2_Briefing regarding Council resolution on large volume water users — original pdf

Backup

Staff briefing regarding the July 23, 2026 Council resolution on large volume water users Austin Water | 10/28/2026 Water Forward Task Force Question  Request for background information with overall context regarding 7/23 Council Resolution. (Sarah Faust) 2 Timeline of Related Items  May 7, 2026: City Council approved Resolution Number 20260507-24 establishing an economic development framework, directing the creation of a comprehensive economic development policy, directing action on the position of Director for Austin Economic Development, and directing actions to improve economic development projects.  May 14, 2026: Austin Water provided Responses to Water Forward Task Force Large Volume Working Group Questions  May 18, 2026: Austin Water briefing to Climate, Water, Environment, and Parks Committee of Council on large industrial and commercial customer water usage and conservation trends  June 9,2026: Water Forward Task Force approved Recommendations to Council on Large Water Users  July 23, 2026: City Council Approved Resolution 20260723-087 directing the City Manager to present annual usage reports, evaluate impacts, incorporate water savings considerations as part of economic incentives, and make recommendations concerning large volume customers.  August 27, 2026: City Council Approved Resolution 20260827-061 - Approve a resolution initiating amendments to City Code Title 25 and other provisions of City Code or regulations necessary to establish land uses, site development regulations, and development processes, for data center use in certain zoning districts and to develop business regulations and permit requirements applicable to data center operations. 3 Council Resolution No. 20260723-087  Council Resolution No. 20260723-087 directed staff to:  Recommend a large-volume water customer application process, including defining customer criteria; requiring water-use estimates, conservation and reuse plans, and wastewater accounting; and assessing the need for NDAs and a Council escalation process.  Recommend water conservation plan requirements for existing large-volume customers.  Recommend updates to the drought contingency plan related to large-volume customers.  Recommend how large-volume customer policy should inform the City’s economic development policy and incentive process and address projects exceeding on-site reuse requirements.  Report to Council annually on large volume customer usage, with the first report due to the Climate, Water, Environment, and Parks Committee of Council no later than May 2027.  Propose a stakeholder input process to inform the development of standards for large volume user conservation plans and how to provide briefings to Council on upcoming applications.  Present how updates to the large volume water use policy will support Austin Water's cost of service studies and financial policies, to be used as a reference in developing Austin Water's 2029 rate case. 4 Water Forward Task Force Questions  Request to talk more about the 201,000 AF LCRA trigger in the discussion about large volume water users. (Jennifer Walker)  Is it correct that AW is currently pumping approximately 175,000 acre-feet per year and the LCRA payment trigger is 201,000 a-f per year, so we are approximately 26,000 a-f, or 8.4 billion gallons away from that trigger? (Sarah Faust) 5 1999 LCRA Agreement and Trigger Water Forward Task Force Questions  What are future use projections for potable water by sector over the applicable time period until the 201,000 a-f threshold projected to be met? (Sarah Faust)  What does AW expect water use to look like in the future? (Sarah Faust) 7 Water Forward 2024 Projections Projected Diversions After Conservation and Reuse Strategies are Implemented 300,000 250,000 200,000 150,000 100,000 50,000 t e e F - e r c A n i i n o s r e v i D 0 2020 2030 2040 2050 2060 2070 2080 Low Med High 8 Water Forward 2024 Projections Future Baseline Water Consumption Breakdown for 2040 in a Medium Projection Scenario 9 Water Forward Task Force Question  How is Austin Water thinking about types of industry we haven't previously seen but have a larger per square foot thermal footprint and potential exponential water use? See page 4 and 5 of WFTF June 9 recommendation. (Sarah Faust) 10 Water Forward 2028 Update Process Update Water Demand Projections  Austin Water has begun preliminary model script updates and input development work  Staff will be ready to present on baseline demand projections in Spring 2027 Define our values and future water needs Identify and characterize potential strategies Develop and evaluate portfolios of strategies Select the best portfolio and implementation approach 11 WF24 Demand Model Components 12 Water Forward Task Force Questions  The Large Water Customers 5-year data slide presented to WFTF and CWEP shows 11 customers and the lowest volume user using 183,924 million gallons per year. How many additional customers meet the current 85 million gallons per year threshold? What are the use volumes? How many of these use non-potable and how much? (Sarah Faust)  Request for list of the current customers that hit the current 85 million gallons per year threshold. (Sarah Faust) 13 Large Water Customers Five-Year Comparative Data (2021-2025) (in thousands) Customer Customer Class 2021 Gallons 2022 Gallons 2023 Gallons 2024 Gallons 2025 Gallons Samsung Austin Semiconductor Large Volume 2,209,533 2,383,134 2,475,074 2,361,100 2,230,946 Travis County WCID #10 University of Texas (1) NXP USA INC (Formerly Freescale, Inc.) (2) Tesla Motors, Inc. (3) Wells Branch MUD North Austin MUD #1 Wholesale Large Volume Large Volume Commercial Wholesale Wholesale Cypress Semiconductor (Formerly Spansion) Large Volume Austin Independent School District (4) Northtown MUD Mid America Apartments LP Commercial Wholesale Multifamily 753,560 520,519 648,249 1,258 456,577 400,097 332,495 224,754 317,037 241,296 908,379 650,782 745,931 128,143 488,547 461,390 348,005 296,899 318,331 233,526 897,142 846,738 740,867 318,332 383,265 379,901 391,386 312,320 314,571 203,175 835,371 976,550 665,478 374,982 426,074 413,129 357,325 302,906 337,180 183,924 899,768 858,617 547,050 544,342 466,788 431,373 353,836 334,779 329,625 196,791 Total (5): 6,105,375 6,963,067 7,262,771 7,234,019 7,193,915 (1) Totals for the University of Texas include all accounts. (2) Totals for NXP USA, Inc. include their East Austin plant site and their West Austin plant site. (3) 2023 was the first year that Tesla Motors, Inc. was a Top 10 customer. 2021 is the first-year data was collected. (4) Totals for Austin Independent School District include all campuses and locations. (5) Total may not add due to rounding. Source: Austin Water. 14 Water Forward Task Force Questions  How long has the current large volume threshold been 85 million gallons per year? What were the reasonings? (Sarah Faust)  What was the rationale for the original 85 million gallon per year threshold? When was it adopted? (Sarah Faust)  Has high volume water use threshold in the past (85 million gallons per year) included non-potable water or was this just potable users? (Sarah Faust)  Does AW currently define the threshold as potable and non-potable? (Sarah Faust) 15 History of Large Volume Threshold • Austin Water developed the large volume customer definition in the early 1990s when the rate class was created. • Staff organized the annual potable water use for commercial customers from largest to smallest to analyze breaks and clusters in the data. • Most customers used under 65 MGY, with a 30 MGY gap before the next group of high-use customers, which included chip manufacturers using around 100 MGY. • Staff set the large volume threshold at 85 MGY, midway between the two groups. • This threshold captured the top 10–11 customers whose usage differed significantly from the rest of the commercial base. • The 85 MGY threshold was formally adopted in City ordinance with the creation of the rate class. 16 Water Forward Task Force Question  Can you prepare the 2025 Total Water Use in Austin chart from the Open House Boards but with non-potable, so that we can compare users above the threshold at potable only? Also, break the chart down by number of users per category and use volumes per user (for the largest users). Rationale: if you have a customer using a large proportion of recycled water that over the 85 million gallons threshold, and a user with a large proportion of potable water over the threshold, the user maximizing recycled has already invested in additional infrastructure and effort and should not be considered in the same category as they are helping to conserve potable water. (Sarah Faust) 17 2025 Water Demands By Sector 2025 Total Water Use in Austin - Potable Only Commercial 22.2% High Impact - Commercial 11.2% Wholesale 6.6% High Impact - City of Austin 0.6% City of Austin 1.3% Residential 58.1% Residential City of Austin High Impact - City of Austin Wholesale High Impact - Commercial Commercial 18 Water Forward Task Force Questions  What are the goals for the AW proposed new large user threshold (draft definition)? Is the proposed definition of high impact water user and threshold designed to decrease reliance on potable water by new high water usage customers? How does it do that? (Sarah Faust)  Suggest a lower threshold to catch those who may intentionally use just under the proposed threshold to get out of additional requirements. (Paul DiFiore)  What other thresholds did Austin Water consider? (Sarah Faust)  Can AW consider two thresholds, one for potable only and one for combined? In looking at the Open House Board 2025 Total Water Use in Austin, this is showing high impact as potable and non-potable. (Sarah Faust) 19 Evaluation of Customer Water Use 20 Water Forward Task Force Question  As Tesla is the fastest growing water user, what are their future water use projections? Potable and non-potable? (Sarah Faust) 21 Water Forward Task Force Questions  Recommendation to require closed loop cooling and to revisit all 6/9 WFTF recommendations to Council. (Sarah Faust)  What is the standard that will be used to assess High Impact Waser User demand lowering? (Sarah Faust) 22 Questions and Discussion Austin Water | 10/26/2026