Co-op and Northwest utilities concerned about river treaty

Flathead Electric Cooperative has joined a group of 70 Pacific Northwest utility companies in criticizing draft recommendations that could modify the 50-year-old Columbia River Treaty.

The Columbia River Treaty Power Group, an alliance formed in 2011 to evaluate the future of the treaty, claims they haven’t been adequately represented, and that suggested recommendations could cause economic impacts to ratepayers and the region. The utility group represents 6.4 million utility customers.

Signed in 1964, the Columbia River Treaty is an agreement between the U.S. and Canada for the development and operation of dams in the upper Columbia River basin that provide hydropower and flood control. The Libby Dam in Montana and three dams in Canada were constructed under this treaty.

The treaty could be terminated or modified in 2024. Changes recommended for the treaty must be submitted by the Bonneville Power Administration and the U.S. Army Corps of Engineers by the end of this year. Recommended changes would be presented by U.S. State Department in negotiations with Canada over the next decade.

A group called the U.S. Entity issued draft recommendations for the treaty on June 27. The utility group’s criticism of those draft recommendations fall under two main issues — how power generated from water that originates in Canada and flows into the U.S. is equitably distributed, and how the scope of the treaty might be expanded to include additional environmental mitigation.

A provision in the Columbia River Treaty currently requires the U.S. to return hydropower to Canada, currently valued at $250 million to $350 million a year. In return, the U.S. benefits from flood control operations by Canadian dams.

In an Aug. 8 letter to the U.S. Entity, the utility group said the current methodology used to calculate this entitlement “represents a significant mismatch between payments to Canada and diminishing ongoing downstream power benefits in the U.S.”

Expanding the scope of the treaty to include “ecosystem functions” also is unacceptable to the utility group.

“Nowhere does the draft recognize the substantial investments in ecosystem functions made outside the treaty for decades,” the utility group’s letter states. “Regional electric customers have invested billions in fish protection efforts, and each of the entities providing the Canadian Entitlement already have robust environmental mitigation plans embedded in their project authorizations.”

Flathead Electric Cooperative general manager Ken Sugden expressed his concerns about the draft recommendations in a separate letter he sent to Montana’s congressional delegation. He said the ecosystem recommendations “in many cases will have negative financial and operational consequences on our utility members.”

“From our view, renegotiating an existing international treaty is not the place to conciliate specific United States ecosystem issues, especially considering all of the current non-treaty environmental efforts ... and the multiple fish and wildlife recovery plans we have in place today,” Sugden wrote.

Sugden said the Co-op and other utilities must be better represented in drafting any future recommendations for the treaty.

“Without their representation, all Northwest utility customers most likely will face unfair and significant economic disadvantages that could harm the economy,” he wrote.