The U.S. Environmental Protection Agency announced a $170 million loan to Poseidon Resources in San Diego to support its Carlsbad Desalination Plant Intake Modification and Wetlands Project.
The project will upgrade the drinking water desalination plant and create a new intake facility to comply with state ocean water intake regulations, according to a March 23 news release. The funds come from the Water Infrastructure Finance and Innovation Act.
“Diversifying and stretching precious water supplies is essential in the water-scarce west," EPA Assistant Administrator for Water Radhika Fox said in the release. “Our WIFIA loan to Poseidon Resources in San Diego County will be used for both upgrading the drinking water desalination plant to help address water shortages, stretch precious water supplies and protect critical marine habitats in the San Diego Bay.”
The $170 million loan will also be used to restore approximately 125 acres of coastal wetlands to provide habitats for native plants and wildlife, the release reported
The Carlsbad Desalination Plant provides 10% of San Diego County's water supply and was opened in 2015 through a public-private partnership, according to the release. Poseidon Resources' financing package is made up of $160 million in tax-exempt Private Activity Bonds and $170 million in WIFIA's low-cost credit support.
Poseidon Resources President Sachin Chawla expressed excitement about the company's partnership with the EPA as the project modernizes the intake system at the Carlsbad Desalination Plant and creates 125 acres of coastal wetlands, the release said. With this, WIFIA financing alone will save ratepayers about $54 million compared to alternative financing approaches.
EPA's WIFIA program accelerates investment in the nation's water infrastructure by providing long-term, low-cost supplemental credit assistance for regionally and nationally significant projects, the release reported. EPA has already announced 101 WIFIA loans, providing $17 billion in credit assistance, helping to finance $37 billion for water infrastructure, creating 125,000 jobs and saving ratepayers more than $5 billion.
EPA is currently accepting letters of interest for WIFIA and SWIFIA loans, according to the release.
