Delta Conveyance tunnel project cost jumps to $20 billion

A drone view of the Bethany Reservoir, impounded by five dams in Alameda County, serves as a forebay for the South Bay Pumping Plant and afterbay for Banks Pumping Plant. Photo taken March 28, 2024. Sara Nevis / California Department of Water Resources

California Construction News staff writer

The estimated cost for the Delta Conveyance tunnel project has jumped to $20 billion from the original $16 billion price, the state Department of Water Resources (DWR) confirmed in an analysis release last week.

The project includes constructing a 45-mile tunnel to channel water from the Sacramento River beneath the Sacramento-San Joaquin River Delta to a pumping station in Tracy. Approved in December, it will divert water through the State Water Project to Southern California.

Supporters say the tunnel is needed due to severe water supply challenges exacerbated by climate change. However, construction is opposed by environmental groups, Native American tribes, and other stakeholders concerned about the potential impact on native fish populations and farmland.

The benefit-cost analysis for the Delta Conveyance Project finds the infrastructure modernization project would create billions of dollars in benefits for California communities, including reliable water supplies, climate change adaptation, earthquake preparedness and improved water quality.

For every $1 spent, officials say $2.20 in benefits would be generated. The report also shows the very real cost of doing nothing, posing significant future challenges to supplying water to California communities.

“The Delta Conveyance Project passes the benefit-cost test readily, with benefits that are more than double the cost,” said Dr. David Sunding, Emeritus Professor, UC Berkeley, who led the benefit-cost analysis. “The project enables ongoing demands to be satisfied and water supply reliability to be maintained,” he said, adding “the benefits clearly justify the costs.”

The DCA conducted a preliminary value engineering exercise to identify design and construction innovations that could cut costs, save time, and reduce risks. These engineering innovations, while not representing changes to the approved project description, do show that there is genuine potential for a significant cost reduction of about $1.2 billion even at this early stage of project development.

Some examples of the DCA’s recommended design and construction innovations include:

  • Optimize the Bethany Reservoir Pumping Plant belowground configuration to reduce construction effort and house the pumping plant equipment and piping more efficiently.
  • Consider the latest tunnel boring machine technology that allows excavation and lining installation to happen concurrently.
  • Raise the elevation of the intake screens to create more separation from the river bottom, improving O&M and reducing the depth of the intake structure.

“We are committed to bringing substantial and tangible benefits to the communities in the project area that will see the most impacts from construction,” said Carrie Buckman, DWR’s Environmental Program Manager for the Delta Conveyance Project.

The Community Benefits Program is a recognition that while the benefits of the project are in other parts of California, the construction effects are local. While DWR remains committed to all mitigation adopted to address local environmental impacts, the Community Benefits Program will provide a grant fund for local projects, in addition to business development set-asides for job training and local business utilization, and potential “leave-behinds” like broadband or other infrastructure.


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