This is exactly right. As an engineer myself my first instinct is often to look at technological solutions for issues like this, but if you just focus on increasing water supply without working on controlling the demand side of the equation you’ll just have the issue of induced demand, with more farmers growing water-intensive crops like almonds and alfalfa, and more ill-advised developments like the freakin’ lagoon that that Disney-branded housing development is putting in the center of their new project in Rancho Mirage.
Just as adding ever-more lanes to freeways cannot solve traffic problems on its own, engineering new water supplies won’t get us out of this mess if we don’t look at the other side of the equation.