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Central Arkansas Water Renovates Treatment Plants, Goes SolarLock Icon

6 min read
CAW OZARK POINT WATER 133050
Tad Bohannon, CEO of Central Arkansas Water, at the Ozark Point treatment plant in Little Rock. ( Jason Burt)

Generating a to-do list has never been an issue at Central Arkansas Water. The largest supplier of water in Arkansas operates and maintains a 2,527-mile pipeline network supported by 25 remote booster pumping stations and 29 remote storage facilities.

Something is always marked for repair, replacement, updating or expansion to keep the water flowing to 500,000 consumers while keeping an eye on future demands.

“We have great water quality, but how can we make it better?” asked Tad Bohannon, CEO of the $535 million-asset nonprofit utility.

The biggest ticket item among ongoing, unfinished improvements is renovation of Ozark Point, CAW’s ridge-top complex in Little Rock’s Hillcrest neighborhood.

The water treatment facility was taken offline recently to complete an extensive up-grade that includes installation of a 1,250-kilowatt emergency generator and a 60-kilowatt rooftop-mounted solar array.

The $32 million project to add new efficiencies began life as part of CAW’s 2010 master plan. Construction began in September 2019 when the water treatment plant was taken offline to build new sedimentation basins.

As a first step in the treatment process, the large concrete basins allow heavy particulates to settle out from water that flows into Ozark Point from 35 miles away at Lake Winona in the Ouachita National Forest.

The longtime source of treated water for much of Little Rock and North Little Rock resumed production in May to help meet the high-demand summer months. But plant operations were limited to half the daily capacity of 24 million gallons, so construction could keep moving forward.

“This project will wind up in late spring,” Bohannon said. “They’re supposed to be out of here by May.

“The pipeline from Lake Winona is gravity fed to Ozark Point, so the water keeps coming once you open up the system and you have to match the output with the input. We don’t like to have to turn off the flow unless we have to.”

Water from Ozark Point can be pumped up to the water tower at the northwest corner of Pierce and W streets in the Heights neighborhood. Most is bound to continue the downhill flow to the flatter topography of points east and south to downtown Little Rock, downtown North Little Rock and beyond.

CAW plans to start the second phase of its $6.6 million pump modernization project at its main water treatment plant next year. The Jack H. Wilson facility in west Little Rock can process 130 million gallons daily from Lake Maumelle, the largest source of CAW water.

CAW has a year-end deal in the works to buy a 73-acre tract in the Ferndale area of west Pulaski County as a future site for a treatment plant.

CAW OZARK POINT WATER 133050
The old Little Rock water treatment building at Ozark Point (foreground) hasn’t seen service in years. These days, its sedimentation basin functions as a storage yard for Central Arkansas Water and a construction staging area for ongoing upgrades at its successor facility in the background. ( Jason Burt)

Rural Consolidation

June 1 marked the COVID-19-delayed merger of the Paron-Owensville Water Authority with CAW. The ongoing cost and regulatory demands of maintaining and operating the rural system made the move financially imperative.

“It’s basically economics,” said Curt Malone, former president of the Paron-Owensville Water Authority. “Our philosophy has always been to provide customers with the best quality water at the most affordable price. To keep doing that, we needed to expand our customer base. It’s the only way to keep our costs down. It soon became apparent that the logical choice was to merge with someone like CAW.”

The authority provided water to about 930 accounts representing a population of about 2,000 in the Paron-Owensville area of Saline County.

“We’re a small water system with two full-time employees that started in 1988,” Malone said. “It took us about 12 years to get online and all the pipe in the ground.

“But we had quality issues at the far end of our system that were not acceptable, so we built a water treatment plant that came online in 2015.”

The Paron-Owensville Water Author-ity initially sourced its water from Lake Ouachita. The rural system switched to buying wholesale water from CAW in April 2014. That 20-year deal established a minimum-maximum commitment of 25,000-500,000 gallons daily from nearby Lake Winona.

While CAW has assumed day-to-day management of Paron-Owensville, the authority’s ratepayers will pay a monthly surcharge to cover its pre-merger debt and the cost of regulatory compliance maintenance.

That monthly surcharge translates into $5.50 through December 2021, which increases to $11 until the 30-year bond issue of $6 million is paid off.

Bohannon expects more consolidation to occur in Arkansas as part of a nationwide trend of small systems contending with the cost of maintaining a water network and a limited customer base.

“Arkansas has a population of 3 million with over 700 water systems,” he said. “We have more water systems than school districts. That is not sustainable. You gain no economies of scale. Many of the systems are reliant on grants from state and federal sources.”

Sunshine & Watershed

CAW is in a holding pattern with the Arkansas Public Service Commission to move on its 4.8-megawatt solar farm on the edge of Cabot.

“We’re just waiting on the PSC to rule on our application for net metering, so we can start using solar to power our system pump stations and buildings,” Bohannon said. “We’re looking forward to that.”

The 12,300-panel array has the capacity to reduce CAW’s annual Entergy bill by 23%. That’s a savings of about $667,000 based on the water company’s $2.9 million electric bill with the utility during the fiscal year that ended August 2019.

The solar project will occupy about half of the 74-acre site that CAW acquired for about $600,000 last year. For now, the utility will buy the electricity produced from the array’s owner-developer Scenic Hill Solar of North Little Rock. CAW has an option to acquire the solar project for $4.6 million after five years.

“Our only commitment is to buy the power that comes off it,” Bohannon said. “2028 would be the first year to consider buying. Does it make economic sense to do it, or does it make more economic sense to just keep buying the power?”

CAW is 4,283 acres into a 4,500-acre purchase program in Pulaski County envisioned to offset the impact from legacy ownership of developed property in the Lake Maumelle watershed.

Its last big land deal closed at $2.3 million in December 2018 for nearly 355 acres owned by PotlatchDeltic Timber.

In addition to acquisitions, CAW also has negotiated conservation easements on 528 acres. Bohannon has hopes of creating 300-foot buffers along watershed tributaries on land currently in private ownership through more conservation easements or acquisitions.

“We’re working with other entities to work out other ways to possibly purchase more watershed land with carbon credits, federal grants, green bonds and conservation partners,” Bohannon said. “We’ll continue to look and explore other options that are not ratepayer-funded.”

All told, the water utility owns about 11,000 acres in Pulaski County, not counting 8,900 acres covered by Lake Maumelle and contained within its 70-mile shoreline.


Central Arkansas Water
Operating Revenue (in thousands)

 

2019

2018

2017

2016

Little Rock water sales

$32,376

$33,935

$30,210

$29,905

North Little Rock water sales*

$14,181

$14,969

$13,461

$13,525

Ancillary charges**

$8,819

$6,769

$7,308

$6,575

Wholesale

$4,649

$4,759

$4,206

$3,721

Maumelle water sales

$3,433

$3,601

$3,771

$4,453

Turn-on charges

$1,403

$1,335

$1,343

$989

Penalties††

$1,020

$991

$923

$879

Other revenue

$552

$561

$612

$819

Total Operating Revenues

$66,433

$66,920

$61,834

$60,696

Net Cash from Operations

$19,362

$22,363

$21,115

$18,631


*Includes Sherwood.
**Connection fees and watershed protection fees are two of the biggest items.
Jacksonville and Bryant are the two biggest customers who buy water for their city-owned system.
††10% late payment charge.
Source: Central Arkansas Water
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