With years to go until the project is relicensed, signs point to the monetization of water

On June 28, a group of local parties submitted a notice of intent to the Federal Energy Regulatory Commission (FERC) that states its plan to apply for a permit to take over operation of the Potter Valley Project.

The groups involved in the project are California Trout, the County of Humboldt, Mendocino County Inland Water and Power Commission (IWPC) and Sonoma Water. While the current permit for the project is held by PG&E, it announced in January that it wouldn’t be working to renew the licensing past its expiration date of 2022. The Potter Valley Project provides water to Cloverdale, so the question on many citizens’ minds is — how will this shift in power impact what happens with the city’s water?

The Potter Valley Project is a hydropower project that sits in the middle of the Eel River and Russian River watershed basins and is integral in providing water to both Mendocino County and northern Sonoma County. The project itself refers to an interbasin transfer between the Eel River and Russian River watersheds. Included in the operation are two Eel River dams (Scott Dam and Cape Horn Dam), as well as a powerhouse and water diversion facilities.

In addition to providing fish habitats and power through a powerhouse, the Potter Valley Project also provides water to communities in both Mendocino and Sonoma counties. In Sonoma County, water that’s diverted from the Eel River through Lake Pillsbury provides water to Cloverdale, Geyserville and northern Healdsburg. As such, it also serves as the water source for much of northern Sonoma County’s robust agriculture production.

The group still has to get the OK from FERC and submit its feasibility study (a process that has to be completed by April 14, 2020). Once the feasibility study is completed, FERC will decide if it wants to grant the permit to the entities filing.

Though PG&E’s license expires in 2022, IWPC chairperson Janet Pauli said that the company will likely continue to run it on a year-to-year basis until new licensing has gone through.

“To get to a place where the license transfers will probably take a number of years,” she said. “What I imagine seeing here is that PG&E is going to continue to manage and run this project. It probably will not be reliscensened by 2022 — I imagine it will take several years after 2022 and PG&E will continue to operate it on a year-to-year basis until it’s relicensed.”

When the project’s license last expired in 1972 a similar process occurred, Pauli said, as PG&E went through the relicensing of the project (they had already held the license once before) they operated year-to-year before officially being granted another 50-year license of operation.

If FERC accepts the entities’ intent to file and feasibility study, and grants them the license to operate the Potter Valley Project, it could be awhile before they take over operation. However, once that happens, folks in Mendocino and northern Sonoma counties may experience some changes.

“We’ve pretty much been getting our water for free,” Cloverdale Mayor Melanie Bagby said. “What I’ve been hearing is that from now on that water will likely be monetized.”

Bagby also heads the Russian River Watershed Association.

Pauli had a similar sentiment, saying that, should they be granted the license they, “know that part of the financial burden for maintaining and running the final project will be borne by people who are dependent on the water supply.”

Another way to help fund the project would be to build up the number of people dependent on the project as a water source.

“In terms of all of Mendocino County that’s impacted and from Healdsburg north, the broader we build the base of dependency the more manageable the expense will be for everyone,” Pauli said.

The amount that they get from those using the water supply likely won’t be enough to finance repairs and keep the operation going, she said, so the joint powers are also looking at options for federal and state funding as well.

Bagby said that Cloverdale’s shouldn’t be worried about water rights.

“That’s not the problem,” she said. “It’s that if we lose water flow, our water rights are useless.”

At the city level, the possibility of increased water costs isn’t accounted for in this year’s Cloverdale city budget. However, Bagby anticipates it being incorporated as an expense on next year’s budget.

“For now what Cloverdale needs to do is understand that we need a seat at the table,” Bagby said.

Pauli said that once FERC makes its final decision regarding moving forward to partner with the entities, there will be a series of opportunities for people to make public comments relating to the project.

Along the way, both the Mendocino County Farm Bureau and the Sonoma County Farm Bureau will occasionally host public outreach talks to provide updates on where the entities are at in the application process.

“Water is something we can’t take for granted anymore,” Bagby said. “This is the time for people to start getting more real about how we use water.”

To find more information about the project, visit mendofb.org/potter-valley-project-licensing/ and pottervalleyproject.org.

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