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 http://www.heraldandnews.com/articles/2006/01/31/viewpoints/editorials/views.txt

There's justification for low irrigation rates

 January 31, 2006

The case for low power rates for Klamath Reclamation Project farmers is wrapped up in history and a bargain that should continue.

Fifty years ago PacifiCorp's predecessor in the development of power from the Klamath River, Copco, made a deal that in return for the right to put dams on the Klamath River to generate power - and profits - Copco would extend low power costs to irrigators on the Klamath Reclamation Project.

The agreement made sense, and it still does. Now, though, the deal is being threatened because the Federal Energy Regulatory Commission has denied a request by the Bureau of Reclamation, which administers the Klamath Project, to continue the lower power rates after the 50-year agreement on the issue ends April 16. The Bureau had argued for an extension of the current rates because of the Project's help in regulating the water flow, making it more dependable, which benefits not just the power company, but the Basin's refuges.

Agriculture in the Klamath Basin helps maintain a steadier flow of water downriver than would otherwise exist.

Such rates also encouraged development in the Basin and, while irrigators were getting a break on their power rates, the people and businesses in the Basin's towns paid full fare. Just like other businesses, power companies have actively encouraged economic development, and low rates for irrigators are a form of that.

In addition, the government wanted to encourage development aimed at growing food and generating income.

PacifiCorp says it feels it's unfair to other ratepayers to continue the low rate. The license to operate the dams also is coming to an end of its 50-year run and PacifiCorp has filed for renewal. It's hard to see any less justification of offering lower rates now than there was 50 years ago, though that doesn't mean the rates should stay as low as they are.

Upward movement is probably inevitable, but the future contract should recognize - as do present rates - the role that agriculture plays in regulating Klamath River flows.

Irrigators on the Oregon side of the Oregon-California border have some protection from an immediate 10-fold or so increase in power rates through an Oregon law that phases in such large increases over seven years. Irrigators on the California side don't, but PacifiCorp says it's talking to the California Public Utility Commission about such an agreement on the California side.

We hope the company is forceful and persuasive in its effort.

In addition, the utility commissions in the two states should recognize the historical basis, and its grounding in fairness, for the deal.

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