Thursday decision by the Federal Energy Regulatory
Commission (FERC) has complicated the historic push to
remove four dams on the Lower Klamath River.
After four years of review, FERC
granted the transfer of the license for the J.C. Boyle,
Copco No. 1, Copco No. 2 and Iron Gate dams (collectively
known as the Lower Klamath Project) to the Klamath River
Renewal Corporation, a nonprofit that would carry out the
dam removal. But it requires PacifiCorp, the utility that
currently operates the dams, to remain on the license, too.
The Amended Klamath Hydroelectric
Settlement Agreement, reached in 2016, was a revision of a
2010 deal that failed to get congressional approval. The new
agreement did not require the Department of the Interior to
oversee the decommissioning of the dams, which made it
unbeholden to Congress.
moves forward, the hydroelectric removal project would be
the largest in U.S. history. Indigenous nations — including
the Karuk and Yurok Tribes, which are both signatories of
the agreement — have pushed for the dams to be
decommissioned in order to restore salmon populations on the
Klamath River. The four dams in question do not contain fish
ladders, effectively cutting off salmon migration. Two dams
on the Upper Klamath River, the Keno Dam and Link River Dam,
are not part of the removal agreement, as they contain fish
passage mechanisms and provide irrigation for the Klamath
Under the Amended Settlement
Agreement, PacifiCorp would transfer the license for the
project to KRRC, which would then assume all legal and
financial responsibility for the removal.
To help foot the bill, PacifiCorp
customers in Oregon and California have collectively
contributed more than $200 million to the $450-million
project through utility bill surcharges. The license
transfer was a major step in the removal process, but FERC’s
decision Thursday wasn’t exactly what the parties of the
settlement agreed to.
Bob Gravely, a PacifiCorp spokesman,
said the full transfer of responsibility to KRRC was a key
component of the agreement. But a joint license holds
PacifiCorp (and, by extension, its customers) financially
liable for hiccups in the project.
“Our concern is that if PacifiCorp
remains ‘on the hook’ for dam removal, that the costs of
that could spiral well in excess of what the cost would have
been to simply relicense the dam,” Gravely said. By
remaining on the license, PacifiCorp could be obligated to
pass any additional costs associated with the removal onto
“The Klamath River Renewal
Corporation’s inability to become the sole licensee for
removal of the Klamath River dams denies the customer
protections PacifiCorp negotiated on their behalf,”
PacifiCorp wrote in a news release.
Though FERC approved the license
transfer on the basis of KRRC providing documentation that
it would have adequate funding and ability to carry out the
removal, it cited a “significant degree of uncertainty
associated with the project” as reason to keep PacifiCorp
attached to it.
“Were the Renewal Corporation to be
the sole licensee, it might ultimately be faced with matters
that it is not equipped to handle,” the order said, adding
that it was in the public interest for PacifiCorp, with its
financial resources and prior experience with removing major
dams (namely the Condit Hydroelectric Project on
Washington’s White Salmon River in 2011), to remain
involved. Gravely said that’s been a theme throughout FERC’s
review of the agreement.
“The concern [from FERC] has always
been, ‘What if it takes more? What’s the Plan B?’” he said.
The Commission’s order detailed several requests it had made
of KRRC since the application for the license transfer had
been submitted, mostly regarding the organization’s
estimated costs and contingencies for the project.
While FERC’s surprise ruling doesn’t
spell the end of the project, it means the agreement’s
stakeholders may have to reopen negotiations and further
amend the agreement. KRRC released a statement calling
FERC's decision "a pathway for the project to move forward,"
adding that there is still work to be done.
The order acknowledged that the
parties to the agreement did not ask for a co-license setup,
saying, “PacifiCorp and the Renewal Corporation may elect to
amend their arrangement in order for the Renewal Corporation
to indemnify PacifiCorp for any expenses it bears as result
of it being a co-licensee.”
Gravely said language like that will
be the starting point for evolving the agreement.
“We remain committed to working with
our other settlement partners to keep the agreement moving
forward,” he said.