissions and compensate for marine deaths.
The commission's staff wants the plant to abide by standards set in 2006, when California's anti-greenhouse-gas law was enacted.

The staff recommends that Poseidon offset 100 percent of the emissions the plant will contribute through its operations, but Poseidon says that is too stringent.

Poseidon has proposed reducing energy consumption at the plant while creating renewable-energy projects and taking other measures to offset the plant's energy use.

Company officials say they should not be required to offset 100 percent of the plant's emissions, because the desalinated water would replace water now being imported from Northern California that consumes huge amounts of electricity along the way.

They say Poseidon should be responsible only for the energy the desalination plant requires above the amount of electricity used to transfer water from Northern to Southern California.

“It's a big deal for us,” said Peter MacLaggan, Poseidon's senior vice president.

“It represents a five-to tenfold increase in our costs of implementing this condition. . . . It could drive up the cost to the point where it could make it difficult for us to finance the project.”

MacLaggan said Carlsbad plans to replace its entire water supply with desalinated water and will not buy water imported from Northern California. He said Carlsbad residents shouldn't have to pay greenhouse gas offsets twice - once for the desalination plant and once for water they are no longer taking from the State Water Project.

The commission's staff differs with Poseidon over whether water from the desalination plant would replace imported water.

Commission scientist Tom Luster said documents from the Metropolitan Water District - the region's wholesale water provider - say that if some local agencies use desalinated water, Metropolitan either could import less water or redirect it to other customers.