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Dam Loss Won't Hurt Economy, New Study Says by Chris Mulick, Herald staff writer Tri-City Herald, September 5, 2002

OLYMPIA -- Environmentalists released a new study Wednesday suggesting replacing the four lower Snake River dams with conservation, gas-fired generators, solar stations and wind farms would have a negligible effect on the economy.

The study compiled by the Rand Corp., a California-based think tank, indicated the effect on the states of Montana, Idaho, Washington and Oregon would be "plus-or-minus fewer than 20,000 jobs," or less than one-third of 1 percent of all potential jobs.

The environmental lobby called the development "an important volley" in the dam removal debate, which has been dormant since before President Bush took office.

"This issue has not gone away, and it's not going to go away," said Steve Moyer, Trout Unlimited's vice president for conservation programs.

Nancy Hirsh, policy director for the Northwest Energy Coalition, said she'll take it to the Northwest Power Planning Council, which is just beginning to develop its new five-year power plan. She called the study's assumptions for boosting employment "very conservative."

In Olympia, Washington Gov. Gary Locke said the region should focus on nonbreaching alternatives to restore salmon runs.

"We need those dams," he said. "We should look at other ways."

The $75,000 study, funded by the Pew Charitable Trusts, uses data from existing federal energy studies to develop a series of economic outcomes should dams be breached and more money be invested in conservation, solar projects and wind farms. The study presents scenarios in which a dam a year would be breached beginning in 2007 or 2010.

Though agriculture would suffer, the study stated temporary jobs would be created through projects to modify railroads, highways, irrigation and other water use systems. Permanent economic benefits would be realized through additional recreation and tourism plus investments in energy efficiency equipment.

But the study makes some assumptions when considering environmentally friendly power plants and conservation as a substitute for dams and gas-fired generators that may not hold.

It assumes a critical federal tax credit, which is scheduled to sunset next year, will remain on the books for wind farms. That subsidy cuts the cost of wind power from new projects by as much as one-third.

The study also assumes a prolonged boom in wind farm construction would create jobs from companies that would manufacture turbine components in the Northwest. But the world's largest wind turbine manufacturer recently announced it is postponing plans to build a plant in Portland that would have employed 1,000 workers, in part because the tax credit has not been made permanent.

Hirsh said Vestas Wind Systems or other turbine manufacturers may yet build facilities in the region.

The study also compared conservation and wind power costs against gas-fired plants with assumptions that gas prices could as much as double by 2020. By comparison, a consultant to a state panel helping to develop Washington's energy strategy recently projected long-term prices would rise by as much as 20 percent and that prices will be capped naturally by the availability of liquefied natural gas offshore.

Further, the study also assumed new conservation measures could be implemented at a price of between 1.5 cents per kilowatt hour and 3 cents per kilowatt hour. That may have been true before weatherization programs took hold in the 1980s but not today, said Chuck Dawsey, manager of the Benton REA and a member of the advisory committee working on the state's energy strategy.

"The easy stuff's done," he said.

Most agree the Northwest needs to diversify its power portfolio, of which two-thirds is composed of hydropower. Natural gas-fired generators are expected to provide most of the new energy introduced in the region.

The study considers the benefits of replacing 20 percent of that energy with conservation or renewable power plants instead.

That's enough energy to require 30 new wind farms the size of the massive Stateline project southwest of Walla Walla, the world's second largest.

Such diversification would insulate the region from the whims of the weather, which in a drought year can wreak havoc on power production and fish runs.

Environmentalists say the study proves the Northwest can maintain its economy while restoring fish runs through dam breaching.

"There are a lot of factors providing positive impacts and negative impacts," said Mark Bernstein, who co-wrote the study. "They basically wash out."