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NW Fishletter #382 June 4, 2018

[3] FERC Awaits Detailed Plan For Klamath River Dam Removal

In the Klamath River basin, most eyes are on July, when PacifiCorp and the Klamath River Renewal Corporation (KRRC) plan to file what's known as the "Definite Plan" for removing four of eight dams now operated by PacifiCorp. That filing is expected to include an updated maximum and probable cost estimate, along with a plan for how KRRC will pay if removal and reclamation exceed the $450 million earmarked from PacifiCorp customer surcharges and a California bond. The Federal Energy Regulatory Commission (FERC) is also expecting responses to other questions that must be answered before it considers transferring the four lower Klamath River dams to KRRC for removal.

But anticipation of the Definite Plan for removal hasn't stopped new filings in the FERC case, which holds the fate of the J.C. Boyle, Copco No. 1, Copco No. 2 and Iron Gate dams in California and Oregon.

One of the motions was filed by PacifiCorps, in response to FERC's March 15 decision to separate four of the dams from its license. PacifiCorp and KRRC--a nonprofit corporation formed specifically to take out the dams and restore the land now inundated by reservoirs--had filed the application to amend the license and transfer four of the dams to KRRC in September 2016. FERC's decision agreed to create a new license for the four lower dams--effective immediately--but deferred its decision on whether to transfer them to KRRC.

In a motion filed April 16, PacifiCorp asked FERC to stay its decision to amend the license until it acts on the transfer request, or else for a "limited rehearing" to establish when the two licenses should become effective. FERC's order, PacifiCorp's motion states, "upsets the carefully crafted sequence of events" in the settlement agreement, and makes PacifiCorp immediately responsible for operating two separate licenses at a compliance cost that could exceed $3.1 million. PacifiCorp's motion states it does not dispute that the costs will be required, but it did not anticipate them until the license is transferred. Many of the requirements, it argues, would be unnecessary if FERC later decides not to grant the transfer.

On May 1, the California Natural Resources Agency and the California Department of Fish and Wildlife filed a letter with FERC supporting PacifiCorp's request to stay FERC's decision. "requiring PacifiCorp to fulfill them at this time, while the transfer application is still pending, would divert resources and attention from PacifiCorp and KRRC preparing responses to the Commission's inquiries regarding transfer and obtaining the approvals of necessary state and federal regulatory agencies for the contemplated removal of the Lower Klamath Project dams," their letter stated.

PacifiCorp initially tried to relicense all eight dams before its license expired in 2006, but found the lower four dams would operate at a loss if it spent the hundreds of millions of dollars it would cost to adhere to new FERC requirements. Those dams have a total capacity of 163 MW, and average 686,000 kWh annually.

After reaching a settlement with numerous parties in 2010 to remove the dams, Congress failed to act on it. A new settlement agreement was reached in 2016, and signed by California, Oregon, the U.S. State and Commerce departments, the Karuk and Yurok tribes, Humboldt County, Calif. and nine conservation and fishing groups, which included a plan to decommission the dams through FERC.

That plan includes a total of $450 million is committed from three sources: $184 million from surcharges to Oregon customers, $16 million from surcharges to California customers, and $250 million from a bond measure passed by the California state legislature in 2009.

Some of the parties not involved in the second settlement agreement are not satisfied.

On April 24, the Siskiyou County Water Users Association filed a motion to dismiss the transfer application, saying it would be unconstitutional for FERC to agree to the transfer, since only Congress can make that decision. Their argument relies on a provision known as the Compact Clause, saying, "No state shall, without the Consent of Congress enter into any Agreement or Compact with another State." They claim that the original settlement agreement required Congressional legislation, which was not obtained, and the amended settlement from 2016 "constitutes an agreement between California, Oregon and other parties, the implementation of which is barred by federal law."

On May 2, Siskiyou County, Calif. filed a motion for either a clarification or a declaration from FERC stating that it intends to prepare an EIS addressing the environmental impacts of decommissioning the dams before transferring the license for the lower dams to KRRC. The motion says FERC acknowledged that it "has not previously considered an application to transfer a license to a new entity whose sole purpose is to surrender the license and decommission the project, as is the case here." It says FERC has already noted that the pending decision as a "major federal action" with significant impacts. It also argues that the transfer and surrender processes must be treated as the same project. Siskiyou County says that NEPA emphasizes a comprehensive and up-front environmental analysis to ensure that an agency will not act on incomplete information. The motion raises environmental impacts that include potential harm to protected fish species, and the "anticipated release of millions of cubic yards of contaminated sediment," along with loss of water storage capacity that can be used to mitigate for drought and serve as protection from wildfires.

On May 9, Jackson County, Ore., filed a letter to FERC signed by its three commissioners, asking the agency to take no action that would allow the removal of the four dams. The letter called the dams "vitally important" to multiple counties, which at one point were participants in the Klamath River Basin Compact. It states that removing the dams could endanger the safety of its citizens, as water held back by the dams could be used to fight wildfires. "Siskiyou and Klamath Counties have met numerous times to stand united against dam removals and worked to develop alternative solutions. Jackson County also encourages the FERC Commissioners to explore all potential alternatives to the removal of the dams," the letter states.

FERC also approved six members to serve on a newly formed board of consultants, which will offer independent recommendations on PacifiCorp's proposal to remove four lower Klamath River dams.

The May 22 letter of approval, signed by the director of FERC's Division of Dam and Safety Inspections, David Capka, also outlined future steps to be taken.

The board members were initially proposed by the Klamath River Renewal Corporation (KRRC), which was formed to take over a license for the lower Klamath River dams and oversee their removal and river reclamation.

The group--Dan Hertel, James Borg, R. Craig Findlay, MaryLouise Keefe, Ted Chant and Robert Muncil--has expertise in civil engineering, geotechnical engineering, and aquatic and terrestrial biology, and experience with dam removal and restoration.

The new board will review and assess all aspects of the proposed dam-removal process and the financial ability of KRRC to carry it out.

The four-page { letter} details expectations of the board, including holding meetings at important milestones for the initial review, design, investigations and analyses of dam removal. The meetings, the letter said, should be attended by PacifiCorp, KRRC, consultants and sometimes FERC staff.

Once PacifiCorp and KRRC file a definite plan for dam removal, expected in July, the board will meet to determine the adequacy of cost estimates, insurance, bonding and overall financial resources. FERC staff will then offer its comments or questions, and the board will address those with its independent views and recommendations.

The sequence of events, outlined in an attachment, will be:

  • The board will review the Definite Plan for the dam-removal process once it's completed by PacifiCorp and KRRC;
  • FERC will decide whether to transfer PacifiCorp's license for the four dams to KRRC, and if it's denied, FERC will seek comments regarding next steps;
  • If the transfer is approved, FERC will issue a public notice of the surrender application;
  • The board will review the plan for surrendering the license;
  • FERC will make a decision on the surrender application; and
  • The board will review ongoing construction and mitigation work.

The letter notes that still pending is FERC's decision on whether to stay its March 15 decision that amended PacifiCorp's license--basically splitting its Klamath River projects into two licenses--but did not transfer the license for the lower dams to KRRC.

Meanwhile, the Oregon Department of Environmental Quality is planning to hold two hearings to accept oral comments on KRRC's application for a Section 401 water quality certification related to decommissioning of the J.C. Boyle Dam and associated structures.

The agency finished a { draft certification} for the proposal, finding the project would result in discharges to the Klamath River that may adversely affect short-term water quality by reducing dissolved oxygen levels and increasing sediment.

"However, DEQ has determined the action will result in a net ecological benefit by increasing access to salmon habitat and improving long-term water quality," a news release from the state agency said. The draft certification would require KRRC to limit sediment runoff, revegetate the reservoir, and monitor water quality to protect fish and other aquatic life.

The hearings are separate from KRRC and PacifiCorp's application to FERC to amend the license for eight Klamath River dams by splitting them into two separate licenses, and transferring the license for four of those dams to KRRC, a nonprofit corporation formed to remove the dams. In that process, currently underway, PacifiCorp and KRRC are working on a detailed plan to decommission the J.C. Boyle Dam and three other dams on the Klamath River in California.

The Oregon DEQ's hearings on water quality impacts of the proposed removal are at 2 p.m. and 6 p.m. on June 12 at the Oregon Institute of Technology's College Union Auditorium, 3201 Campus Drive, Klamath Falls.

Written comments, which must be submitted by 5 p.m. on July 6, can also be sent to Chris Stine, Hydroelectric Specialist, DEQ, 165 E. 7th Ave. Suite 100, Eugene, OR, 97401. -K.C. Mehaffey

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Publisher/Editor-in-Chief: Mark Ohrenschall, Editor: K.C. Mehaffey
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