L.A.'s New Scheme to Plunder Owens Valley Water, This Time with Solar Panels

The city of Los Angeles recently announced plans to transform Owens Valley into one of the largest sources of solar power in America, outfitting the region with a massive energy farm that would span 80 square miles and generate up to 10 percent of California's total electricity output. It truly is a monster, able to generate as much as 5 gigawatts of electricity, enough to power 1.5 million homes, dwarfing China's plans to build the world's biggest solar farm by a factor of three.

The scale of this energy farm would make a solar panel manufacturer drool: while its total cost has not been disclosed, a test section 1/600th of the project's final size is expected to cost $50 million. The hefty price tag is why L.A.'s Department of Water and Power (DWP), the city's giant utility that will build and operate the solar farm, is eager to get cranking, afraid of missing its opportunity to tap into the lucrative government subsidies being handed out for solar and other green energy projects before they disappear.

On February 2, DWP general manager David Freeman made the 250-mile trip to the Owens Valley to sell the locals on the plan, pitching it as a sure way to create jobs in the depressed rural region, increase local tax revenues and save their environment.

“It's a triple hitter," he said, trying to convince Owens Valley residents why they shouldn't object to a solar farm being built in their community. "I want this project to benefit the people up here in every way we can think of."

In reality, the project would benefit L.A. more than anyone else. DWP does not plan on transmitting the electricity it produces to Los Angeles directly, nor does it plan to share some of it with Owens Valley. Instead, the agency plans to do something much more lucrative: sell the power on the open market to utility giants like Edison Co. and Pacific Gas & Electric and send a big chunk of the profits to Los Angeles. In 2009 alone, it contributed nearly $200 million to Los Angeles' general fund. DWP is a money-maker for L.A., and the city wants to expand the utility's business horizons.

But there is another side to the story that Freeman and the other Los Angeles bosses won't tell you: The project is as much about making money off green energy as it is about old-school plunder, about how one mighty municipality hijacked water from one of the most beautiful regions in California to make L.A.'s early-20th century real estate tycoons even richer. It's a plunder that keeps on giving.

The groundwork for L.A.'s looting happened almost a century ago. At the time, the city's population was exploding, doubling every couple of years, feeding a real estate market that was entering hyper-bubble territory. The city's land-owning tycoons -- like Los Angeles Times owners Gray Otis and Harry Chandler -- needed all the water they could get to feed this bubble. That's when they set their sights on Owens Valley, located in the Sierra Nevadas 250 miles away from Los Angeles. The 14,000-foot mountains that surround the valley collect rain and snow, feeding it into the Owens River and Owens Lake. If tapped with an aqueduct, the valley could supply more than one million people and require no pumping. Because the valley sat 4,000 feet above sea level, water would simply flow downhill.

The city sent thugs and operatives to the Owens Valley to secretly buy up land and mount a hostile takeover of its water, bribing, scamming and roughing up anyone who tried to resist. In 1913, the water started to flow. With no pesky liberal environmentalists around (and just a few pissed-off Owens Valley farmers armed with guns and dynamite), L.A. managed to transform the valley into an arid wasteland, draining Owens Lake in the space of a decade and making the region inhospitable to agriculture. It became the most infamous water grab in American history, and the inspiration for Roman Polanski's Chinatown.