By DYLAN DARLING
June 17, 2005
Freelance Writer
KLAMATH FALLS, Ore. – There’s a sharp division between
Klamath farmers seeking to preserve discount electric power for irrigation
pumps, and the Oregon Public Utility Commission.
The PUC last week dismissed a PacifiCorp petition to void two 50-year-old
irrigation power contracts with 1,300 Klamath Basin farmers. It ordered the ag
power rates be consolidated as part of a general rate increase proceeding for
all of PacifiCorp’s Oregon customers.
The order sets a Sept. 12 deadline for the PUC rate decision.
Many irrigators want a rate decision held until the Federal Energy Regulatory
Commission has relicensed PacifiCorp’s hydroelectric project on the Klamath
River. The company’s license expires in 2006.
Even if the PUC rules that the irrigators’ rates should go up, that doesn’t
mean they will, said Scott Seus, a Tulelake farmer and member of the Klamath
Water Users Association’s power committee. He said the FERC has the final
call.
The PUC says differently. Last week’s order says the FERC has twice declared
that the rates PacifiCorp charges to its retail customers are not relevant to
its relicensing review. “This commission, not FERC, has jurisdiction over
rates charged by PacifiCorp to its Oregon retail customers.”
Seus said the irrigators are taking the rate issue one step at a time, and they
are still disseminating the PUC’s order. “This is just one little brick in a
brick path from now to April,” he said. “There’s a long time from now
until then.”
In the decision the PUC will address the issues of:
• Statutory standards applicable to the setting of electric rates for basin
irrigators;
• Appropriate rates PacifiCorp should charge basin irrigators; and
• Implementation of any rate change affecting these customers, including how
and when customers have their rates changed from the rates in their current
contracts.
Contracts inked by PacifiCorp’s predecessor in 1956 as part of the previous
FERC licensing set rates at about half-cent per kilowatt-hour for irrigators in
and just outside of the Klamath Reclamation Project.
The contracts within the project expire April 16, 2006. The contract for
off-project irrigators doesn’t have an expiration date, according to the PUC.
PacifiCorp argued that both contracts should be terminated and the irrigators’
rate be brought up to what their counterparts pay around the state.
Irrigators argue that the company benefits from the project’s existence and
that federal law requires that project farmers be offered the “lowest
reasonable rate available,” said Lynn Long, a farmer near Lower Klamath Lake
and chairman of the water users power committee.
“It’s cut and dried, plain and simple,” Long said. What’s not is the
process of determining what the rate should be, he said.
A tangle of jurisdictions, contracts, laws, new legislation and negotiations
make the issue complex.
“That thing is so mixed up that average folks can’t understand it, and I’m
one of those average folks,” Long said.
Along with the project and non-project division, irrigators holding contracts
with PacifiCorp are also in two states. Oregon’s Legislature is working on a
bill that would phase in any rate increase that, if passed, wouldn’t affect
irrigators on the California side of the basin.
Irrigators and PacifiCorp have been in negotiations for a year and a half.
“All of the irrigator parties are arguing that the reduced rate should be a
condition of the FERC license,” said Edward Bartell, a Sprague River rancher
and member of the Klamath Off-Project Water Users.