Irrigators reel under power rate increases - First increment now in effect in Oregon, California
 
 
 
 
April 21, 2006
 
 
 
By Steve Kadel, Freelance Writer
 
Capital Press Agriculture Weekly
 
P.O. Box 2048
 
Salem, Oregon 97308
 
800-882-6789
 
 
To submit a Letter to the Editor: rleidahl@capitalpress.com
 
 
 
Klamath Falls, Oregon -  Irrigators predict dire consequences in the wake of power rate increases authorized by the Oregon and California public utility commissions. The first increment of new rates took effect April 17.

The new rates will be phased in over seven years in Oregon and four years in California.

The boost in electrical rates for 1,400 Klamath Reclamation Project farmers was sought by PacifiCorp, an investor-owned utility with headquarters in Portland. Seven hundred ranches outside the project’s irrigated ground also lose their bargain-basement pumping rates.

The increase hits Tulelake Irrigation District hardest. That’s because the California district has responsibility for sending tailwater from project farms and wildlife refuges uphill to where it reaches the Klamath River. Downstream, the water powers PacifiCorp hydroelectric turbines on its way to the Pacific Ocean.

One of the TID’s largest pump stations has averaged electric bills of $30,000 to $40,000 annually.

“If it goes to tariff rate, it'll be over a million dollars,” manager Earl Danosky said.

Tariff rate is 6.98 cents per kilowatt-hour on both sides of the California-Oregon border.

Under a 1917 contract that was extended for another 50 years in 1956, farmers within the project paid six-tenths of a cent to run pumps. Irrigation districts and the federal government had five-tenths cent KWh rates for on-peak pumping, three-tenths cent KWh for off-peak demands. The 700 ranches beyond the project’s irrigated cropland have since 1956 had a three-quarter cent KWh pumping charge.

“Currently, these customers pay one-tenth of the rate other irrigation customers pay,” said Dave Kvamme, the PacifiCorp spokesman.

He said other customers must pick up the slack.

But Bob Gasser, a Klamath Water Users Association board member, said the project provides benefits to PacifiCorp that should be rewarded by a lower electric rate.

The Klamath River has more water now than before the project existed, he said. Water from Lost River used to go into Tule Lake and evaporate, but now is pumped back to the Klamath River, Gasser said.

The TID’s Pumping Plant D, completed in 1942, has two 700-horsepower and three 750-horsepower units, which can move over 208 million gallons of water daily.

“There’s no standing water in this system, and that’s what makes it so efficient,” Gasser said.

PacifiCorp’s hydroelectric turbines on Klamath River run during summer because of water stored in Upper Klamath Lake during the winter, another benefit from the project, he said.

“That’s why we think we deserve a (lower rate),” Gasser said. “It’s not because we're good old boys.”

The Oregon PUC order leaves the door open for evidence of that benefit. Faced with a deadline as the contract expired, the PUC didn't consider a document the water users obtained March 20 that was part of PacifiCorp’s filing for hydroelectric license renewal from the Federal Energy Regulatory Commission.

The Oregon commission outlined steps irrigators must take to make their case for a credit.

Steve Kandra, president of the Klamath Water Users Association, said the Oregon PUC acknowledged benefits from the project in its decision to implement higher rates. It gives a ray of hope for irrigators.

“The commission recognized the irrigating community has a valid assertion when we say we provide a benefit for the utility,” he said. “We recirculate water and put it back into the system so it does not disappear.”

Scott Seus, a California farmer who is the Klamath Water Users’ Power Committee chairman, took a philosophical approach to the PUC rulings.

“It’s not a home run, but a double,” he said. “This (phase-in) kept us from falling off the cliff this season.

“The commission came out somewhere in the middle. That’s probably a reasonable approach. It gives us breathing room.”

California’s PUC promised it will allow the same arguments this summer when formal hearings begin on a PacifiCorp request for a general rate increase for all its California customers.

Staff Writer Tam Moore contributed to this report.
 
 
 
Copyright 2006, Capital Press.