By Marcy Stamper
After more than half a century as a disused concrete spillway, powerhouse and reservoir, Enloe Dam may be closer to its next phase in life — either being retrofitted to generate power or removed entirely.
The Okanogan County Public Utility District (PUD) has seven months to seek an extension from the Federal Energy Regulatory Commission (FERC) on the license to build the dam, which is on the Similkameen River near Oroville. Even with that extension, the PUD would face a tight deadline — two years for engineering and design and another three years to complete construction, according to PUD General Manager John Grubich.
The PUD recently solicited proposals to find other entities interested in buying, building or operating the dam, or some combination of those functions. The PUD board of commissioners and staff reviewed three proposals on Monday (Nov. 17), but determined none of the proposals met the technical or legal requirements, said Grubich at a public meeting about the dam that evening.
At the same time, the Hydropower Reform Coalition has been in discussions with the PUD about the possibility of removing the dam, according to Rich Bowers, northwest coordinator for the group. An updated economic study released this week by the coalition projects the dam would lose between $1.1 million and $1.5 million a year.
The estimated cost to build the dam is $39 million, on top of $12 million already spent on the licensing process, said Grubich. Project costs in a worst-case scenario are $45.5 million.
The PUD expects to borrow $40 million to build Enloe, with estimated interest payments of $29 million over the 30-year term of the bonds, according to Grubich.
Bowers said his group has estimated it would cost $35 million to remove the dam. They have a list of potential funding sources and Bowers said he is confident they can raise the money for removal if the PUD supports it.
To seriously consider removal, Grubich said the PUD wants to see a solid commitment from a lead agency and a firm source of funding.
At Monday’s meeting, the PUD presented projections of the utility’s costs and revenue over the next 50 years, with and without Enloe Dam. All scenarios showed that Enloe would add to the district’s annual costs until the bond is paid off, in around 2047 to 2049. The PUD’s comparison did not include the costs of removing the dam.
Depending on how the power generated at Enloe is used, it would account for small differences in the cost per megawatt hour. “We’re 25 to 60 cents cheaper 55 years down the road with Enloe,” said Dale Dunckel, the PUD’s power resource analyst.
“I look at numbers for a living,” said PUD Commissioner Steve Houston. “The difference in numbers that far out is insignificant. It’s not even within the margin of error.”
Support for building
Despite favorable projections for the cost of energy production from Enloe compared with other future sources of power, Houston said he was concerned about the PUD’s debt and aging infrastructure, and about the PUD’s ability to support the personnel necessary to operate Enloe.
While acknowledging uncertainty over Enloe, the two other commissioners appeared to support building it. “I don’t want to be one of those guys seen as not far-sighted enough. It’s a bit more expensive now, but in the long-term it could be a benefit for the county,” said Commissioner Ernie Bolz.
“We can’t really leave it there,” said Commissioner Dave Womack, who said operating the dam would be the least expensive option. “In the current climate, dams in the river are low-hanging fruit for removal.”
Scott Vejraska, who defeated Womack in the recent election and will be sworn in on Jan. 5, called Enloe “a good project.” Because of the sediment behind the dam, Vejraska said tearing out Enloe is not an option, although he voiced concerns about debt and aging infrastructure. “What’s it going to add to bills every month?” he asked.
Many members of the public who spoke at the meeting also supported building the dam, hoping it would provide more energy independence. Several expressed concerns about rising costs to ratepayers.
One remaining uncertainty is what is in the sediment that has collected behind the dam over the years, according to both Bowers and Grubich. While the sediment has been stable, removing the dam would disturb it, creating the potential for contamination. Preliminary sampling has not suggested any “smoking gun,” but detailed studies would have to be done as part of any removal plan, said Bowers. Removing the dam would be closer to $20 million if there are no contaminants in the sediment, he said.
“As it stands now, the PUD has a license to build a hydro project,” said Grubich. Any entity that takes over the dam would have to have adequate finances to protect the ratepayers, he said. “If they have the financial stability of the PUD, we’d consider selling it,” he said. “They can do what they want—if they want to tear it down, they can.”
In addition to the FERC deadline of July 1, 2015, the PUD has to allocate funds in the 2015 budget for the next steps on the dam.
If it decides to remove the dam, the PUD would have to submit a new application to FERC, which Grubich estimated would take as long and cost as much as the initial application for the license to restart the dam. A FERC spokesperson said the agency evaluates each individual project and decides what steps are necessary if an applicant wants to surrender a license.
There is still a pending appeal by American Whitewater seeking to limit the amount of water the PUD would be able to divert to produce power, which could also affect the economics of the project.
The commissioners will make a decision on Enloe at a future meeting.
