Episode One –A New Chapter for the Region’s Water Strategy
Over the past several years, the San Diego region has entered a new phase. One defined not by rapid growth, but by stability. Population growth has slowed, and at the same time, San Diegans have stepped up in a big way when it comes to water conservation.
As General Manager Dan Denham explains, these shifts, combined with new water supplies coming online through local and regional investments, have led to an unexpected but important reality: San Diego now has more water supply flexibility than ever before.
Rather than reacting to scarcity, the Water Authority is now proactively responding to abundance and using that position to rethink how water is managed, shared, and valued across the Southwest.
From Scarcity to Strategic Flexibility
“For years, our focus was on securing reliable water for the region—and we’ve done that,” Denham explains. “Now, we’re in a position where we can rebalance our water resource mix without compromising that reliability.”
That rebalancing effort is at the heart of a new strategy:
This approach reflects both changing demand patterns and long-term climate realities. With lower overall water use and more diversified supply sources, the region can explore new opportunities, while maintaining the independence and reliability built over the past two decades.
A Historic Shift Following a Landmark Agreement
This effort stems directly from a major milestone: the resolution of a 15-year dispute with the Metropolitan Water District of Southern California.
As part of that settlement, the Water Authority gained the ability to:
- Transfer up to 50,000 acre-feet of water
- Share supply within the Metropolitan system
- Explore interstate exchanges with other partners
“This opens the door to something we’ve never been able to do before,” Denham notes. “We now have the ability to move water strategically, creating value not just for San Diego, but for the broader region.”
A High-Value Supply—Without New Infrastructure
One of the most compelling aspects of this opportunity is the type of water being offered.
This isn’t water that requires expensive new infrastructure or major capital investment. Instead, it comes from:
- Conservation efforts in the Imperial Valley
- Long-standing efficiency and transfer agreements
- Existing infrastructure already in place
In a time when developing new water sources often means costly solutions like desalination or advanced water reuse, this presents a rare advantage.
“As we’ve seen across California, the era of ‘cheap water’ is over,” Denham explains. “The fact that we can provide a highly reliable supply without requiring new infrastructure makes this a very attractive opportunity for partner agencies.”
A Financial Reset for the Region
Beyond regional collaboration, this strategy has significant local benefits.
By optimizing how water is allocated and sold, the Water Authority can:
- Stabilize water rates over time
- Reduce financial pressure from fixed supply costs
- Begin to pay down debt tied to past infrastructure investments
“This gives us a chance to hit the reset button financially,” Denham says. “Our goal is to move toward a future where rates are more stable, predictable, and aligned with how water is actually being used today.”