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Pud Lays Out Facts On Possible Dam Purchase

Approximately 40 people attend Jan. 15 session

The Klickitat Public Utility District covered all the basics during a public meeting concerning the PUD's possible purchase of Condit Dam.

In a Jan. 15 session at the Park Center attended by approximately 40 people, the PUD discussed its recent review of whether it would be economically efficient to purchase the 1913-era dam as a hydro-electric power resource.

The dam, on the White Salmon River 3.3 miles upstream from the Columbia River, is owned by PacifiCorp, a Portland utility. It is scheduled to be decommissioned and removed in 2006.

Whether Condit Dam -- with a projected price tag of $63.5 million -- would be a smart move or a boondoggle for the PUD is yet to be formally decided, and that reality was reflected in the opening comments of PUD Commissioner Randy Knowles.

"To date, no decision as to how to proceed on this issue has been made," Knowles said.

Tom Svendsen, power manager for the PUD, pointed out that the estimate of required upgrades at the dam facility alone totaled about $14.5 million. Upgrades would include replacing the turbines with modern design; upgrading the generator; replacing the existing transformers, and much more.

"The dam is there, but most everything else would have to be replaced," Svendsen explained.

Brian Skeahan, manager of the PUD, said estimates pegged the increase in the average residential customer's bill at an added $91 per year if the PUD were to acquire the dam.

Skeahan said the only way to get the purchase price down would be to eliminate some of the improvements or the fish passage requirement, or obtain a grant.

Several people had questions about the cost estimates related to buying the dam. Questions included:

Did the PUD look at the projected lifespan of the dam? PUD response: No.

Did the PUD include costs to purchase the land PacifiCorp owns around Northwestern Lake? PUD response: No.

Did the PUD include possible dam decommission costs? PUD: No.

PUD officials said to date there had been no discussions with PacifiCorp regarding purchase of the dam.

"There has been no discussion with PacifiCorp whatsoever," said Svendsen. "This is a real preliminary study to see where it would go."

Skeahan went over the history of the dam in recent years, especially regarding the 1999 "Settlement Agreement" in which the dam owner and a number of organizations agreed on a plan to remove Condit Dam.

Skeahan pointed out that the Klickitat PUD and the Skamania PUD sent letters in summer 2001 to express support for keeping Condit Dam in place and functioning as an energy resource.

"That's different from saying the PUDs wanted to own Condit," Skeahan added.

He also pointed out that the Federal Energy Regulatory Commission (FERC) process does not allow the PUD to compete for a Condit Dam license at this time, and there is no guarantee the PUD will be able to later.

Skeahan listed three possible options for PUD:

Do Nothing. "Condit appears expensive; PacifiCorp appears to have put itself in position to either implement the Settlement Agreement or to relicense itself; development of viable alternative to keep Condit would be time-consuming and expensive."

Intervene in PacifiCorp's application. "May or may not be possible. FERC has not issued a notice of the surrender application which could present opportunity for PUD to become an intervener; putting forward a viable alternative retention proposal would be expensive and time-consuming with a very uncertain outcome; Estimates are that process would not be complete until end of decade; PacifiCorp and other parties to Settlement Agreement appear committed to the terms of agreement; these parties could be counted on to be adversarial to an attempt to block removal."

Other? No possibilities were listed in that category.

Skeahan pointed out that a number of parties signed on to the agreement.

"Frankly, they seem to be committed to that agreement," he said. "We could expect all the Settlement Agreement parties, who want to see that dam go away, to be aggressive in fighting any attempt to overturn the Settlement Agreement. And some of those folks could make you have a real bad day."

Skeahan stressed that there had been no decision as to further process or timeline. Skeahan said the PUD needed to resolve one central issue: Does it make sense to continue exploring the feasibility of acquiring the dam?

"We don't know the process from here," Skeahan said, adding that the deck appeared to be stacked against pursuing Condit.

"It's consultant-intensive, legal-intensive, and highly uncertain," Skeahan said. "By most standards of comparison, if you have to pay those costs identified today, this is an excessive resource compared to other options."

Klickitat County Commissioner Don Struck, who attended the PUD meeting, said he supported the PUD's efforts to consider purchasing the dam.

"I applaud your efforts on this. We're full-square behind you," Struck said. "If the numbers work out, keeping that dam would be a good thing for our constituents. The county is ready to help out any way we can."

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