PADRE DAM

2015 Annual Report

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LET TER from the CEO / General Manager Our Water Future IS BRIGHT! This fiscal year was occupied with a fourth year of drought, the driest year in California's history, and unprecedented State Emergency Water Use Regulations. Padre Dam currently imports 100 percent of our water supply. The challenges of reduced water supply availability and declining water sales remind us of the importance of our strategic goal to increase our water supply independence through development of local water supplies. Customers have responded to the drought by reducing water use by more than 28 percent compared to the same period in 2013. This savings far exceeded the District's State mandated target of 20 percent. It is evidence that the water landscape is changing and residents are making permanent changes to their water use. This is a key consideration as the District continues to plan for our water future. California's severe drought brings into focus the importance of Padre Dam's efforts to develop a local water supply with our Advanced Water Purification Project. This year marked the start of this innovative project with the goal of developing a new local, reliable water supply source for East County. The Grand Opening of our demonstration facility in April 2015 could not have come at a more appropriate time on the heels of the lowest recorded snowpack in California's history. The full scale Advanced Water Purification Project has the potential to be a reliable, drought-proof water source providing up to 30 percent of Padre Dam's current drinking water supply. The Advanced Water Purification Project is more than a water system improvement project – though it is that – it's a project that has the potential to increase water reliability and provide a much needed local source of water for East County. • It exemplifies creativity in looking at the problem we have – living in an arid region, lacking natural rainfall to support the population we have and creatively engineering a solution. • It represents innovation – being willing to embrace new technology and think differently. • It exemplifies a commitment to do what's right – being environmental stewards and using our precious resources as wisely and prudently as we can. This state-of-the-art project builds on the District's long history of water reuse innovation. Water reuse through recycled water has been a part of Padre Dam's culture since the late 1950's with the creation of Santee Lakes. Despite unprecedented water conditions, we remained committed and dedicated to our mission of providing reliable, high quality water, recycled water, and wastewater services in a cost effective and responsible manner. We did this while maintaining the highest quality and reliability standards through replacement and maintenance of our complex water system to protect the integrity of approximately $700M in infrastructure assets. In this time of severe drought, it is outstanding that I'm able to say…Our Water Future IS BRIGHT! Best Regards, Allen Carlisle CEO / General Manager ~ 3 2015 Annual Report

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