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Sonoma Water warns Potter Valley uncertainty could affect regional supply, urges continued planning
Summary
Sonoma Water told supervisors its operating and grant‑funded programs are under pressure and that developments around PG&E and Potter Valley are "high stakes," potentially altering reservoir operations and long‑term supply. The agency urged continued contingency planning, federal/state advocacy and funding pursuit.
Sonoma Water Director Grant Davis told the Board of Supervisors that the agency faces mounting budget and project risks even as it works to preserve water reliability for more than 600,000 residents and businesses.
"We supply clean, reliable drinking water to over 600,000 residents and businesses every day," Davis said, framing the presentation of Sonoma Water's $256 million operating budget and the utility's list of capital and grant projects. Jake Spalding, the agency's director of financing, said Sonoma Water currently manages 37 active grants totaling roughly $70 million and continues to pursue state and federal funding for transmission, seismic retrofits and conservation projects.
Why it matters: Sonoma Water is a major regional wholesaler and a change in its funding or operating authority could affect rates, service levels and long‑term reliability across the North Bay. Board members pressed the agency for clarity about a recent, widely circulated report that a buyer might be interested in PG&E assets connected to Potter Valley.
Davis called the Potter Valley/PG&E developments "high stakes," describing a timeline in which PG&E's surrender application and any sale or transfer of assets could trigger Federal Energy Regulatory Commission review and materially affect regional water negotiations. "What the Secretary is thinking and what PG&E is going to do," Davis said, "is something we're in there working jointly with PG&E on securing the pathway forward."
Sonoma Water defended recent operational innovations designed to increase yield without building new dams, including FIRO (Forecast‑Informed Reservoir Operations). The utility said FIRO has allowed them to hold back roughly 30,000 acre‑feet of additional water across Lake Mendocino and Lake Sonoma this year, while noting the system's annual water rights still total about 75,000 acre‑feet and the county typically sells about 40–42,000.
Board members asked how Potter Valley outcomes would alter those figures. Davis said Potter Valley's resolution would "affect us dramatically" and that Sonoma Water continues to plan multiple contingencies — including feasibility work for secondary outlets at Lake Sonoma and advancing grant requests — but stressed many outcomes depend on decisions outside the county's control.
What's next: Sonoma Water flagged a likely need for continued federal and state advocacy and for staggered capital funding to cover projects such as seismic retrofits and transmission upgrades. The agency is scheduled to present additional technical briefings and a detailed Urban Water Management Plan to the board in May.
