Preliminary Economic Assessment of Dam Removal: The Klamath River
The Klamath River flows over 250 miles from its headwaters in southwestern Oregon through northern California to the coast, where it drains into the Pacific Ocean. The Klamath is one of only three rivers to pass through the Cascades and is the second largest river in California. It is divided into two distinct sections, the Upper and the Lower. A significant amount of water is diverted from the Upper Klamath River for agricultural irrigation within the federal Klamath Irrigation Project, while much of the Lower Klamath runs through the Klamath National Forest. The river and its fish, particularly salmon, are considered sacred by the Native Tribes that live nearby, including the Yurok, Hupa, Karuk and Klamath Tribes.
Historically, the river was considered prime habitat for a variety of species including: Chinook salmon, coho salmon, silver salmon, steelhead trout and Pacific lamprey. Once the third-largest river for salmon spawning on the West Coast, the Klamath River now produces only a fraction of its historic levels. Six dams, constructed between 1908 and 1962, truncate the river and prevent salmon, as well as other anadromous species, from moving upstream. The lowest dam, Iron Gate, sits at river mile 190 and is the current limit of upstream passage for fish moving upstream.
Before construction of the dams began, approximately 600 miles of river and stream channel above Iron Gate were accessible by anadromous fish runs. Significant habitat still exists upstream of the Iron Gate Dam that is not being utilized, and the Long Range Plan for the Klamath River Basin Conservation Area Fishery Restoration Program identified the current lack of upstream passage created by the Iron Gate Dam as a significant impact on the Klamath River anadromous fishery.
The original operating license for the Klamath River Hydropower Project received final approval in 1956 and is set to expire in February 2006. The Federal Energy Regulatory Committee (FERC) is currently overseeing the renewal process for another dam operating license. The Project, which includes the 6 dams on the Klamath River, is currently owned and operated by PacifiCorp, a subsidiary of Scottish Power. The dams collectively generate 151 megawatts of electricity, less than two percent of the power 8,300 megawatts generated by PacifiCorp facilities servicing customers in Oregon, Wyoming, Washington, California, Utah and Idaho.
The FERC renewal application, completed in 2004 by PacifiCorp, did not include any provisions for passage of salmon to rivers and streams above the Iron Gate Dam. For a variety of reasons — including ecological, cultural, and economic factors — stakeholders, including tribes, conservationists, and commercial fishermen, contend that the removal of up to four dams would be a desirable outcome of the re-licensing process.
The purpose of this study is to provide a preliminary assessment of removal of the four Lower Klamath River dams. It will identify and begin to quantify the likely economic impacts, both positive and negative, that dam removal would have on local stakeholders, particularly Siskiyou County, as three of the four dams being considered for removal are located within its borders.
The specific objectives of this study are:
- identify and quantify both the market and non-market values of dam removal to local stakeholders and to the region;
- assess the economic impact dam removal would have on Siskiyou County;
- ascertain the likely impact of dam removal on residential river-front properties; and
- perform a comparative analysis that examines the costs and benefits associated with both the "status quo" and "without dam" scenarios.
Section 2 of this report examines the value of the Klamath River in its present state and the likely costs and benefits associated with a change in the status quo, as caused by removal of the four lowest dams. The costs of dam removal are discussed in Section 3; in particular, those associated with dam deconstruction, alternative power sources and property values. Section 4 identifies likely benefits of dam removal including: return of a free-flowing river, increases in fish populations and benefits to local Native tribes. When possible, the benefits are discussed in economic terms and quantified. The conclusion summarizes the likely impacts of dam removal on Siskiyou County and also notes topics for continued research.
