Many hopes are riding on the new $1-billion, 54-million-gallon-a-day seawater desalination plant and pipeline in Carlsbad, Calif. If successful, the project, made possible through one of the first public-private partnerships of its kind in the U.S., could serve as a model for other projects around the country.

If the project falters, however, the growing momentum for similar U.S. seawater desalination projects could face a reversal, industry observers say.