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Klamath farmers take on new threat

Klamath farmers take on new threat

Irrigators, faced with steep increases in power, will challenge PacificCorp's rates when a 50-year deal expires next year
Friday, January 21, 2005

Klamath Basin farmers, who have spent years fighting for irrigation water, now face a battle over the flow of another key resource: electricity.

The power company PacifiCorp has notified state officials of the expiration of a deal that for decades has supplied farmers on the Oregon-California line with some of the cheapest electricity around.

It means about 1,300 farms, most in Oregon, could be socked next year with more than tenfold rate increases. Such a steep rise, they say, would unravel the plumbing of a region that depends on electric pumps to move its precious water.

That could make it prohibitively expensive to cycle water through the maze of canals and dikes that keep many fields irrigated and others from flooding. Farmers unable to afford the new rates could see their crops evaporate from the arid landscape.

"The profitability of growing many crops is pretty thin already," said farmer Lynn Long, who leads a group plotting strategy to oppose the rate change. "This would push people over the edge."

The low rates were a condition when the government let PacifiCorp's predecessor build hydroelectric dams on the Klamath River in 1917. Farmers say the company remains obligated to continue the discount, but PacifiCorp says it's not.

Expiration of the rates in 2006 may be the biggest threat to basin agriculture since the federal government withheld irrigation water for protected fish in 2001. Farmers have allotted thousands of dollars to challenge the rate increases before federal agencies and the state Public Utility Commission.

But environmental groups see the looming rate increases as a free-market tool that will achieve what they have been unable to do: eliminate marginal farms and free up water for fish and birds. The utility commission is an unusual forum for environmental issues, but activists plan to tell the panel that the marked down rates prop up farms at the expense of wildlife.

"When this goes away, it's going to be a big step in bringing everything back into balance," said Jim McCarthy of the Oregon Natural Resources Council.

The dynamics have many sides. The rates are related to PacifiCorp's efforts to renew a federal license for the Klamath Basin hydroelectric dams. And the dams themselves are an issue. Native American tribes and environmental activists want the company to remove them or improve fish ladders so salmon can get past and renew migrations upstream.

Farmers say the low rates represent PacifiCorp's payment for the use of local water to generate the power it sells. But the company counters that the water carries so many endangered species restrictions today that it's no longer as valuable.

Others say that if farmers enjoy a continued cut rate valued at several million dollars annually, other PacifiCorp customers would make up for it by paying more.

"Is it fair to have an irrigator in Deschutes County paying a higher rate to create a lower rate for someone in Klamath Falls?" asks Bob Jenks, executive director of the Citizens Utility Board of Oregon, a statewide power watchdog.

Possible fallout from higher rates would reach across the basin, farmers and others say: New sprinkler systems underwritten with some $50 million in federal aid to promote water conservation might become unworkable because of high pumping costs. Wells supplying a government-funded "water bank" that provides extra water for wildlife -- but is depressing the water table -- would become much more expensive to operate. Farmers might return to flood irrigation, which takes less pumping but consumes more water -- potentially compounding the irrigation shortages that reached a breaking point in 2001. Environmental activists would probably renew their call for the government to reduce water demand by buying out ailing farms -- an idea vocally opposed by agricultural leaders. The government could have built its own dams in the Klamath Project but instead let PacifiCorp's predecessor do so as long as it also provided discounted power for the project. The deal was extended for 50 years in 1956, after PacifiCorp won a license for new dams.

It applies to farms in the Klamath Project and some outside the project in Oregon. But it runs out in spring 2006, the time of year farmers normally begin to funnel water onto their fields.

"This is a tough, tough problem down there," said Jon Coney, a spokesman for PacifiCorp. He said the company is trying to find ways to ease the effects on farmers by helping them pursue solar energy or using power during cheaper, off-peak hours. "Let's not pretend that this is going to be easy for anyone."

The company argues that the power deal has run its course. Cheap electricity compensated Klamath irrigators for the value of local water, Coney said, but that value has shrunk as costs have increased and species protections have limited dam operations.

"It's pretty hard for a 50-year-old policy signed in 1956 to have the same relevance today," he said.

Entitlements claimed

PacifiCorp contends utility regulations make it illegal to give Klamath farmers special treatment by charging less than it costs the company to supply them with power.

"It's definitely an issue of equity," Coney said.

But farmers counter they are entitled to the low rates from whomever operates the dams. The Klamath River Basin Compact, an agreement on water use approved by the federal and state governments in 1957, committed to maintaining the "lowest power rates which may be reasonable for irrigation and drainage pumping."

The government let the power company into the basin only because the deal assured power for irrigation, farmers say. Farmers elsewhere also received special rates.

Continuing the rate deal will not cost other PacifiCorp customers any more than they pay now, farmers say. But replacing the roughly 150 megawatts by burning coal or gas will increase costs and carry environmental impacts.

Though Klamath dams together produce about one-seventh the power capacity of Bonneville Dam on the Columbia River, farmers say, they are a crucial element in the basin's lifeline.

"We're talking about a community interest here, because every business is going to be affected by the power rates in one way or another," said farmer Ed Bair. "Farms are just part of the picture."

Michael Milstein: 503-294-7689; michaelmilstein@news.oregonian.com

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