In Spanish, Agua Hedionda literally means "stinking water". This was an accurate description of the stagnant lagoon before the Encina Power Station was commissioned in 1952. For over 50 years, the operators of the power plant have regularly maintained the lagoon and dredged an opening to the ocean to sustain a source of seawater to cool the power plant's generators. As a result, today the 388-acre Agua Hedionda Lagoon is a man-made, shallow coastal embayment teeming with marine life and an array of recreational and educational activities, and environmental research. The lagoon supports a thriving marine ecosystem and is home to the Hubbs-SeaWorld fish hatchery, the Carlsbad Aquafarm, YMCA Camp and the Lagoon Foundation's Discovery Center. The seawater cooled power plant is expected to be decommissioned in the coming years, leaving the lagoon without an entity responsible for its long-term maintenance. Locating the new seawater desalination plant next to the Encina Power Station solves this problem. The operators of the desalination plant will assume responsibility as the Agua Hedionda Lagoon's steward, providing long term maintenance and dredging, once the power plant is decommissioned.

Once built, the desalination plant will ensure the continued stewardship of the Agua Hedionda Lagoon and the surrounding watershed, and will guarantee for many years to come that the citizens of Carlsbad will be able to enjoy the benefits of this clean lagoon and its surrounding beaches.