More time sought for Potter Valley Project license takeover

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Eel River
The Two Basin Partnership has asked the Federal Energy Regulatory Commission for more time to complete a series of studies for its application to take over the license for the Potter Valley Project. (Nathan DeHart – Ukiah Daily Journal file)

By Isabella Vanderheiden | Times-Standard, 09/09/2021

A group of Northern California agencies, known as the Two-Basin Partnership, have asked the Federal Energy Regulatory Commission to press pause on its application to take over the license for the Potter Valley Project. If granted, the delay would provide agencies additional time to work out a water plan and to develop strategies for dam removal and restoration of the Eel and Russian river basins.

“Our request to federal regulators is simple,” said Curtis Knight, executive director of CalTrout in a prepared statement. “Taking over operations of the Potter Valley Project and updating the facilities will be expensive and complicated, and we need more time to figure out the details.”

Pacific Gas and Electric Co. has been looking to rid itself of the Potter Valley Project — a water diversion system in the Eel River basin — and the costs associated with it for years.

Rep. Jared Huffman (D-San Rafael) facilitated initial discussions to create a “two-basin solution” for the project and established the Potter Valley Project Ad Hoc Committee in 2018.

In January 2019, PG&E submitted a letter to FERC providing notice that PG&E would not submit an application to relicense the project which is set to expire in April 2022.

The Two-Basin Partnership — California Trout, Humboldt County, the Mendocino County Inland Water & Power Commission, the Round Valley Indian Tribes and Sonoma County Water Agency — filed a proposal to acquire the project in May 2020 with the intent to remove the Scott Dam and restore fish passage to hundreds of miles of historical habitat.

Craig Tucker, a natural resources policy consultant, said the Two-Basin Partnership filed an abeyance with FERC on Sept. 2.

“We’re basically asking for time out to figure out the best path forward,” Tucker said. “I’m anticipating that there’ll be some parties who will say, ‘Yes, please give them more time so they can solve this problem’ and I’m sure there will be other parties that are going to say the groups have had enough time and if they can’t figure it out, let PG&E surrender the project.”

PG&E spokesperson Paul Moreno told the Times-Standard, “PG&E has indicated its willingness to discuss the early sale and transfer opportunities but the (partnership) would need to initiate that process.”

The Two-Basin Partnership must first complete a series of studies that will cost upwards of $25 million.

“PG&E has so far refused to offer financial support to the partnership, which must complete a long list of studies as a first step to licensing the project,” according to CalTrout. “Without the $25 to $30 million required to complete these studies and file a license application, the partnership will dissolve, and PG&E will be left with a major liability. PG&E’s own public records indicate that it would lose several million dollars each year just by maintaining the existing facilities.”

Moreno asserted that there is “really no mechanism for PG&E to provide funding to another party” to complete the series of studies.

“PG&E has provided the appropriate level of support for the new license process and we are participating, as required by FERC, as the owner and operator of the project,” he said. “… PG&E will continue to own and operate the Project in accordance with the terms and conditions of the current Project license and all laws, rules, and regulations governing the operation of the Project until a new license is issued or the project is decommissioned.”

Alicia Hamann, executive director of Friends of the Eel River, urged the Two Basin Partnership to withdraw its notice of intent to relicense and “support the quickest and surest path to dam removal on the Eel River.”

“PG&E’s refusal to pay for the costs of relicensing creates a huge hurdle. Even if the (partnership) somehow came up with the (funds) needed to finance their relicensing process, several other obstacles remain,” she said. “The lack of meaningful support from Russian River interests, which stand to benefit the most from this proposal, means there is yet no proposal to monetize any future water diversions, and thus no way to support the costs of maintaining a diversion.”

Further delay only heightens the unacceptable risks to the Eel River and its fisheries, she said.

“Surrender and decommissioning of the project is inevitable,” Hamann added. “A just resolution can still be achieved by recognizing that reality.”

If FERC denies the extension or if the Two-Basin Partnership agreed to withdraw its proposal, PG&E would continue to operate the project as long as the license remains in place. If the license is not transferred by April 2022, Moreno said FERC can grant PG&E an annual license.

FERC will decide whether to grant to extension in the next 60 days.

More information can be found at and

Isabella Vanderheiden can be reached at 707-441-0504,