1 Poseidon Resources (Channelside), LLC Carlsbad Desalination Project Marine Life Mitigation Plan (MLMP) Marine Life Mitigation Site Selection and Preliminary Restoration Plan May 15, 2010 Agenda Item F5a

2 MLMP Acreage Requirements  MLMP approved in 2008  Requires up to 55.4 acres of estuarine wetland restoration  37 acres in Phase I  Up to 18.4 acres in Phase II  Poseidon voluntarily offered 11 additional acres of mitigation (5.5 acres in each phase)  Total of up to 66.4 acres of wetland restoration now required

3 Only Site Selection and Preliminary Plan are Before the Commission  MLMP Section 2.0 (Site Selection) requires :  “[T]he permittee shall submit the proposed site(s) and preliminary wetland restoration plan to the Commission for its review and approval or disapproval.”  “The basis for the selection shall be an evaluation of the site(s) against the minimum standards and objectives set forth in subsections 3.1 and 3.2 below.”

4 Restoration Plan Development is a Thorough, Multi-Step Process  Evaluation of 11 sites – Completed  Agency consultation – Completed  Required submission of site selection and Preliminary Plan – Completed  Site and Preliminary Plan Approval - Today  Environmental Review of Final Plan - Future  Commission consideration of Final Plan - Future  Will include confirmation that Plan fully satisfies all MLMP requirements

5 MLMP Site Selection Requirements  MLMP required:  Evaluation of 11 sites in the Southern California Bight  Evaluation against minimum standards and objectives  Consideration of input from Commission staff and Commission’s Scientific Advisory Panel

6 Site Selection and Preliminary Plan are Products of Extensive Consultation  Poseidon evaluated sites and developed Preliminary Plan based on extensive consultation with:  U.S. Fish & Wildlife Service (USFWS)  California Department of Fish & Game (CDFG)  San Diego Regional Water Quality Control Board staff  Commission staff and the Commission’s Scientific Advisory Panel  All agencies consulted concur with selection of Otay River Floodplain site

7 Otay River Floodplain Site  Located in San Diego National Wildlife Refuge  Former intertidal mudflats and salt marsh  USFWS manages entire site exclusively for restoration  Poseidon would partner with USFWS to:  Protect, manage, enhance and restore open water coastal wetlands and native upland  Benefit native fish, wildlife and plant species in Refuge  Provide habitat for salt-marsh dependent species

8 Otay River Floodplain Site Location Site is located in the South San Diego Bay Unit of the San Diego National Wildlife Refuge.

9 All Required Sites Were Evaluated  Poseidon evaluated the following 12 potential sites:  Tijuana Estuary in San Diego County  Otay River Floodplain in San Diego County  San Dieguito River Valley in San Diego County  Agua Hedionda Lagoon in San Diego County  San Elijo Lagoon in San Diego County  Buena Vista Lagoon in San Diego County  Huntington Beach Wetland in Orange County  Anaheim Bay in Orange County  Santa Ana River in Orange County  Los Cerritos Wetland in Los Angeles County  Ballona Wetland in Los Angeles County  Ormond Beach in Ventura County

10 How Did Sites Compare?

11 Only Otay River Floodplain Site Ranked “High”  Basis for Otay River Floodplain site ranking:  Restored intertidal mudflats provide breeding habitat for goby species impacted by Carlsbad Project  Provides opportunity for all 66.4 acres at a single site  Approved Comprehensive Conservation Plan (CCP) and Environmental Impact Statement (EIS) provide a framework for how the site should be restored  Site best complies with MLMP’s minimum standards and objectives –Including likely delivering Final Restoration Plan to the Commission within 2 years  USFWS partnership enables long-term protection

12 Other Site Advantages  No hard structures such as jetties are needed  Maintenance dredging would not be required  Buffer requirements can be met  Would restore site where no other funding source exists

13 Conceptual Site Plan 13

14 Otay River Floodplain Site Supporters  USFWS  CDFG  San Diego Regional Water Quality Control Board staff  Commission staff  Commission’s Scientific Advisory Panel  Coastal Conservancy

15 Additional Slides

16 USFWS Support  “Our collaboration with Poseidon Resources will allow the restoration and monitoring of significant salt marsh and estuarine habitats in a timely and efficient manner without the expenditure of public funding. We continue to strongly support this project...”  (Sept. 28, 2010 Letter to Commission staff)

17 CDFG Support  “The Department concurs that South San Diego Bay NWR is an important project location and mitigation would be valuable there... We look forward to the opportunity to assist Poseidon in optimizing its mitigation strategy for the proposed desalination plant.”  (Mar. 18, 2010 Letter to Commission staff)

18 Regional Board Staff Support  “On July 29, 2010, Poseidon submitted a proposed mitigation site at the Otay River Floodplain... We will be recommending approval of the proposed mitigation site.”  (Sept. 21, 2010 Letter to Commission staff)

19 Commission Staff Support  “[T]he Otay River Floodplain site has the greatest likelihood of meeting the requirements and objectives of the MLMP.”  “The site contains enough area to meet the acreage requirements in the MLMP, including space for transition and buffer areas.”  (Sept. 22, 2010 Staff Report)

20 South Bay Power Plant Location South Bay Power Plant South Bay Power Plant Location

21 Request  Poseidon concurs with Commission staff’s recommendation  Poseidon requests that the Commission:  Approve the proposed Otay River Floodplain site and Preliminary Restoration Plan under the MLMP for both Phase I and Phase II restoration obligations