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As Relicensing Looms, Aging Dams Face a Reckoning

Felicity Barringer
Mar 5 2019

Green power source or fish killer? As older dams around the West come up for relicensing, their owners know that they’ll have to spend heavily to fix problems, while new energy sources are getting cheaper.

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Seen here around 1968, the Cape Horn Dam on the Eel River was built in 1900, creating Lake Van Arsdale and sending water through a tunnel to a hydroelectric turbine in the Russian River watershed. Library of Congress
 

Update, May 14, 2020

The Potter Valley project in northern California, which was abandoned last year by its owner, Pacific Gas & Electric, is on its way to adoption by a partnership whose plans include removal of Scott Dam, built in 1920 on the Eel River, according to a report just submitted to the Federal Energy Regulatory Commission.
 
This group is made up of local government, water and energy agencies, a Native American group, and an environmental group. Their report described a plan to operate the project, working to ensure electricity and irrigation needs are still met while removing the dam. They plan to form a new authority to manage the project.
 
Environmental groups and tribes seeking to restore salmon runs on the Eel River had long sought the removal of Scott Dam. Rep. Jared Huffman, a Democrat from San Rafael, who helped bring the coalition together, told the Redwood Times-Standard the proposal is “a very significant acknowledgement by the coalition partners that all the technical analysis and scrutiny we’ve applied to this project points to removing Scott Dam as the only way to achieve the fish goal.”

Update, May 16, 2019

The Potter Valley project won’t be an orphan much longer. Two months ago, the Pacific Gas & Electric Company abandoned the two-dam, one-tunnel facility, which generates 9.2 megawatts of electricity and transfers water from the Eel River to the Russian River. PG&E told the Federal Energy Regulatory Commission it would not renew its hydropower license. But agricultural interests in Sonoma and Mendocino Counties, which benefit from water transferred from the Eel River Water to the Russian River, feared losing that water. Now the Sonoma County Water Agency, the Mendocino Inland Water and Power Commission, and California Trout, Inc. are working together on a two-basin proposal. They hope to forge a planning agreement to “secure the region’s water supply and protect endangered salmon species in the Eel River and upper Russian River,” said a press release from the office of North Bay congressman Jared Huffman. It quotes Curtis Knight, executive director of California Trout, saying, “We are committed to finding a solution … that meets the needs of fish, water and people.” The agencies expect to form a new entity to take over the project.

By Felicity Barringer

More than a century ago, the people of Mendocino County in California needed electricity to fit into the industrialized world. So engineers generated power by building two dams and reconfiguring two rivers. For decades thereafter, people fashioned steadily improving lives around the new landscapes. At the same time, beset by environmental insults, the annual runs of salmonids in the Eel River withered.

Inevitably, priorities changed. As building the dams and creating the 9.2-megawatt Potter Valley project solved the need for electricity, a new need developed: irrigation. Tens of thousands of acre-feet of Eel River water were diverted to supply the power station at the headwaters of the Russian River’s East Branch. Then it flowed on, supplying cities and farmers and nurturing Mendocino and Sonoma County’s expanding agriculture – once pears and hops, now dominated by wine grapes.

The current need: repair the harm caused by the dams. That will cost so many tens of millions of dollars that the project’s owner, Pacific Gas & Electric – already losing money on it – is cutting its losses. It will not seek a new federal license.

This decision mimics PG&E’s recent moves away from other small hydroelectric projects, like the 12-megawatt Narrows project on the Yuba River in Nevada County, which PG&E sold last year to a local water agency. It also echoes decisions by the northwestern utility PacifiCorp, which, at a cost of $37 million, breached its 14.7 megawatt Condit Dam on the White Salmon River in Washington.

The Potter Valley Project: More Than Just a Dam

Built starting in 1905 by the Eel River Power and Irrigation Company, the Potter Valley Project grew over time to comprise two dams on the Eel River and two reservoirs: Lake Van Arsdale and Lake Pillsbury. The project eventually served two purposes: to generate power from Eel River water diverted to a powerhouse in Potter Valley, and to bring irrigation water to the Russian River watershed. This water served expanding agricultural areas in Mendocino and Sonoma Counties, including many new vineyards. Since the Russian River watershed is susceptible to flooding, the Army Corps of Engineers completed the Coyote Valley dam in 1958 for flood control. It created Lake Mendocino and provided a new source of both irrigation water and opportunities for recreation.

Timeline of the Potter Valley Project

Tap to see animated timeline of the Potter Valley Project

Sources: Potter Valley Project; Friends of the Eel River; Natural Earth Data; ESRI Earth Imagery; NASA Elevation Data

Geoff McGhee/Bill Lane Center for the American West

Choices Ahead for Owners of Small Hydroelectric Projects Across the West

Depending on how it finally turns out, the narrative of the Potter Valley project could be a cautionary tale for other dam owners whose stakeholders are at odds. Or it could be a roadmap to reconciling competing interests.

Dam by dam, owners of smaller hydroelectric projects around the West look at them with a cold eye as relicensing looms. Created with optimism a century ago, dams are now seen as fish-killers and river-distorters. New energy sources are getting cheaper. After decades of operation, owners approach relicensing knowing that, if they are to continue generating a single watt of electricity, they must fix the problems.

Tens of millions of dollars are often at stake. The Federal Energy Regulatory Commission licenses hydroelectric projects for up to 50 years, but sometimes just one year at a time to ensure problems are resolved. Limited revenue from electricity may not justify expensive remediation. Before it was sold off, a financial analysis of the Narrows project showed costs would have outweighed profits by more than $12 million over the first five years.

Depending on how it finally turns out, the narrative of the Potter Valley project could be a cautionary tale for other dam owners whose stakeholders are at odds. Or it could be a roadmap to reconciling competing interests. Whatever the lesson, the project is part of a larger transformation in how people understand debts owed to the environment. And how they are repaid. “[The Potter Valley project] is a subset of a much larger body of problems,” said Scott Greacen, conservation director at Friends of the Eel River, a conservation organization that is seeking to restore natural streamflows. Over the decades, “we took a lot of capital out of natural systems. Now the bills are coming due.”

Fighting climate change is another urgent need. One way is by creating carbon-free electricity – what dams do. The historian Heather Lee Miller, a staffer at Historical Research Associates in Washington, believes that if all governments classify small hydroelectric projects’ energy as renewable, subsidies could change the financial picture.

“Certainly some of the dams are in terrible places,” she said. Others, like PacifiCorp’s 1.1-megawatt project at Wallowa Falls in Oregon, are being relicensed. “There’s a backlog of dams that aren’t in the right spot,” she said, but added that, as the climate changes, it would be wrong to think small hydro-electric projects have no future.

What is the difference between projects like Wallowa Falls being relicensed and those, like Potter Valley, being abandoned by big electric companies? Economics are central. Relicensing the Potter Valley project promised to be daunting even before PG&E, facing hundreds of millions of dollars of wildfire liabilities, declared bankruptcy. “It now looks like PG&E’s overall incentive structure has shifted,” Greacen said. “They have given up.”

Western Dams Facing Relicensing Through 2025

The Federal Energy Regulatory Commission is charged with certifying hydroelectric projects for operation. It can license them for up to 50 years, but sometimes as little as one year at a time to ensure problems are resolved. Owners must file notice five years in advance of expiration that they intend to reapply, and must file an application at least two years before the license expires.


Sources: Federal Energy Regulatory Commission


Sources: Federal Energy Regulatory Commission

Bill Lane Center for the American West

Who Decides the Future? A Stakeholder Group Struggles to Find Compromise

The federal government determines the terms of PG&E’s exit. FERC will solicit interest from others to run it. If no one comes forward, it will order PG&E to develop a decommissioning plan that may or may not include removing facilities.

PG&E’s finances are private, but the economic analysis done for the Narrows project on the Yuba River offers guidance.

Jeff Bodington of San Francisco, the financial analyst who did it, said, “these projects made sense at the time they were built and perhaps for decades thereafter. Many still make sense.” But “some may make sense day in and day out, but when a license expires, relicensing can be very costly. A small project cannot absorb big relicensing costs. For each relicensing, he said, “these questions get asked. Are there fish impacts? Recreational impacts? Other impacts?”

The Potter Valley project had many impacts. The region’s congressman, Jared Huffman, created a working group of all stakeholders — water agencies, local and county governments, tribes, federal and state wildlife specialists and environmental groups – to hash out what the project should become and what happens to the dams.

Asked if the Potter Valley project is an electrical project or a water distribution project, Congressman Jared Huffman said simply. “Yes.” He added, “The question is, whether it can be both of those things and a fish recovery project.”

Dams a Mortal Threat to Fish Runs, Scientific and Regulatory Consensus Holds

Coho salmon, Chinook salmon and steelhead are on a trajectory to extinction in the Eel River basin.

In the past two decades, the federal government agreed with scientists that salmon and steelhead runs in the Eel River are threatened. A 2010 report from the Center for Watershed Sciences at the University of California, Davis, concluded, “coho salmon, Chinook salmon and steelhead are on a trajectory to extinction in the Eel River basin.”

The culprits listed in that report include early 20th-century commercial fishing and mechanized logging whose clear-cuts on the hillsides caused erosion that silted up the river. Floods in 1955 and 1964 added silt and changed the river’s course. All that hampered fish passage, but not as much as Scott Dam, built in 1922. It blocks dozens of miles of spawning areas. The report said, “the loss of salmonid habitat upstream of Scott Dam means there are fewer areas to serve as refuges for salmonid and steelhead… during environmentally unfriendly periods such as extended droughts.”

Eel River Diversions Were Slashed in 2006… But Then Russian River Fish Suffered

Eel and Russian River Map
The Potter Valley Project takes water from the Eel River, which flows north, and pumps it into the Russian River, which flows south towards wine country. Bill Lane Center for the American West

In 2004, the Federal Energy Regulatory commission ordered the diversions cut back from what was then 160,000 acre-feet annually. Now they average 72,000 acre-feet. These inter-basin diversions help fish in the Russian River. The Eel River water flows through a mile-long tunnel to generate electricity at a powerhouse on the banks of the East Fork of the Russian River. The water not used by the Potter Valley Irrigation District and other local diverters ends up behind the Coyote Valley dam in Lake Mendocino and is released periodically into the Russian River.

The state Water Resources Control Board requires the Sonoma County Water Agency to keep minimum stream flows on the Russian River to maintain fish spawning and migration and support recreation. The Eel River water transfers help them do that, according to Don Seymour, a principal engineer at the Sonoma County Water Agency.

The agency has had difficulty meeting its minimum instream flow requirements while not depleting Lake Mendocino. It won’t be easy to serve its urban, industrial and agricultural customers and help its endangered fish recover if there is less water in Lake Mendocino.

Help for Spawning Fish Could Cost Tens of Millions of Dollars – or Hundreds

Joshua Fuller, the National Marine Fisheries Service’s expert on salmonid runs in the Eel River, agrees that the Russian River fish do benefit from the Eel River water — but says access to the upper Eel River is crucial for reviving its salmonids.

Different strategies give fish access to spawning grounds. These include dam removal, a fish ladder, or hauling fish in trucks. Fuller heads one of two working groups in Congressman Huffman’s ad hoc committee weighing Potter Valley’s future. His group on fish passage is about to pick the two best of available solutions.

Good fish ladders are expensive. In August, the Lost Coast Outpost reported that a 2017 engineering report prepared for PG&E “found that constructing a functional fish ladder at Scott Dam would likely cost between $55 million and $93 million.” It would be “challenging to build, complicated to operate, very costly, and would have uncertain effectiveness.” Removing Scott Dam would be at least as expensive. Increasing the size of Coyote Valley dam, which holds back the Russian River, could cost $300 million.

Where could the money come from? As Congressman Huffman said, “If you look around at any stakeholder in either basin, none of them has the capacity to solve this problem and pay for it on their own. The only way to do this is to come together and unlock state and federal money.” His stakeholders group could sign a legal agreement giving the project a way forward without litigation.

PG&E’s January 25 announcement that it wanted out of Potter Valley complicates the plans being developed in the ad hoc committee. Huffman said that the glue binding potentially antagonistic stakeholders “is the fact that everybody’s at risk. There are really lousy solutions” possible “for everyone, no matter what their perspective.”

As Hydropower Profits Dwindle, Paying off Environmental Debt Gets Harder. But Renewable Energy Mandate May Help

Aerial image of Scott Dam
Scott Dam on the Eel River, above, completely blocks salmonid migration. A fish ladder could cost $55 to $93 million, and might not work. Rob Badger

The details of the project’s role in two different water basins are unique, but it has one thing in common with others: its owners are disinclined to pay environmental debts. “There’s the broader context of what’s going on in electricity markets,” said an energy consultant who would not speak for attribution. “With historically low wholesale energy prices, utilities, not surprisingly, will operate their lowest-cost units. Particularly if you have old infrastructure.”

But a new reality is emerging. Climate change puts a different perspective on the future of some small projects: states like California mandate a largely, or entirely carbon-free electric portfolio 25 years hence. “Resources that are 100 percent renewable are the new black,” he said. “That creates an opportunity for resources that have been ugly ducklings.” Todd Olson, a spokesman for PacifiCorp, which relicensed the Wallowa dam in 2017, said, “We went through the whole analysis many times over. We ultimately kept it because it is renewable, and there are other community values.”

Residents of Lake, Mendocino, and Sonoma Counties feel the Potter Valley project is crucial to them. “We’re talking about legacies now,” said Fuller of the fisheries service. “This project has been going on so long, cultures, families and generations are built around it. Say the project goes away: life is going to change for people.”

Data doesn’t yet show a clear trend of small hydropower projects’ owners walking away from them, although Mr. Bodington did say, “The trend is more getting taken down than put up.” Dozens of licenses are due for renewal in the next decade. Studies begin years before a license expires; the Potter Valley project’s license expires in 2022.

Whether or not Scott Dam is removed, and whether or not that decision is part of a wider trend, Mr. Huffman does see attitudes on dam removal changing. “Each time there’s a successful dam removal, it is demystified a little bit,” he said. “You should naturally see things get little bit easier, where dam removal makes sense going forward. But it’s always going to be case by case.”

 

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Edited by Geoff McGhee.

 

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Anonymous Yuba County, CA

Responding to As Relicensing Looms, Aging Dams Face a Reckoning

Interesting article. The FERC relicensing process is a lot more complicated and not exactly as described here. The idea that every project is unique is true. In our area of California, a lot of the dams and hundreds of miles of conveyances were built for hydraulic mining water supply or to contain the resulting debris from that process. These water systems were later adapted into agricultural supply and hydroelectric generation. When hydro projects now come up for relicensing, they have to deal with these historic issues as well as complying with many environmental and cultural laws that didn't exist when they were constructed. There is little relationship between the generation capacity and the cost of relicensing. However, the electric generation hydro provides is very flexible in terms of turning it on and off, which makes it very useful in combination with wind and solar, which can be intermittent. This helps in matching generation to varying power demand (the duck curve).

3/21/2019, 2:01pm

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A Rabbit Plague Is Hitting the Southwest, bringing a mortality rate of up to 70 percent to populations of jackrabbits, hares and related species, including the rare pika. Rabbit hemorrhagic disease causes fevers, bloody noses and lethargy in rabbits, hares and other similar species, who often die of internal bleeding or liver failure. It came from China and Europe and infected domestic rabbits two years ago, but is now spreading in the wild. “The virus is in a pretty vast area, and we don’t have any tools to use to mitigate the spread or stop it once it’s out in free-ranging populations,” said a U.S. Geological Survey expert. The Guardian

Effort to Block the California-Quebec Climate Deal Fails, as a federal court finds the pact on greenhouse-gas emissions doesn’t usurp federal foreign-policy prerogatives. The cap-and-trade program at the heart of California’s fight against climate change could have been weakened if the Trump administration challenge had been upheld. Bloomberg

In Utah, a Debate Simmers Over Estonian Radioactive Waste, which could be reprocessed at a mill next door to the Ute Mountain Ute reservation, the only operational uranium mill in the United States. State officials must approve an importation license. Tribal officials fear this waste transfer could become the first of many to the White Mesa Mill in San Juan County, in southeastern Utah. The tribe says the mill was designed for a different function and is 20 years past its original planned lifespan. Reuters

Yellowstone’s Grizzly Bears Won’t Lose Federal Protections, thanks to ruling in a Montana state court that has been upheld by federal appeals judges. A 2017 federal decision stripping the bears of threatened status under the endangered species act could have paved the way for state-planned hunts Bozeman Daily Chronicle

Birds, Like Buildings, Can Have Confederate Names. One is the McCown’s longspur, a sparrow-like bird that summers in the Great Plains and winters in the southwest. John Porter McCown, its namesake, helped forcibly relocate Native Americans in the 1840s and served as a Confederate general during the Civil War. “Naming and language have power. The way that you use language tells people whether they belong or not,” said Earyn McGee, a University of Arizona doctoral candidate and organizer an online campaign to increase visibility of Black birders. The American Ornithological Society had balked at a name change; it is now rethinking that decision. Undark

Why Is the West Running Out of Water? A crisp and succinct video history of the series of poor decisions that have left the region looking at a parched future. Some 40 million people now depend on the Colorado River, which will be increasingly unable to provide water to those that need it. Cheddar

Articles Worth Reading: July 7, 2020

Four Years After the Standing Rock Sioux Tribe Sued to Block the Dakota Access Pipeline, and about four months after a federal district judge said the environmental assessment used to grant a permit was insufficient, the $3.8 billion pipeline is ordered to shut until a new environmental impact statement is finished. The pipeline had carried up to 570,000 barrels of Bakken Shale oil out of North Dakota daily before the pandemic. The U.S. District Court Judge James Boasberg, who revoked the Army Corps of Engineers’ permit allowing the pipeline to operate, is known for writing opinions featuring good humor and cultural savvy. Bismarck Tribune E&E Daily

Energy Department Approves First West Coast Liquefied Natural Gas Terminal at Coos Bay, Oregon. The Jordan Cove terminal, strongly supported by natural gas companies in Colorado and Utah that seek easy access to Asian markets, was first boosted in March when the Federal Energy Regulatory Commission authorized operations. DoE approval means the project can export as much as 1.06 billion cubic feet of LNG daily. A lawsuit seeking reversal of the FERC approval is pending. E&E DAILY

Images of Walls of Dust Headed for Phoenix Have Become a Summer Staple for a reason: researchers determined that these haboobs doubled in number between the 1990s and 2000s. Less often pictured are the likely impact: hospitals report a 4.8 percent increase in intensive care admissions on dust-storm days; the increased in respiratory admissions tops nine percent the next day. Bloomberg

Rio Grande Flow Levels Sink to Historic Lows in Albuquerque as rainless days force the release of water held in reserve. That supply may run out by mid-July, forcing difficult decisions over how existing groundwater supplies will be apportioned. John Fleck/Inkstain

PG&E Exits Bankruptcy With a New Board and a Lot of Work to Do as Wildfire Danger Proliferates PG&E filed for bankruptcy in January 2019, facing liabilities from multiple catastrophic wildfires that killed more than 100 people in northern California after they were sparked by its power lines. The company’s $25.5 billion payout to victims, insurance companies, and local governments. Leaving bankruptcy now means PG&E can take part in a $21 billion wildfire insurance fund. Utility Dive

The Border Wall Will Not Cross the Cocopah Reservation in the Colorado River Delta. The original plan had included this seven-mile stretch east of the Colorado, but the money to pay for it was cancelled by Trump Administration lawyers in May after the Sierra Club and other groups sued to block that section of the wall. ASU/Cronkite News

The White-Throated Sparrows’ New Song Tops the Charts From British Columbia to Manitoba, avian scientists find. It’s taken about two decades for the new song, ending in a doublet of repeated tones, to be picked up other sparrows further East. Now the conversion from the old song -- ending in a triplet -- has become evident across most of Canada, starting in the far West. The scientist who discovered the change reports “White-throated sparrows have this classic song that's supposed to sound like it goes, ‘Oh, my sweet Canada, Canada, Canada….And our birds sound like they're going, ‘Oh, my sweet Cana– Cana– Cana– Canada.’” National Geographic

Graphics & the West

Where California Grows Its Food

See the most detailed survey ever done of crops and land use in California. It covers nine million acres of land devoted to grapes, alfalfa, cotton, plums, you name it – food for people and animals all over the world. View map »

California's Changing Energy Mix

A look at the energy sources California utilities have used gives us insights into the state’s progress in decarbonizing its electricity supply. In 2015, 35% of total electricity generation (in-state generation plus imported electricity) came from zero-greenhouse-gas sources, which include solar, wind, hydropower, and nuclear. View Graphic »

U.S. Conservation Easements

Conservation easements of various kinds cover more than 22 million acres of land in the United States, according to the National Conservation Easement Database, a public-private partnership. Take a look at our interactive map of nearly every conservation easement, with details on over 130,000 sites. View map »

 

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