San Diego secures 27% unit cost reduction in $62.4m wastewater odor control contract

San Diego secures 27% unit cost reduction in $62.4m wastewater odor control contractThe City Council awards a long-term operations and maintenance agreement to US Peroxide that bucks inflationary trends, alongside authorizing a $50 million State Revolving Fund loan for trunk sewer upgrades.

Council approved a $62.4 million contract with US Peroxide, LLC for hydrogen sulfide odor control at wastewater facilities.

Councilmember Marni von Wilpert highlighted a 27% unit cost saving for hydrogen peroxide and 17% for ferrous chloride.

A Clean Water State Revolving Fund loan of up to $50 million was authorized for the Alvarado Trunk Sewer Phase 4 Project.

Construction management contracts for the Pure Water Program were extended with a combined value increase of $9.6 million.

Contractors OHLA USA, W.A. Rasic, and PCL Construction received time extensions for Pure Water Phase 1 projects.

The City of San Diego City Council voted on February 10, 2026, to approve a suite of significant investments in water and wastewater infrastructure, headlined by a new operations and maintenance agreement for odor control that officials touted for its favorable pricing. The Council authorized an agreement with US Peroxide, LLC (doing business as USP Technologies) for a full-service hydrogen sulfide odor control program at Public Utilities Department wastewater facilities. The contract carries a total not-to-exceed value of $62,442,415.28. The company has previously managed similar chemical dosing operations for major municipalities, including the City of Portland and the Hyperion Treatment Plant in Los Angeles, utilizing hydrogen peroxide and iron-based products to mitigate odors and prevent corrosion. During the consent agenda discussion, Councilmember Marni von Wilpert noted the rarity of approving a contract with "substantial cost savings" in the current economic climate. She cited estimates indicating a 27% cost savings to the city per gallon for hydrogen peroxide and a 17% savings per dry ton for ferrous chloride compared to the previous arrangement. Von Wilpert praised the Public Utilities Department for its work in securing the price reductions, calling the contract "huge news" for the city's ability to maintain drinkable and clean water systems efficiently. In a separate action during the afternoon session, the Council authorized the application for a Clean Water State Revolving Fund (SRF) loan to fund the Alvarado Trunk Sewer Phase 4 Project – Package A. Department of Finance Financing Coordinator Kevin Werner presented the item, explaining that the loan amount is reasonably expected not to exceed $50 million. The financing carries a 30-year repayment term with an interest rate of 2.2%, which Werner noted offers favorable terms compared to market rates. The project is designed to increase sewer capacity by replacing outdated trunk sewer infrastructure. The Council also approved several administrative updates regarding the Pure Water Program Phase 1. This included authorizing time extensions for major construction contracts held by OHLA USA, Inc. (Morena Conveyance North), W.A. Rasic Construction, Inc. (North City Pipeline), and PCL Construction, Inc. (Metropolitan Biosolids Center Improvements). Additionally, the Council authorized budget increases for as-needed construction management services, adding $5.6 million to an agreement with Parsons-Black & Veatch Joint Venture and $4 million to an agreement with Jacobs-CH2M Hill Engineers, Inc., extending both contracts to 2028.