Two-Basin Solution Progresses, But Questions Remain About Dam Removal

by Caroline Griffith

The Scott Dam is one step closer to coming down, allowing Eel River salmon passage to upstream habitat for the first time in a century. The dam is part of the Potter Valley Project (PVP), a hydroelectric project on the Eel River that was first licensed in 1908. Consisting of two dams, a mile-long water diversion tunnel and a hydroelectric plant with a 9.4mw capacity, the PVP has been controversial for years. Not only does the Scott Dam block river access for federally listed salmon species, but the project also stores winter run-off from the Eel River basin and diverts an average of 65,000 acre-feet of water to the Russian River basin. 

The Scott Dam on the upper Eel River is one step closer to coming down. Photo courtesy of Rob Badger and Friends of the Eel River.

Current owner, PG&E, announced in January 2019 that it would not seek relicensing from the Federal Energy Regulatory Commission (FERC), citing economic concerns. Now, a coalition of five stakeholders from Eel River and Russian River communities has filed a Feasibility Report with FERC outlining a proposal to take over the PVP and remove the Scott Dam. Because of the fact that the fate of this project affects both the Eel River and Russian River basins, an ad hoc committee brought together by Congressman Huffman in 2017 has been working towards a “Two Basin Solution,” with aspects that will restore volitional fish passage while protecting water supply for the Russian River Valley. The coalition that submitted the report to FERC is called the Two-Basin Partnership and came out of Huffman’s ad hoc committee. 

The report lists key elements that must be in place for the Two-Basin Solution to come to fruition. These include a new regional entity with the authority to own and operate the project; removal of Scott Dam and modifications to Cape Horn Dam; a fisheries restoration plan for threatened and endangered species on the Eel River; modification of facilities to ensure reliable water supply to the Russian River Valley and maintain power generation capacity; and new infrastructure to provide a reliable water source to ranchers and farmers in the Potter Valley.

Conservation groups, including NEC member-group Friends of the Eel River (FOER), have been working towards this end for decades, but that doesn’t mean they are all in for this particular project. For Alicia Hamann, Executive Director of FOER, many questions still remain, including questions of who would be included in the regional entity with authority to run the project, and who will be paying for aspects of the project that don’t fall under FERC jurisdiction, including a proposed pipeline that would pump water from Lake Mendocino Reservoir to the Potter Valley Irrigation District.

Prior to deciding not to go for relicensing, PG&E attempted to auction off the Potter Valley Project, but no qualified buyers came forward. According to Hamann, one of the reasons is that the project is not profitable; it is estimated that it loses $30 for every $1 that it makes and it accounts for 0.1% of PG&E’s energy production. It is also an environmental and safety liability, as it is not in compliance with modern environmental mandates to not cause harm to ESA listed species and is, like many dams, located near a faultline. The Two Basin Solution is guided by two “co-equal goals” of providing volitional fish passage and avoiding adverse impacts to Russian River water supply. A fish ladder could cost up to $100 million dollars, and is likely to be ineffective. Taking down the Scott Dam is the only technically feasible and the most economical way to avoid these liabilities and come into compliance with the Two-Basin Solution.

Another controversial aspect to the project is the fact that, for decades, Potter Valley residents have been paying significantly less than neighboring communities for water. The main reasoning for diverting the water is for power generation, so the water that Potter Valley residents receive is considered a by-product. As Hamann says, “In a state where water is gold, it’s like they are getting the gold for free.” 

“While the Eel River’s salmon and steelhead have paid a devastating price, going from a million fish a year to the brink of extinction, Potter Valley has had the benefits of nearly free water for the last century,” said FOER’s Conservation Director, Scott Greacen. “Those who benefit from water diverted from the Eel River in the future will have to cover the associated costs.”

If the proposal by the Two-Basin Partnership doesn’t get approval from FERC, or partners drop out for lack of funding, the project could potentially revert back to license surrender and FERC could start the decommissioning process. If this happens, PG&E may be mandated to remove the facility, which would be considered a capital cost, and it could then apply to the California Public Utilities Commission to recover those costs from ratepayers. So, the challenge now is to negotiate with PG&E to ensure that it pays for part of the dam removal, rather than just handing the burden off to someone else. 

“Nobody wants to pay to keep Scott Dam,” Hamann noted. “PG&E must be held accountable for the damage its dams and reservoirs have done to the Eel River over the last century; they must pay their fair share. The plan suggests a potentially enormous price tag. Getting part way to dam removal won’t do any good for Eel River salmon and steelhead.”

As it said in a statement, “Friends of the Eel River must consider the plan outlined today not as the only hope of Eel River dam removal, but as one possible path to that goal. The question is whether it offers Eel River fisheries a better, faster and more equitable resolution than FERC’s decommissioning process would.”

That said, the staff of FOER are still excited to see the Scott Dam come down. “This is essentially the reason that Friends of the Eel River was founded,” said Hamann. “And we are honored to be able to witness this. Because of the habitat here, we have potential to do some really good things for salmon on the north coast.”