Representative Huffman Comments on PG&E’s Plans for the Potter Valley Project
After the February 23rd Eel-Russian River Commission meeting in which PG&E acknowledged that the value of the Potter Valley Project (PVP) is primarily as a water transfer of regional importance, US Congressman Jared Huffman gave some straight-forward input on the topic in his weekly phone conversation with the KMUD Newsroom.
When asked, ‘How did you originally learn about PG&E’s plans to divest itself from the PVP?’ Huffman said,
It may have come as a surprise to folks who were at the Eel-Russian River Commission, and heard PG&E explain its considering these various ways to abandon or transfer the project so that it would no longer operate it.
It doesn’t come as a surprise to me and the reason is I’ve familiarized myself with the project quite a bit with the project. Ive had lots of conversations with stakeholders.
And I’m aware that the economics of these small one-off hydro projects, like Potter Valley, are not what they used to be.
PG&E is facing a potentially very long very expensive re-licensing process. There’s not a lot of power generated by this project, and PG&E can probably have less headaches and better economics if it secures that power elsewhere– if it’s able to get out of this project–as opposed to going into this open-ended process where there could be many millions of dollars of mitigation costs and a lot of uncertainty in whether they’d be able to divert the amount of water needed to generate enough electricity.
So just a huge amount of questions that from a business standpoint would lead PG&E to this point. I’m not surprised.
When asked, ‘If decommissioning one or both of the dams became the wisest choice, where would the money to do that come from?’ Huffman deflected to the water supply priority.
Well, this is where it gets very complicated. As a hydro-power project, the PVP is fairly fungible. Its not a huge project. Nobody is out there really depending on it for their power. And PG&E can replace it. As a water project, it’s a lot more valuable to a lot of folks.
You’ve got interests in Mendocino, Sonoma and even some communities in Marin County that would have water supply impacts if those diversions were completely cut off.
So there’s all kinds of questions when you think about a possible decommissioning scenario. Would all of the infrastructure come out, or could some of the run of the river diversion continue for communities that over the last hundred years have come to rely on that water. …and I should emphasize, you have some communities that don’t have any other water. Places like Potter Valley in Mendocino County. This is the only water they really have. You have other communities that have some other options.
And you also have some solutions like raising the dam on Lake Mendocino that could help those interests scale back the amount of water they would need to rely on from the Eel River.
So there’s all these pieces that are going to be part of an interesting conversation going forward to find out if there are solutions that can satisfy both basins, that can give us opportunities to make improvements on the Eel River, but also not completely eliminate the water supply for folks who depend on it on the Russian River basin side.
I am actively exploring that in a stakeholder process. Although, as a member of Congress, I don’t have authority to dictate a solution to this tricky problem, I am interested in trying to take care of the needs of both basins.
When asked, ‘Will the stakeholder meetings continue?’
They will continue as long as folks want them to continue. I cannot compel them. But so far we’ve got I think a lot of the essential stakeholders around the table they are engaging in a constructive dialogue about a possible two basin solution that everyone could live with and I think that’s an important conversation. If anything its become more important with PG&E hinting a little more directly that it may be interested in walking away from the project.
When asked, ‘Who represents the fish and the Eel River interests, and if their voices are heard’, Huffman listed The Pacific Coast Federation of Fishermen’s Associations (PCFFA), California Trout, Trout Unlimited, Friends of the Eel River, the County of Humboldt, Round Valley Tribe, and the Wyott Tribe, and then he said, “And I’m no slouch when it comes to fish protection either.”
Huffman continued, “A lot of folks are looking at how can we do the right thing by the fisheries, as we explore these water management possibilities.”
When asked, ‘What do you know about how FERC’s (Federal Energy Regulatory Commisison) strict application timeline impacts PG&E opportunity to make decisions,’ Huffman responded,
What I know about FERC’s process is that it takes a very long time. It is very expensive. And there is not a great amount of certainty at the front end of that process. So I think PG&E is looking at this as any business would: they’re weighing the costs and benefits and trying to decide whats best for their ratepayers and their shareholders. I don’t think anyone could blame them for looking at the downside of pushing through the re-licensing process.
When asked, ‘It appears PG&E has continued to operate the PVP because it did not want to remove the water source from the Russian River. Do you have any comment about that?’
This is not a simple extraction. If PG&E were to decide they wanted to leave the project– as fungible as the power is, the truth is that for the last hundred years, this has been largely a water project. Even though the water rights and other aspects of it don’t necessarily reflect that. The politics certainly do.
I think PG&E would love to hand off this project if there could be a way to do that that took care of everybody.
If their walking away from this project meant pulling the rug out from under communities in Mendocino and Sonoma Counties, that don’t have any replacement supplies, I think they would be sobered by that. I don’t want to speak for them. Someone should ask them about that, but I think that has given them pause. Because they represent power customers on both basins here.
So they would love for some consensus to emerge, I believe, that takes care of the water needs, and potentially lets them off the hook for a power project that may not make a lot of sense going forward.
And regarding Humboldt Bay Municipal Water District’s ongoing desire to share supply with municipalities on the north coast, Huffman laughed, then said,
The Humboldt water district has a problem that most water districts in California would love to have. They have water that they can’t use, and they don’t want to lose it. So, they want to find some beneficial use so they don’t lose this water right that originates back in the time of an active mill using huge volumes of water that no longer happens.
I can’t blame them for not wanting to lose that water right. But I think the idea of transporting that water anywhere in the state and getting the place of use and purpose of use permit changes and navigating all the opposition and controversy that would accompany that would be a pretty uphill challenge. I don’t see it happening.
In a phone interview a few days later, Dave Moreno spokesperson for PG&E said the company continues to operate the Potter Valley Project because “as a company, we recognize the water benefits of the project that have existed for many decades.”
Lawsuits kept the last fifty-year license from being issued from 1984 when it was due until 2004 when the National Marine Fisheries Service (NMFS) issued it’s Biological Opinion for the proposed license amendment as a result of lawsuits under the Endangered Species Act.
The Biological Opinion reduced the amount of water diverted from the Eel River to the Russian River by 50% to 75% depending on the water year. It also mandated releases into the Eel River that as Moreno said, “mimic natural flows.” Moreno also said that summer flows in the mainstem of the Eel River are now increased over natural flows because “Lake Pillsbury holds winter runoff that would otherwise flow out to sea.”
Thank you KMUD News for including these questions in your conversation with Mr. Huffman