February 28, 2011 - dam removal costs and values

Dam removal can bring environmental benefits, but comes with costs.  These costs can include not only the expense of physically breaching the dam and removing its remains, but also costs associated with sampling and remediating contaminated sediments trapped behind the dam.  Here's a quick look at two case studies, providing updates on stories I've noted before.

Last November, I looked at what's trapped behind dams on South Carolina's Twelve Mile Creek near Clemson.  Polychlorinated biphenyls (PCBs) and other chemical contaminants from electronics manufacturing operations have become trapped in sediments behind several dams slated for removal.  Removal of the dams is expected to allow cleaner sediments to flow down into Lake Hartwell where they are hoped to be able to cap the PCB-contaminated lake bottom.  Work on a sediment storage area is now ongoing along Twelve Mile Creek, funded through the $9 million settlement in the enforcement lawsuit against the manufacturer.

Just over a year ago, I noted that a settlement agreement would lead to the removal of four hydro-electric dams on the Klamath River in California and Oregon.  There, utility PacifiCorp has agreed to undertake the dam removal, which is projected to commence in 2020.  Overall, the Klamath Basin Restoration Agreement and Klamath Hydroelectric Settlement Agreement contemplate a dam removal cost of $450 million, with another $1 billion in environmental restoration activities.  How will dam removal be paid for?  At least part of the funds (albeit a relatively small share) will likely come from PacifiCorp's ratepayers.  A California administrative law judge has recommended that the California Public Utilities Commission approve a nine-year 2 percent rate increase to raise $13.8 million for dam removal.   Where the rest of the money will come from, as well as whether U.S. Secretary of the Interior Ken Salazar decides to support dam removal, remains to be seen.