[6] First Take On Columbia River Treaty Options Released

If the Columbia River Treaty remains in place after 2024, the Canadian share of downstream benefits will continue to decline at a slower rate than anticipated, putting added cost pressures on BPA and the Mid-Cs to deliver the Canadian share.

On the other hand, if the treaty is terminated, the region will have to obtain an estimated 225 aMW in additional resources to make up for reduced water availability.

Those are two of the conclusions reached in the Columbia River Treaty 2014/2024 Review Phase I Report, which BPA, the Army Corps and BC Hydro published July 30.

The report is aimed at providing regional interests preliminary data with which to consider what positions to take as the 10-year treaty termination notice deadline approaches on Sept. 16, 2014. It does not deal with non-power issues such as fish operations, irrigation or water supply.

Under the 1961 treaty, the U.S. got permission to back Libby Dam's reservoir 42 miles into Canada, which was paid for by half the estimated value of flood damage prevented. Canada built 15.5 MAF of storage, and was allotted half the downstream benefits (the Canadian Entitlement, or CE).

The energy component of the entitlement is currently about 567 aMW, and BPA is responsible for returning 72.5 percent of its half to Canada, and the Mid-C PUDs supply the rest.

Phase I, developed under a confidentiality agreement with the Canadian side, is a modeling analysis that looks at three options: allowing the treaty and CE deliveries to continue; terminating the treaty and the CE; and continuing the treaty with pre-2024 conditions.

Under the first two, the current flood-control operating plan (FCOP) reverts to a "Called Upon" flood control operation under which the U.S. would still have access to Canadian flood control storage, but would have to compensate Canada for operating and lost opportunity costs.

Under the third, a deal to retain the FCOP would be negotiated and CE deliveries would continue. Phase I looks at 13 scenarios with varying time horizons, flood-control objectives and water-supply simulations.

The report points out that "there are different views" between the U.S. and Canadian side about how to interpret provisions of the "Called Upon" operating regime. Although the treaty mentions it, details such as what level of flooding would trigger BPA's right to invoke "Call Upon" operations would have to be negotiated, said Nancy Stephan, BPA's project manager for the report.

For example, under the existing FCOP, flooding begins when flows at The Dalles hit 450 kcfs--a level that is currently under review by the Army Corps--while "major damages" occur at about 600 kcfs. The lower the figure, the greater is the frequency of "Called Upon" operations. The report said the amount of "Called Upon" storage that will be needed in the "treaty continues" and "treaty is terminated" studies ranged substantially between 1 MAF and 11 MAF, respectively.

According to the report, when the treaty was signed, it was anticipated that the energy component of the CE would decline due to the impact of increases in the thermal displacement market, which in turn is affected by the region's load growth and resource mix. The calculation of the CE was based on these assumptions. However, load has not grown as much as anticipated and increasing proportions of conservation and wind in relation to thermal resources has stalled the decline in the CE.

BPA's Stephan also said the treaty, which was signed with power and flood control in mind, did not anticipate the significant derating in Federal Columbia River Power System capability due to fish operations. Deliveries to Canada "do not take that into account," she said.

"We give them half of what's calculated, but not what is actually generated," she said, which is less. The inequity on the U.S. side is self-imposed by fish and wildlife policies that do not apply in Canada, she acknowledged.

The document also concluded that if the treaty remains in place:

• The U.S. will see flood control and power benefits do apply to continuation of the existing Assured Operating Plan for Canadian storage;
• Canada will benefit from the CE and increased generation flexibility;
• The estimated size of CE will decrease from 470 aMW in 2024 to 290 aMW in 2040, where it will then stabilize;
• U.S. flood control benefits will include more certainty and more volume compared to the Called Upon regime;

But if the treaty terminates:

• Canada loses the CE;
• Reductions in outflows at Arrow and Duncan in August would cause Grand Coulee to draft and not refill in most years until early winter;
• Overall annual hydro generation in both countries would not change much, but the month-to-month shape of generation would differ dramatically;
• Most of the Called Upon flood control draft would come from Arrow, which Canada would be more likely to operate at higher elevations while optimizing generation with more constant discharges;
• There would be more uncertainty in daily, weekly and monthly flows as Canada operates for its own needs;
• There will be a reduction from four years to one year in the "critical period"--the time it takes for natural flows plus reservoir releases to provide enough water to generate the least amount of power needed to meet system load--which could be a concern during prolonged droughts.

Stephan said BPA now intends to begin a process of public engagement to share the results of the Phase I study and to seek input from a wide range of constituents.

She said now that most aspects of the confidentiality agreement between the Canadian and U.S. side have lapsed, BPA will be freer to discuss and share information and invite other groups to participate in the next phase of studies, which will look more closely at the Called Upon regime, climate change, system power studies and other elements.

Stephan said the report, which is about a year overdue, was delayed because the complexity of designing and implementing the Called Upon model, two mid-stream decisions to make changes to certain fundamental assumptions in the studies, and the vagaries of trying to coordinate three agencies on a neutral document covering sensitive matters they all would likely soon be negotiating. -Ben Tansey

The following links were mentioned in this story:

Columbia River Treaty 2014/2024 Review Phase I Report

Subscriptions and Feedback
Subscribe to the Fishletter notification e-mail list.
Send e-mail comments to the editor.

THE ARCHIVE :: Previous NW Fishletter issues and supporting documents.

NW Fishletter is produced by Energy NewsData.
Publisher: Cyrus Noë, Editor: Bill Rudolph
Phone: (206) 285-4848 Fax: (206) 281-8035