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Short of water, California tries to drink the ocean

A seawater intake point for the Carlsbad desalination plant, which will eventually produce 50 million gallons a day of freshwater.A seawater intake point for the Carlsbad desalination plant, which will eventually produce 50 million gallons a day of freshwater.
A seawater intake point for the Carlsbad desalination plant, which will eventually produce 50 million gallons a day of freshwater.Damon Winter—Redux

Israeli Prime Minister David Ben Gurion, in a speech some 60 years ago, implored his nation’s scientists to find a cheap way to turn the Mediterranean into potable water. Today that small, rain-deprived country gets more than one-quarter of its H2O supply from treated salt water.

California, now in its fourth year of a devastating drought, may follow a similar trajectory. In April, Gov. Jerry Brown made a Ben Gurion–like plea, ordering state agencies to accelerate the use of cutting-edge technologies to bolster the water supply. That call turned into a tacit blessing for efforts like the Carlsbad Desalination Project, just north of San Diego, the largest desalination facility in the Western Hemisphere. The plant has been in the works for nearly two decades, with construction costs of $1 billion so far. After years of permit purgatory and lawsuits, it will finally go live this fall. By 2020 it is expected to provide upwards of 50 million gallons of fresh water daily, meeting about 10% of San Diego County’s water demand.

The site’s impact and cost will be closely watched. The drought has wreaked havoc on the state’s enormous agriculture industry. It’s expected to cost the state’s economy $2.7 billion this year alone, and it’s contributing to rising food prices nationwide. And the Golden State has 800 miles of coastline—abutting a seemingly endless supply of potentially potable water.

Still, less than 1% of California’s water supply comes from the ocean, and moving that needle higher may prove challenging. Desalination involves pumping seawater through high-pressure tubes and polymer-made membranes in order to separate the dissolved salt ions—a procedure that’s both costly and energy intensive. It also leaves behind a concentrated brine that is pumped back into the ocean—another process whose ecological impact worries conservationists.

Necessity, however, is the mother of invention, and it sometimes trumps environmental anxiety. That’s how the world’s largest desalination plant came to be located in Israel, 60% of which is covered by desert. About 10 miles south of Tel Aviv is the Sorek plant, which went live in 2013. It was built by Israel Desalination Enterprises, an engineering firm that is providing some of the technology for the Carlsbad plant, in partnership with Poseidon Water, the Boston-based company spearheading the privately funded project. Other Israeli developers of water-conserving technologies are also vying for contracts in California.

Saudi Arabia, India, and Australia now have working desalination plants. And Florida, Texas and other states are considering expanding their use of the technology. But desalination is just one aspect of addressing water scarcity, and the high cost and relatively modest production of the Carlsbad plant suggest its limits. And Israel, it’s worth remembering, has an advantage over California: For security reasons, its water system (including its vast aquifers) is run by a single, central government planning body. That’s something California—whose water supply is spoken for by thousands of disparate public agencies and private owners—will have a hard time emulating. Desalination is, at most, “a security blanket,” says Seth Siegel, a water-policy activist and author of the book Let There Be Water, to be published in September. “There is no silver bullet.”

MAC.07.01.15. Water and cash flow

A version of this article appears in the July 1, 2015 issue of Fortune magazine with the headline ‘Can We Drink the Ocean?’