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Increasing Salmon Spill at Columbia/Snake Dams: BPA Economic Analysis says $110 Million Annual Loss by Staff Columbia Basin Bulletin, February 21, 2014

The Bonneville Power Administration is circulating an analysis of a proposed spring spill test aimed at salmon recovery at Columbia/Snake River dams that suggests that if implemented for 10 years would lead to an annual loss of $110 million per year in power sales.

In December, The Northwest Power and Conservation Council, in a split vote, decided to ask for "independent" scientific advice on whether spill at Columbia and Snake river mainstem dams should be ramped up to see what kind of benefit such hydro operations might bring to migrating salmon and steelhead.

(See CBB, Dec. 12, 1013, "Council Seeks Independent Science Advice On Proposal To Test Increased Spill At Mainstem Dams" www.cbbulletin.com/429268.aspx)

An "experimental spill" plan proposed by the state of Oregon and others suggested that amendments to the Council's Columbia River Fish and Wildlife Program include recommendations that mainstem dams channel more water through spill gates in spring and summer than is now called for by existing court orders and the NOAA Fisheries 2008-2018 Federal Columbia River Power System biological opinion.

The BiOp outlines measures aimed at improving the survival of Columbia River basin salmon and steelhead listed under the Endangered Species Act.

This month, in an e-mail to the Council, Peter T. Cogswell, acting chief public affairs officer for BPA, said:

"We have received inquiries from multiple parties about potential impacts of the proposal and are engaging in conversations about it as interest in these potential impacts has grown. In fact, I know that at least some Council members have already received preliminary reports about the analysis. We therefore wanted to share it with all of you directly and offer to discuss it in more detail as appropriate. In so doing, we want to emphasize that our analysis is preliminary and is based on the proposal as presented in comments on the Draft FCRPS Biological Opinion as well as the NPCC's Fish and Wildlife Program Amendment process.

"For our analysis, we used the same assumptions that we used in modeling for our most recent rate case, with the exception being we modeled the court ordered spill as the base case here. With the court ordered spill as the base case, we then modeled the incremental effects of the proposal calling for spill to 125 percent Total Dissolved Gas levels. We recognize that the proposed 125 percent spill levels were conditioned on potential biological constraints, but our analysis did not take that into account because these potential constraints were not specified in the proposal. Our estimate of lost power is the resulting difference between court-ordered spill and our interpretation of operations under the proposed test.

"Our analysis indicates that the 24x7 spill test to 125 percent Total Dissolved Gas levels for April 3 through June 20 would reduce the value of FCRPS power generation by about $110 million per year. The replacement cost under the terms of the Tiered Rate Methodology could result in an almost 8 percent wholesale power rate increase. There also would be a significant increase in the social cost of carbon to the region, somewhere in the range of another $50 million per year.

"Additionally, operating the river at 125 percent TDG would limit our flexibility to integrate variable resources and may have other operational implications associated with replacement power and transmission that are not yet well understood.

"These numbers are significant and represent our best attempt to put the impacts of the proposal, as we understand it, into some sort of context for interested parties. That said, they are based on BPA's specific method for analyzing this kind of impact to the hydro system over multiple years and we welcome feedback. We also would be happy to discuss our analysis in more detail with you or other interested parties at the appropriate time. Ultimately, we want to be as accurate as possible in informing deliberations about the proposed test."

BPA's analysis says:

• A Spill Test at 125 percent Total Dissolved Gas from April 3 to June 20 for 24 hours a day has been submitted through a number of venues including NOAA's draft FCRPS Biological Opinion, the federal Action Agencies draft 2014-2018 FCRPS Biological Opinion Implementation Plan and the Northwest Power and Conservation Council Fish & Wildlife Program Amendment process.

• No BiOp fish operations would be 9,400 average megawatts per year (amv); current fish operations, 8,400 amv,; spill test proposal, 7,800 amw. Spill test, in other words, means 600 amv less of federal power generation. (City of Seattle uses about 1,171 amv per year.)

• Lost generation would be concentrated in the Spring: "It would take more than six typical 400 MW combined cycle gas plants to produce the amount of energy removed from the system in the spring."

• 10-year test would reduce value of hydro system by over one billion dollars: $100 million per year in lost firm power (450 aMW per year), $10 million per year in lost secondary power sales (150 aMW per year)

• Oregon's spill proposal increases rates since it both reduces secondary energy sales revenue that offset BPA's operating costs and decreases the number of megawatt hours BPA has to sell – which means BPA's cost per megawatt hour will be higher

• In addition, customers will also have to replace the lost 450 annual aMW of lost firm power they can no longer get from the federal system

• The overall wholesale rate effect to BPA's customer utilities is estimated to be an increase of nearly 8 percent

• Carbon Impacts of replacement energy: 1.9 million metric tons (MT)

• $55 million per year in social cost of carbon; This estimate is based on a study prepared by the Northwest Power and Conservation Council in 2008:-- In the Pacific Northwest, hydro, wind, and other renewables are used before combustion turbines and coal as they have lower costs to run. -- For most of the year, natural gas fired power plants are the last resource brought online to supply power instantaneously and to respond to decreases in hydropower production-- A typical combined cycle natural gas fired power plant emits 800 lbs. of C02 per megawatt hour- A one megawatt hour decrease in hydropower results in 800 lbs. of CO2 production-- The equivalent of about 440,000 cars or 28,000 tanker trucks of gasoline consumed

• The flexibility of the federal hydro system is used to balance changes in resources and loads on a second by second basis.

• Proposed spill test would significantly reduce the flexibility of the FCRPS to respond to changes in loads or wind output.

• The flexibility of the federal hydro system is used to balance changes in resources and loads on a second by second basis.

• Proposed spill test would significantly reduce the flexibility of the FCRPS to respond to changes in loads or wind output.

• The hydro system has limits on what it can provide and still comply with all hydraulic objectives including current fish operations

• Reduced flexibility could severely reduce quantity of balancing reserves that could be provided by the hydro system.

• With the addition of a large wind fleet the need for balancing reserves has increased

• With the spill proposal, new resources likely would be needed to provide balancing services for both existing and future variable renewable resources which would likely increase the cost to provide these resources

• Reduced flexibility could severely reduce quantity of balancing reserves that could be provided by the hydro system.

• With the addition of a large wind fleet the need for balancing reserves has increased

• With the spill proposal, new resources likely would be needed to provide balancing services for both existing and future variable renewable resources which would likely increase the cost to provide these resources

• Reduced flexibility could severely reduce quantity of balancing reserves that could be provided by the hydro system.

• With the addition of a large wind fleet the need for balancing reserves has increased

• With the spill proposal, new resources likely would be needed to provide balancing services for both existing and future variable renewable resources which would likely increase the cost to provide these resources

• Reduced intertie transfer capacity

• Increased congestion on North of John Day and North of Hanford transmission paths

• Would be a significant change from current operating paradigm and may cause operating issues that we do not currently face

The ISAB report was issued today. See CBB story:

"Increasing Salmon Spill At Columbia/Snake Dams; Science Panel Lists Biological Risks To Aquatic Life" www.cbbulletin.com/429790.aspx

The spill experimental proposal says: "Under recent operations and configuration of the Federal Columbia River Power System (FCRPS), smolt-to-adult return rates (SARs) have averaged 0.9 percent for wild spring-summer chinook salmon from the Snake River, well below the Northwest Power and Conservation Council (NPCC) average SAR goal of 4 percent (Tuomikoski et al. 2012)."

Those goals are outlined in the Council's current program, which was approved in 2009.

"In addition, Snake River wild spring-summer chinook salmon have achieved the NPCC minimum SAR goal of 2 percent in only two years out of the seventeen years that have been monitored. Similarly, SARs have averaged 1.6 percent and achieved the 2 percent minimum in only seven of thirteen years for wild steelhead from the Snake River.

"These results indicate that recent operations and configuration of the FCRPS have been insufficient to achieve the regional SAR goals defined by the NPCC," the Oregon proposal says. "As a result, nearly all populations that constitute the Snake River Evolutionarily Significant Units (ESUs) remain at high risk of extinction."

Related Pages:
Increasing Spill at Columbia/Snake Dams: Science Panel Lists Biological Risks to Aquatic Life by Staff, Columbia Basin Bulletin, 2/21/14
Scientists say Oregon's Spill Proposal Not Ready for Prime Time by Bill Rudolph, NW Fishletter, 2/20/14