SAN DIEGO -- A crucial vote on a controversial desalination plant has been delayed until next month, as a government agency grapples with how much environmental compensation to require.

The San Diego Regional Water Quality Control Board voted Wednesday to put off its decision until May 13, to give its staff time to draw up the compensation plans. The board closed the hearing, meaning no new evidence or testimony will be considered at the next meeting.

Poseidon Resources Corp., the plant's prospective builder, made encouraging progress at the hearing, said Scott Maloni, a vice president of the Stamford, Conn.-based company.

"We think it's a significant milestone," Maloni said. "They ended the public debate over the project, and they agreed to come back next month and make a decision. The time delay is insignificant in comparison to the milestone of the public debate coming to a close."

Poseidon intends to build the $300 million desalination plant on the Carlsbad coast, next to the Encina Power Station. If built, it will have a capacity to convert seawater into 50 million gallons a day of drinking water, or 9 percent of the water consumed in San Diego County.

Carlsbad and eight other local water agencies have contracted with Poseidon to buy its output.

Advocates have argued that the region, which locally collects little of the water it consumes, faces severe shortages, with distant sources projected to be increasingly stressed by drought and environmental restrictions. Opponents have argued that there is vast potential for conservation, making expensive desalination, reservoir and other projects unnecessary.

Environmental concerns

Poseidon has agreed to restore 55 acres of wetlands to compensate for environmental damage caused by the plant.

Control board staff members have said the company might have to restore up to double that area of wetlands to mitigate damage. The project's viability will be jeopardized if that is required, said Peter MacLaggan, a Poseidon senior vice president.

A couple of board members said they didn't want to require measures that would scuttle the project.

Environmentalist opponents of the plant such as Surfrider San Diego and San Diego Coastkeeper said the mitigation acreage should be increased and more stringent monitoring applied if the plant is approved.

Jared Criscuolo, a member of Surfrider's executive committee, said the group is not opposed to desalination in principle, but thinks the Poseidon project is the wrong way to do it.

Marco Gonzalez, an environmental attorney also speaking for Surfrider, said the desalination project could have been planned for anywhere in the service area of the Metropolitan Water District, Southern California's water wholesaler. Water could be exchanged via a paper transfer without physically producing water in Carlsbad, Gonzalez said.

Poseidon representative Christopher Garrett said Carlsbad needed the plant in that city to ensure a reliable local water supply.

Much of the meeting was spent discussing how to deal with an error in Poseidon's calculations, which underestimated the amount of "biomass" -- fish larvae -- that would be destroyed by the plant.

The board instructed its staff to consider how to compensate for the error and bring back recommendations at the May 13 meeting.

If the board approves the project at the meeting, Poseidon's next step will be to get financing, Maloni said. Poseidon has received five financing proposals from lenders, he said, and expects to find at least one acceptable.

Poseidon estimates the plant should be operational by the last quarter of 2011 or the first quarter of 2012.

Shortages threaten

As the desalination project has gone through its years-long approval process, San Diego County and all of California have had increasing difficulty supplying their water consumption.

Gov. Arnold Schwarzenegger declared California in a drought last year. This year, water rationing looms for Southern California because of supply shortages from both of its major sources, the Colorado River and the Sacramento River Delta.

"We are preparing to send out notices to 10,000 customers about mandatory cutbacks, starting in July of this year. If this project were online today, we wouldn't have to do that," said Gary Arant, general manager of Valley Center Municipal Water District.

Kimberly A. Thomer, general manager of Olivenhain Water District, held up two toy pelicans while pleading for human needs to take precedence over the needs of ocean wildlife.

"There are 300,000 human species (whose needs are being held up) by the diet of two pelicans," Thomer said, referring to the estimated destruction of "biomass" the plant would cause.

Other supporters speaking included representatives of San Diego County Water Authority, San Diego North Economic Development Council, San Diego Regional Chamber of Commerce, and State Sens. Christine Kehoe and Mark Wyland.

Contact staff writer Bradley J. Fikes at (760) 739-6641 or bfikes@nctimes.com. Read his blogs at bizblogs.nctimes.com.