SFPUC forecasts $203m cost increase for Moccasin Penstock replacement

SFPUC forecasts $203m cost increase for Moccasin Penstock replacementA recent property acquisition has removed long-standing easement restrictions, allowing the utility to evaluate full pipeline or tunnel replacement alternatives within the existing right-of-way.

The $203 million forecast increase has been incorporated into the utility's FY 2027-2036 10-year Capital Improvement Program.

The revised budget accounts for a full replacement utilizing either a pipeline, a tunnel, or a combination of both.

SFPUC will conduct geotechnical investigations over the next year to determine constructability and final costs.

The utility is heavily considering a progressive design-build contract for the project to engage a contractor early in the design phase.

The San Francisco Public Utilities Commission (SFPUC) is projecting a $203 million cost increase for its Moccasin Penstock Rehabilitation Project following a strategic land acquisition that has expanded the project's scope. Speaking at a March 10, 2026, commission meeting, Director of Water Capital Programs Katie Miller announced that the latest cost estimating accounts for a full replacement project, which will consist of either a pipeline, a tunnel, or a combination of both. The $203 million variance has already been factored into the SFPUC's fiscal year 2027–2036 10-year Capital Improvement Program, which was approved in February. The shift in strategy was enabled by the recent acquisition of a privately held property along the existing penstock alignment. According to Miller, the purchase removes former easement restrictions, allowing the utility to examine new tunnel and pipeline alternatives within the current right-of-way. Utility officials indicated the expanded footprint may ultimately lead to long-term cost savings and operational efficiencies. To advance the new alternatives, the SFPUC plans to perform geotechnical investigations along the right-of-way over the next year to better understand constructability and refine project costs. The utility is also evaluating alternative delivery models for the upcoming work. In response to commissioner questions about procurement, Miller noted that the SFPUC is "seriously evaluating" a progressive design-build approach for the Moccasin Penstock project. Engaging a contractor early in the process is expected to help the utility better understand true costs and constructability challenges before finalizing the design. The Moccasin Penstock update was presented as part of the broader Hetch Hetchy Capital Improvement Program quarterly report. The program currently has nine construction contracts underway with a total construction value of $275 million.