Decision on Klamath dam removal delayed

A contentious decision on whether four dams should be removed from the Klamath River Basin in California and Oregon may be delayed indefinitely pending Congressional guidance on how to balance the nation's policies governing hydroelectricity, fisheries, and dam removals.

Utility PacifiCorp owns four dams on the Klamath River and its tributaries whose license expired in 2006 and which are now targeted for removal.  After a lengthy and still-incomplete relicensing process and challenges by environmentalists, in 2010 PacifiCorp agreed to settle the dispute by seeking to remove the dams.  This settlement was documented in two key contracts, the Klamath Hydroelectric Settlement Agreement and the Klamath Basin Restoration Agreement.

These documents set March 31, 2012 as the deadline by which the Secretary of Interior must issue a so-called "Secretarial Determination" as to whether to go ahead with dam removal.  Unless the Secretarial Determination calls for the removal of the dams, it would be expected to require PacifiCorp to continue its application for a new hydropower license for the dams.

However, in the Klamath Basin case, the Secretary cannot issue a Secretarial Determination calling for dam removal unless Congress first passes legislation authorizing the determination.  Congress does not appear likely to take action on the issue in the near term, prompting Secretary of the Interior Ken Salazar to issue a press release last month announcing his decision to defer issuance of a secretarial determination.  In that release, Secretary Salazar stated, "Because Congress has not enacted legislation necessary to authorize a Secretarial Determination under the terms of the KHSA, there will not be a decision by March 31, 2012 on potential removal of the dams."

Now that a Secretarial Determination is no longer expected by March 31, stakeholders expect the final studies and environmental analysis will be released this spring.  Will Congress ultimately act on the Klamath River dam removal proposals?

Klamath basin dam removal

The US Department of the Interior recently released a draft report analyzing the economic and environmental impacts of removing four dams in the Klamath River Basin.  The report frames a public debate over water rights, natural resource management, and dam removal.

Long home to prodigious salmon runs and a vibrant ecosystem, several of the rivers in the Klamath system were dammed in the 1900s.  Today, four of these dams - J.C. Boyle, Copco 1, Copco 2, and Iron Gate - are owned by utility PacifiCorp. Over time, fish numbers in the Klamath River declined precipitously; according to the report, numbers of many species like salmon are reduced over 90% from historical levels.  In 2006, after a 50-year term, the FERC license for the four dams expired.

Activism by environmental groups and others frustrated PacifiCorp's plans to relicense the dams, and ultimately led stakeholders to sign two key agreements governing the basin: the Klamath Hydroelectric Settlement Agreement (KHSA) and the Klamath Basin Restoration Agreement in 2010.  Under the terms of those agreements, the four named dams would be removed.

The Draft Klamath Dam Removal Overview Report for the Secretary of the Interior (333 page PDF) bills itself as an assessment of scientific and technical information about the proposal.   The report found that dam removal would cost between $238 million and $493 million, with $292 million as the most likely cost.  Notably, these estimates are well below the amount previously projected for dam removal.  Dam removal would release sediment that could kill salmon in the short term, but the agency found that dam removal would create more habitat and could increase adult chinook salmon production by about 83 percent.

If the dams are to be removed, Congress will have to authorize their removal.  Together, the dams can produce up to 163 megawatts of power, and produce about 716,800 megawatt-hours per year.  While this is relatively small compared to national demand for electricity, existing hydroelectric generation is relatively low-cost compared to alternative sources of power.  Existing hydro also is generally viewed as emissions-free and relatively benign from an environmental perspective, especially compared to fossil fuel resources like coal and oil.  Nevertheless, the draft report suggests that the benefits of removal will exceed retaining the dams in place by a factor of between 9 and 48.

Will this be enough to justify their removal?

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.

January 28, 2011 - Utah power prices

Earlier this month, I noted that low power prices in Utah are attracting development and jobs to that state.  For example, the National Security Agency chose Utah to site a new 1 million square foot data center that may consume up to 65 megawatts of power - electricity that is generally cheaper in Utah than in many other states.  (The EIA reports that the September 2010 average all-sector electricity price in Utah was just 7.42 cents per kWh, significantly below the U.S. average of 10.24 cents per kWh for that time period.)

Now, PacifiCorp, operating as Rocky Mountain Power in Utah, has requested permission from the Public Service Commission of Utah to increase prices by an overall average of 13.7 percent. Rocky Mountain Power describes this price request as "necessary to serve our Utah customers’ growing electricity needs and to comply with environmental requirements".  In a 4-page PDF, Rocky Mountain Power points to increasing demand in Utah, and forecasts continued increases in demand based on forecasts of economic growth.  (As I noted last year, energy consumption has traditionally been viewed as directly correlated to GDP.)   Rocky Mountain Power states that building new facilities (generation and transmission) is more expensive than older facilities: "Our newest power plants are primarily natural gas and wind projects. While among the lowest cost options today, either one is about twice as expensive as the generating plants built in the 1970s and early 1980s."  Finally, Rocky Mountain Power points out, "Compared with our largest industrial customers, the company’s returns are modest and in line with other electricity providers."

The Public Service Commission of Utah will now consider Rocky Mountain Power's request.