Dam issue jams Klamath settlement
Power company process independent of stakeholders' agreement

Mateusz Perkowski, Capital Press 5/30/08

The fate of a settlement agreement between irrigators and tribes in the Klamath basin is up in the air as the prospect of dam removal, seen as key to the deal, remains foggy.

Five months after irrigators and tribes struck an agreement that would end legal disputes over water rights between the groups, the deal hasn't moved forward, largely because four hydroelectric dams along the Klamath river appear likely to remain intact for the foreseeable future.

PacifiCorp, the electric utility that owns the dams, isn't willing to remove the dams unless the federal government absolves the company's rate-payers of liability if anything goes wrong and reimburses them for higher rates.

"They need to cover our customers' risks and costs," said Art Sasse, spokesman for the company.

Sasse said the perception that PacifiCorp is holding up the settlement is untrue, since the utility's dam relicensing process with the Federal Energy Regulatory Commission is independent of the agreement hammered out by tribes, irrigators, federal agencies and conservation groups.

"That's not our deal," he said.

PacifiCorp will abide by the relicensing requirements, which may or may not involve dam removal, he said. Typically, the relicensing process lasts about 10 to 15 years, and the company applied for a new license for the Klamath Hydroelectric Project in 2004, Sasse said.

"We're talking years down the road" before a final decision is made, he said.

Of the last six hydroelectric projects that PacifiCorp had applied to relicense, half were decommissioned, Sasse said. Fish ladders were installed at the remaining projects, Sasse said.

No matter how persuasive settlement stakeholders are, dam removal will ultimately hinge on the impact to PacifiCorp's bottom line, said Greg Addington, executive director of the Klamath Water Users Association.

"It's going to have to be a business decision," he said.

The settlement stakeholders will continue pressing for dam removal, but even if the dams remain in place, Addington said, elements of the agreement could remain viable.

Before the settlement, irrigators, tribes and conservationists were usually at each others' throats in court, he said. Their newly forged coalition is unlikely to break up, regardless of the dams' fate, Addington said.

"If this thing goes away, we're not just going to stop talking to each other," he said.

Even from the financial perspective, though, PacifiCorp may come around to the settlement stakeholders' point of view, said Regina Chichizola, spokeswoman for the Klamath Riverkeeper.

The environmental group has worked closely with several Klamath-area tribes to advocate for dam removal.

"It seems like the economic arguments are very much on the side of dam removal," she said, pointing to a 2006 California Energy Commission study that found removal would be $80 million to $200 million cheaper than building fish ladders.

The delay in the settlement's implementation, however, may have negative repercussions even if the dams are decommissioned.

Since early 2007, the number of similar water rights' settlements between irrigators and tribes has grown from two to 13, said Dan Keppen, executive director of the Family Farm Alliance.

Most of these settlements also ask the government to fund restoration programs, he said. That means the $985 million Klamath settlement would need to stand in a long queue for money, Keppen said.

"They're going to be competing with other settlements," he said. "Settlements are starting to pop up all over the West. ... More and more, it's becoming accepted that this is how (water) disputes are settled."

Apart from these challenges, the settlement has also drawn the ire of Siskiyou County, Calif., which is opposed to dam removal.

That eventuality would be especially distressing if PacifiCorp doesn't have to bear responsibility for negative effects, said Marcia Armstrong, a district supervisor with the county.

"You could have massive destruction downstream," she said.

The county is worried that carcinogens in the 20 million metric tons of sediment behind the four dams would threaten fish, wildlife and people who use the Klamath River, she said.

"It's like having a poison river running through your community," she said.

Created by log transport on the river, the dioxins in the sediment are "bioaccumulative," meaning they travel up the food chain, Armstrong said. The effect of dam removal on sediment buildup simply isn't well understood, she said.

"This would be the largest dam removal project in the U.S., and the studies haven't been done," said Armstrong. "Not all would go downstream, but there hasn't been a study on how it would move downstream. We think it's premature."

The settlement agreement has also met with disapproval from the Hoopa Valley tribe, which believes the deal makes irrigation a higher priority than fish protection.

The Klamath Off-Project Water Users also oppose the terms of the settlement, said Edward Bartell, a grower and president of the group.

"We see it as directly targeting off-project interests," he said.

While the deal contains assurances for irrigators within the Klamath Project, it doesn't offer similar protection for off-project water use, Bartell said. Also, the agreement doesn't allocate enough money for electricity generation to keep power rates low, he said.

Contrary to its initial purpose, the settlement did not bring off-project interests into consideration, Bartell said. "They decided to divide up their chips rather than abide by their agreements with us."

Staff writer Mateusz Perkowski is based in Salem, Ore. E-mail: mperkowski@capitalpress.com.