Hydropower, protecting environment collide on dam licensing

WASHINGTON -- The modest Henry M. Jackson Dam on the Sultan River in Snohomish County hardly looks like a major battleground in the fight over national energy policy.

But the future of the Jackson Dam and hundreds of other hydroelectric dams across the nation is at stake as part of the current Senate debate over energy legislation.

At issue is a proposal by the hydroelectric industry to reshape the rules for relicensing dams.

At its core, the debate is a struggle between producing power and protecting the environment and over modifying a process without creating an advantage to opposing interests.

Decisions by Congress could affect the quantity and cost of power to millions of people in the Northwest. Washington gets 80 percent of its electricity from hydropower, and although federally owned facilities and the Bonneville Power Administration are exempt from licensing requirements, the dams that are covered contribute a significant portion of the state's power needs.

How those dams are treated and how they perform touch everything from people's power bills to the survival of salmon.

The industry, in arguing for changes that will streamline the bulky relicensing process, say it is critical to ensure sufficient supplies in a tight market at a reasonable cost.

The industry's biggest complaint is a requirement that any proposed revision to the operating license be thoroughly studied.

That requirement, officials say, is the reason that it takes 10 years for a license to be renewed and why it costs millions of dollars -- costs that ultimately find their way to customers' bills.

"Anybody and their brother can offer an alternative and have it reviewed," said David Tuft, spokesman for the industry's trade group, the National Hydropower Association. "We're just hoping to find a little balance."

Among the changes that often are considered for dams in the Northwest are fish ladders or fish elevators to help salmon and other species get around dams.

Some recommendations ask that dam operators adjust stream flow to alter the depth of reservoirs. Still other suggestions would affect the way water is moved through a dam to preserve habitat downstream from flooding.

Environmentalists, however, say it is hard to generalize because dams, and the environment surrounding them, must be considered individually.

"This is about a license to use a public resource," said Rob Masonis, director of the Northwest office of the environmental group American Rivers. "These dams will be relicensed under rules written by this Congress, and we have to make sure it's done right every step of the way."

"What we want is a process that has more clarity and efficiency, but that doesn't reduce environmental protections," Masonis said.

Under the current process, the Federal Energy Regulatory Commission is responsible for evaluating and issuing licenses. But it must accept recommendations from a range of agencies, including the U.S. Interior Department, the Forest Service and the Fish and Wildlife Service as well as state natural resource agencies.

It also must consider the views of tribes and other "stakeholders" to ensure that dams comply with all environmental laws.

Environmentalists insist that such a sweeping mandate is necessary to protect a public resource and to ensure multiple uses.

But environmental groups also want changes in the process, including no longer allowing a current operating license to be extended each year while the terms of a new license are being worked out.

That "loophole," Masonis said, encourages utilities to stall, secure in the knowledge that their dam will continue to operate and produce revenue.

The Cushman Dam on the North Fork of the Skokomish River, for example, has been operating under a series of temporary licenses since 1974. Environmental groups want to require utilities to make some environmental improvements in return for getting a temporary license.

Caught in the middle of this bigger dispute is Al Aldrich. As government affairs director for the Snohomish County Public Utility District, Aldrich is guiding the utility's effort to relicense the Jackson Dam.

The permit expires in 2011, but the process is so long and complex, so strewn with obstacles and competing interests that regulators suggest starting a full decade early to improve chances that a decision might be rendered in time.

Aldrich estimates that he is already spending five to six hours a week on relicensing. The utility has hired consultants to begin the assessments and studies that will be needed to defend the request. And he is trying to fathom estimates that relicensing ultimately could cost the Snohomish County PUD between $50 million to $500 million.

"It's pretty complicated," Aldrich said, adding that although he considers himself a strong -- even avid -- environmentalist, some modifications that might be proposed go too far. "It's a very scary proposition, and the result could price (the dam) out of reasonableness. You can get some pretty crazy conditions that are proposed."

All this for a dam that provides, on average, only 60 megawatts of power, less than 10 percent of the Snohomish PUD's 800-megawatt total output.

Over the next decade, 17 other licenses will expire in Washington state, including the Baker River Dam in Skagit County, the Boundary and Box Canyon dams in Pend Oreille County and the large Priest Rapids Dam on the Columbia River in Grant County.

Those dams join 224 others nationwide. According to the National Hydropower Association, an industry trade group, the paperwork alone on those applications will cost $2.5 billion.

The association says it takes eight years in a typical case to renew a license, but there are many cases in which the fight has dragged on for decades.

For an idea of what the future might hold, Aldrich can look to Pend Oreille County. Analysts told county officials it could cost $500 million to bring the Box Canyon Dam, which is similar in size to the Jackson unit, up to current environmental standards.

Everyone -- including Congress -- agrees that the process is broken. It takes too long and costs too much. Critics say the lines of authority are blurred, and the process is tilted in favor of those who want to stall. "If you know you have a sweetheart deal, you want to maintain that as long as you can," said Masonis, with American Rivers.

Aldrich believes the process stalls because there is no central authority that asserts discipline. He likens the interplay of agencies and interests to "warlords in Afghanistan who independently set conditions for running the country."

The energy bill in the Senate contains a narrow provision dealing with dam relicensing. Sen. Larry Craig, R-Idaho, and other senators from the Northwest, including Maria Cantwell, D-Wash., want more provisions. But given the complexity of the issue and its emotional history, few are willing to predict whether they will succeed.

Cantwell is deeply involved in negotiations over new legislative language, but she is vague on what she might support. That worries environmentalists, who fear she may embrace industry proposals.

"We are concerned that your office seems to be supportive of the idea that industry should have a greater voice than states, tribes or the public in determining appropriate environmental protections," Masonis and the leaders of five other environmental groups wrote Cantwell on March 6.

Cantwell says she is still studying the issue and has not provided details about changes she might embrace. "I think everybody would like the process to be more streamlined. But I also think people want to make sure we make the right environmental decisions," she said.

Her staff said the senator is still analyzing a variety of proposals.

The Senate bill contains language already adopted by the House that would continue the current practice of allowing any interested group to propose changes to a dam's operating license.

Environmental groups support that approach because it would improve chances that protections for fish and wildlife are included. And because licenses are valid for 30 to 50 years, environmentalists contend, license applications should be subject to rigorous review.

Dam operators, however, oppose such a broad approach. The industry wants only the license holder to recommend changes, an approach that is supported by Craig and opposed by environmentalists.

Yet with so many irreconcilable differences, no one is willing to predict whether the Senate will find compromise.

"What we want to do is make it as environmentally friendly as possible without creating a system that simply delights in the process itself and is designed to take the unit down or bankrupt a company," Craig said.

Aldrich would be happy with that. But when asked if the wish will be realized, Craig answers as someone who has been involved in the issue for years.

"Am I confident? No. Not yet."

REGULATING THE DAMS

THE BASICS: The Federal Energy Regulatory Commission has exclusive authority to license non-federal hydropower projects on navigable waterways. There are about 2,500 projects operating under a FERC license. Original licenses are typically for 50 years. Relicensing is typically for a period of 30 to 40 years.

WHAT THEY WANT:

The industry: A more streamlined process to speed up relicensing, which now takes an average of 10 years and costs $10 million. Limits on opportunities to recommend changes to a new license, leaving that decision to utilities and state and federal regulators.

Environmentalists: Limit licenses to 15 years and ensure that anyone who wants to recommend a new license requirement will be fully considered. Rigorous review to ensure all environmental standards are met.

WHAT'S AT STAKE:

According to the industry: The nation's energy security. The current system reduces the amount of power that can be produced and increases costs for ratepayers.

According to environmentalists: The future of salmon and other endangered species as well as the long-term health of rivers. Changing the current system would allow production to take precedence over environmental concerns.

P-I Washington correspondent Charles Pope can be reached at 202-943-9229 or charliepope@seattlepi.com

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