The effort to remove four hydroelectric dams on the Klamath River cleared another regulatory hurdle Thursday after the Federal Energy Regulatory Commission allowed the dams’ original owner to exit its license to operate the facilities.
Specifically, FERC accepted a joint application to transfer the dams’ license from PacifiCorp to the Klamath River Renewal Corporation and the states of Oregon and California.
Following the successful surrender of the license (which is its own separate FERC process), KRRC, a nonprofit, will direct contractors to remove the dams and restore the river within the reservoir footprints.
“Today’s order clears the way for license surrender and decommissioning of the lower project,” said FERC Chairman Richard Glick during the agency’s June meeting on Thursday morning.
The Klamath dam removal effort hit a permitting roadblock last July, when FERC partially denied and partially accepted the license transfer application. Their decision required PacifiCorp to remain on the dam license during the removal, which the utility said went against a core tenet of the Klamath Hydroelectric Settlement Agreement.
The KHSA, signed by Oregon, California, PacifiCorp, tribes and environmental groups, aims to remove four hydroelectric dams on the Klamath River: J.C. Boyle in Oregon and Copco I, Copco II and Iron Gate Dams in California. The dams were built before modern environmental regulations and therefore do not have adequate fish passage, essentially cutting the Klamath Basin in half for migrating salmon. They’ve also been linked to poor water quality and severe fish disease outbreaks on the river.
These structures do not store water for agriculture, nor do they act as flood control infrastructure. Keno and Link River Dams further upstream, which have fish passage, do fill those roles and are not slated for removal. Though the four hydroelectric dams are sometimes referred to as the “Klamath Project,” they are not part of the Klamath Irrigation Project managed by the Bureau of Reclamation.
The agreement would have rid PacifiCorp of the dam licenses prior to drawing down the reservoirs and decommissioning the dams, ensuring the utility would not be liable (financially or otherwise) for any potential hiccups encountered during the removal.
Arguing that PacifiCorp could provide valuable expertise to the project, and that they shouldn’t be able to walk away from the hydroelectric facilities after decades of ownership, FERC ruled that the utility should stay on during the removal process.
While some viewed that as an indictment of KRRC’s ability to carry out the project on its own, the commission’s order last July stated that the nonprofit was, in general, adequately equipped to handle the removal — but that PacifiCorp could provide valuable expertise as the entity that constructed and operated the dams for decades.
“The commission was concerned that the planned decommissioning of the project requires additional legal, technical and financial support that PacifiCorp as co-licensee could bring to the table,” Glick said of the July 2020 order.
That sent KHSA signatories back to the table for four months, after which they announced dam removal would once again move forward with an extra cash pledge from PacifiCorp, Oregon and California. The resubmitted license transfer application also proposed adding the states to the license, along with KRRC, to satisfy FERC’s request for more support for the nonprofit.
“Today’s order concludes that adding the states sufficiently addresses the Commission’s concerns outlined in last year’s order, and it is no longer necessary to require PacifiCorp to remain as a co-licensee,” Glick said.
In a statement, FERC affirmed KRRC’s ability to carry out the project but added that the states will provide the support the agency desires for the project.
“Today’s order confirms that the Renewal Corporation has the ability, financially and otherwise, to undertake dam removal, and with the states, as co-licensees, the necessary legal and technical expertise required for such a huge undertaking,” the statement read.
The $45 million promised by the states and utility would serve as a contingency fund were the project to exceed its $450 million budget, the money for which has already been raised through a PacifiCorp ratepayer surcharge and a California water bond. November’s Memorandum of Understanding also committed the three parties to split any costs above $45 million equally.
By explicitly affirming PacifiCorp’s commitment to the removal project — and bringing the two states onto the license — KHSA signatories hoped the new agreement would satisfy FERC’s requirement for more support for KRRC. FERC’s Thursday order suggests the commissioners agreed.
“In the most recent filing, the parties convinced us that the other states are bringing a lot to the table, and we no longer necessarily need to require that PacifiCorp be part of the consortium that’s going to go forward,” Glick said in a press conference following the Thursday meeting.
The order stated that FERC appreciated the additional funding pledges from PacifiCorp and the two states, despite agreeing that the existing budget (which contains its own contingency fund of roughly $50 million) is adequate to complete the project.
“We continue to find, based on the Board’s prior review, that the $450 million provided for in the Amended Settlement Agreement should be sufficient,” the commissioners wrote. “However, the commitment by the States and PacifiCorp to provide a contingency fund and to cover any costs overruns provides further funding assurance.”
Now, FERC will handle the environmental review of the project’s license surrender application, which would allow it to move forward with decommissioning and removing the dams. That will involve a National Environmental Policy Act (NEPA) review process over many months and comments from the public before the commission makes a ruling on whether to allow KRRC to surrender the license.
“We must also secure FERC’s approval of our Surrender Application, but today’s decision by the Commissioners certainly boosts our optimism about the road ahead,” said KRRC CEO Mark Bransom.
The KHSA parties requested additional time to accept the transfer terms and initiate the license handover from PacifiCorp to KRRC and the states, to the order of 30 days following the future approval of the surrender application. FERC granted that, meaning PacifiCorp will still be the dams’ sole licensee (and therefore responsible for any operation costs) throughout the surrender application’s environmental review process.
Even once KRRC, Oregon and California assume the license for the dams, the FERC order said PacifiCorp will still operate them “until electric operations cease and the project powerhouses are physically disconnected from the grid.”
Current projections from KRRC estimate the reservoir drawdown and removal of the dams will begin in 2023. Contracts have already been signed with construction and environmental restoration firms to carry out the project.
“The future of this project has been hanging in the balance for quite some time now, and it’s important that we provide the licensees and other stakeholders in the region with a sense of certainty as to whether plans to surrender the license and remove the four dams can proceed,” Glick said.
KRRC praised the FERC ruling, which capped off nearly a year of uncertainty over whether the project would actually go forward.
“This is a crucial and significant step forward in accomplishing KRRC’s core mission to remove the four lower Klamath dams and restore a free-flowing river,” said KRRC Board President Jim Root. “I am deeply appreciative to all of the parties who have supported this project over the years, and I wish to especially note the significant and sustained efforts of our Tribal partners.”
Tribal communities in the Basin also rejoiced at the ruling, as the removal project is intended to improve salmon runs the Yurok, Karuk, Hoopa and Klamath Tribes have depended on as cultural resources since time immemorial.
Regina Chichizola, co-director of Save California Salmon, was grateful for FERC’s decision — especially on the heels of the California Fish and Game Commission voting to list Klamath-Trinity Spring Chinook salmon as endangered under the California Endangered Species Act. The listing was made on the basis of genetic differences found between Fall and Spring Chinook salmon, along with tribes’ traditional ecological knowledge concerning the two populations.
“Both of these wins were the result of decades of Tribal and community-led action for the Klamath River, and they came at a time when we need some hope,” Chichizola said. “The devastating juvenile fish kill we are experiencing on the Klamath River is directly related to the Klamath dams, as are the dismal salmon returns over the last couple decades.”
Frankie Myers, vice chair of the Yurok Tribe, said that along with generations of tribal members, the Governors of Oregon and California are to be commended for their “critical role” in getting FERC to approve the transfer.
“The transfer of the four dams represents a major milestone in the multigenerational effort to heal the Klamath River,” Myers said. “This action moves us that much closer to the day when we can begin removing the dams and restoring the river for future generations. Dam removal needs to happen before it’s too late for the imperiled Klamath salmon.”