San Diego County Grapples with Water Costs as Ambitious Infrastructure Projects Drive Rates Skyward


Ratepayers face potential 150% increase over next decade despite reliable supply and political settlement

San Diego Residents Discover The cost of water security is high living in a desert 

San Diego County residents are confronting a paradox: the region has never been more water-secure, yet costs are projected to soar dramatically over the next decade, with wholesale water rates potentially jumping from about $2,000 per acre-foot next year to anywhere from $3,500 to $5,000 per acre-foot by 2035.

The financial squeeze comes as the San Diego County Water Authority announced in October 2024 that the region has plenty of water to meet demands in water year 2025 regardless of weather conditions, thanks to regional investments in water reliability and two consecutive wet winters.


SIDEBAR: Water Prices in Other Mediterranean Climate Regions

How does San Diego compare globally?

San Diego's water costs are among the highest for regions with similar Mediterranean climates worldwide. Here's how other cities stack up:

California Cities

Los Angeles uses a four-tiered pricing structure, with the highest tier (Tier 4) increasing from $9.192 to $12.794 per 748 gallons as of January 2025, equivalent to approximately $1.71 per 100 gallons for high-volume users.

The Metropolitan Water District serving Southern California expects rates to increase 17% over two years, beginning with an 8.5% increase in January.

European Mediterranean Cities

Barcelona, Spain charges approximately €28.74 for 10 cubic meters (2,642 gallons) of water, inclusive of taxes and standing charges, working out to roughly $0.41 per 100 gallons.

For a typical household consumption of 175 cubic meters annually, Barcelona residents pay approximately €520 ($568), while other Spanish Mediterranean cities including Murcia, Alicante, and Palma exceed €400 per year.

Across 65 Western European cities, the average water price is €1.91 per 1,000 liters (264 gallons), with Mediterranean countries using increasing block pricing structures averaging €1.25 compared to €2.20 for linear pricing systems.

Perth, Australia

Perth implemented a 2.5% water rate increase from July 1, 2025, using a tiered pricing system for conservation. All Western Australia households pay a uniform annual service charge of $296.89 for 2025-26.

The Bottom Line

San Diego's current wholesale rate of approximately $2,000 per acre-foot translates to roughly $0.61 per 100 gallons. With projected increases to $3,500-$5,000 per acre-foot by 2035, costs could reach $1.07-$1.53 per 100 gallons—making San Diego's water among the most expensive in Mediterranean climate regions globally.

These comparisons are complicated by differing pricing structures, inclusion or exclusion of wastewater treatment, infrastructure costs, and local water scarcity conditions.

Pure Water Project Drives Costs and Controversy

At the heart of the cost increases is the city of San Diego's Pure Water program, a $5 billion sewage recycling system that recently saw another significant price increase, with the City Council approving an additional $50 million in January 2025 for a new pipeline and rehabilitation of an existing one.

When complete in 2035, Pure Water is expected to shrink San Diego's imported water share from about 85% to less than 50%, producing 87 million gallons per day across two phases. The project has faced multiple cost escalations, with $130 million added in 2021 and another $130 million in 2024.

The water recycling initiative has sparked political tensions. Jim Madaffer, one of the city's appointed representatives to the San Diego County Water Authority, recently published an opinion piece questioning the city's approach to water independence and defending the Metropolitan Water District, drawing sharp criticism from environmental advocates who say his statements undermine the city's negotiating position.

Marco Gonzalez, executive director of the Coastal Environmental Rights Foundation, called for Madaffer's replacement, arguing his loyalty should be to San Diego's residents rather than external agencies.

City Council Delays Rate Increase Vote

Facing public outcry, the San Diego City Council voted 8-1 on September 30, 2025, to delay a vote on water and sewer rate increases until October 28, pushing back a proposal that would raise water rates by 63% and sewer rates by 31% over the next four years.

The proposed increases would raise the average single-family household water bill by $18 per month starting in January, with the monthly water service charge increasing from $46.63 to $56.83 in January 2026.

The city's Independent Budget Analyst warned that higher rates are crucial to maintaining water system operations, calling fiscal year 2027 "the nadir as far as financial metrics for the system". The report emphasized that declining water sales and wastewater flows require rate increases to generate necessary revenue.

Metropolitan Water District Settlement Brings Stability

In a major development, the San Diego County Water Authority and Metropolitan Water District of Southern California announced in June 2025 the settlement of a 15-year legal dispute over water exchange rates, with San Diego agreeing to pay a fixed rate starting at $671 per acre-foot in 2026, adjusted annually for inflation.

Under the deal, San Diego's water authority will pay $152.3 million annually to secure 227,000 acre-feet of Colorado River water, with terms allowing San Diego to sell excess water back to Metropolitan or other member agencies. The settlement is expected to cost San Diego ratepayers an estimated $20 million in legal fees over the litigation's duration.

The Water Authority approved a 14% wholesale water rate increase for 2025, after initially projecting higher increases that were cut in half through federal grant funds, an innovative water transfer, and operating budget cuts.

Desalination Plant Adds to Financial Burden

The Carlsbad Desalination Plant, which cost approximately $1 billion for the plant, pipelines, and upgrades when it opened in December 2015, continues to be a significant expense. The plant is currently undergoing a $274 million upgrade to its intake-discharge system to comply with new state environmental regulations.

San Diego County Water Authority officials revealed in September 2025 that the region owes the privately-owned desalination plant over $35 million for water the company couldn't produce, with 10,105 acre-feet of unmade water banked due to construction shutdowns, power outages, and repairs.

Water Authority Seeks to Sell Surplus

To offset rising costs, the Water Authority announced in April 2025 that it is considering selling or leasing surplus water resources to other agencies, an initiative officials say could help lower water costs for San Diego ratepayers.

Despite receiving around half of normal rainfall in early 2025, officials said the region has more than enough water to meet demands through summer and fall, with county water officials reporting that water transfers in 2023 and 2024 saved San Diego ratepayers nearly $40 million.

East County Project Moves Forward

The East County Advanced Water Purification program received $86 million in funding from Metropolitan Water District and is scheduled to begin producing drinking water in 2025, expected to satisfy up to 30% of East County's drinking water demands. The project will eliminate the discharge of 15 million gallons of partially treated wastewater daily into the Pacific Ocean.

Political and Economic Implications

Water Authority Board Chair Nick Serrano, whose term began in October 2024, stated the region's water supply remains stable and reliable, committing to preserving stability while keeping water prices affordable.

High water costs in the San Diego region are driven by the Water Authority's outsized infrastructure, which was overbuilt to meet population growth and water demands that didn't materialize as conservation efforts improved, meaning debt servicing costs get passed to consumers.

The water authority projects that rates should rise between 5.5% and 9.5% annually over the next decade, compared to 14.8% in the previous year and 8.3% for next year, offering some stability following the Metropolitan settlement.

As the October 28 City Council vote approaches, officials face the challenge of balancing infrastructure investments, environmental mandates, and affordability concerns in a region where water reliability has become a $262 billion economic imperative.

Sources

  1. San Diego County Water Authority. "San Diego Region Well-Prepared for Water Year 2025." October 1, 2024. https://www.sdcwa.org/san-diego-region-prepared-for-2025/

  2. Elmer, MacKenzie. "San Diego County water costs could more than double over a decade, officials warn. Here's why." San Diego Union-Tribune, October 23, 2025. https://www.sandiegouniontribune.com/2025/10/23/san-diego-county-water-costs-could-more-than-double-in-a-decade-officials-warn-heres-what-could-impact-affordability/

  3. "San Diego Water Authority plans to sell surplus water, aims to lower costs." KGTV, April 2, 2025. https://www.10news.com/news/local-news/san-diego-water-authority-plans-to-sell-surplus-water-aims-to-lower-costs

  4. "San Diego region well-prepared for water year 2025." The Coast News Group, October 16, 2024. https://thecoastnews.com/san-diego-region-well-prepared-for-water-year-2025/

  5. Gonzalez, Marco. "San Diego Deserves Representation That Defends Its Water Future." Voice of San Diego, October 23, 2025. https://voiceofsandiego.org/2025/10/23/san-diego-deserves-representation-that-defends-its-water-future/

  6. San Diego County Water Authority. "New Revenues, Budget Cuts Trim Wholesale Rate Increase for 2025." July 25, 2024. https://www.sdcwa.org/revenues-and-cuts-trim-rate-increase-for-2025/

  7. San Diego County Department of Public Works. "East County Advanced Water Purification (ECAWP)." https://www.sandiegocounty.gov/content/sdc/dpw/wasteh2o/ECAWP.html

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  9. "Recycled water project nears milestone, costs escalate again." San Diego Union-Tribune, February 19, 2025. https://www.sandiegouniontribune.com/2025/02/19/recycled-water-project-nears-milestone-cost-escalate-again/

  10. Garrick, David. "San Diego launching Pure Water, largest infrastructure project in city's history." San Diego Union-Tribune, August 21, 2021. https://www.sandiegouniontribune.com/news/politics/story/2021-08-20/san-diego-officially-launching-pure-water-largest-infrastructure-project-in-city-history

  11. "San Diego City Council punts vote on raising water rates." Axios San Diego, October 1, 2025. https://www.axios.com/local/san-diego/2025/10/01/san-diego-city-council-pushes-vote-water-rates

  12. "San Diego City Council delays vote on water, wastewater rate hike." KPBS, September 30, 2025. https://www.kpbs.org/news/quality-of-life/2025/09/30/san-diego-city-council-considering-water-rate-hike

  13. Fox, Maura. "Big San Diego water rate hikes are 'crucial,' budget experts warn ahead of vote." San Diego Union-Tribune, September 29, 2025. https://www.sandiegouniontribune.com/2025/09/29/san-diego-water-rate-increase-budget-analyst-council-vote/

  14. "Claude 'Bud' Lewis Carlsbad Desalination Plant." Wikipedia, August 17, 2025. https://en.wikipedia.org/wiki/Claude_%22Bud%22_Lewis_Carlsbad_Desalination_Plant

  15. Toscano, Julia. "Carlsbad Desalination Plant Getting $274M Upgrade." San Diego Business Journal, March 22, 2023. https://www.sdbj.com/water-2/carlsbad-desalination-plant-getting-274m-upgrade/

  16. Elmer, MacKenzie. "San Diegans Owe a Desal Company $35 million for Unmade Water." Voice of San Diego, September 22, 2025. https://voiceofsandiego.org/2025/09/22/san-diegans-owe-a-desal-company-35-million-for-unmade-water/

  17. "San Diego County Water Authority and Metropolitan Water District End 15-Year Dispute with Settlement Agreement." Hoodline, June 26, 2025. https://hoodline.com/2025/06/san-diego-county-water-authority-and-metropolitan-water-district-end-15-year-dispute-with-settlement-agreement/

  18. Metropolitan Water District of Southern California. "Southern California Water Agencies End Lengthy Legal Dispute." August 4, 2025. https://www.mwdh2o.com/press-releases/southern-california-water-agencies-end-lengthy-legal-dispute

  19. Garrick, David. "San Diego County water officials just settled a 15-year-long rate dispute. Here's what it could mean for you." San Diego Union-Tribune, June 3, 2025. https://www.sandiegouniontribune.com/2025/06/02/san-diego-county-water-officials-settle-long-running-rate-dispute-after-15-years-and-tens-of-millions-in-legal-costs/

  20. "Domestic Water Charges in Europe." Public Policy Archive. http://www.publicpolicyarchive.ie/domestic-water-charges-in-europe/

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  22. "SoCal Water Rates." LAist. https://laist.com/brief/news/climate-environment/higher-water-rates-loom-socal

  23. "2025 Cost of living in Barcelona." Barcelona Tourist Guide. https://www.barcelona-tourist-guide.com/en/shopping/cost-of-living-barcelona.html

  24. "Spain's water is getting more expensive: the challenge of cost recovery." Smart Water Magazine, January 5, 2024. https://smartwatermagazine.com/news/smart-water-magazine/spains-water-getting-more-expensive-challenge-cost-recovery

  25. "Understanding your water use charges - Perth." Water Corporation. https://www.watercorporation.com.au/Help-and-advice/Bill-and-account/Rates-and-charges/Understanding-your-water-use-charges

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