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Yakamas to Move Forward with Dam Challenge by Bert Caldwell The Spokesman Review - January 3, 2002

Tribe says it is in it for long haul despite partner's withdrawal

The Yakama Nation will pursue a long-shot bid for the license to operate two Columbia River dams despite a decision by its partner to pull out.

Ted Strong, a consultant to the tribe, said the Yakamas will not be deterred by PacifiCorp's signing of a power supply contact with Grant County Public Utility District.

The tribe and Portland-based utility in October had co-founded the Yakima Hydroelectric Project LLC, which was challenging the PUD's right to the Wanapum and Priest Rapids dams.

Those projects, with a combined generating capacity of 2,000 megawatts, are the largest licensed by the Federal Energy Regulatory Commission.

The PUD, which built the dams in the 1950s, must renew its license to operate the dams by 2005.

No incumbent has ever lost a license. But the Yakama Hydroelectric was considered formidable because it combined the resources of the Northwest's largest utility and one of its largest tribes.

A Dec. 21 ruling in King County Superior Court undermined the challenge by upholding the PUD's right to penalize utilities that did not sign new contracts by Jan. 1, said Todd Freeman, who led PacifiCorp's relicensing effort.

He said the contracts include a clause that prohibits signers from competing for the dam license.

PacifiCorp, which now receives 16 percent of the power from Wanapum and Priest Rapids, could not afford to risk its right to that inexpensive power in the future, Freeman said.

And, in the meantime, the PUD had sweetened its contract offer, with an estimated $50 million break for PacifiCorp, he said.

PacifiCorp spokesman Dave Kvamme said the Yakamas were kept informed of developments after the surprising Dec. 21 ruling in a case the utility had believed it would win.

Besides PacifiCorp, Avista Utilities, Kootenai Electric Cooperative Inc. and Northern Lights Inc. also signed contracts with the PUD.

Strong said the Yakamas are already looking for new partners and new financing for the license challenge, which could add $20 million to the $5 million spent just to file an Initial Consultation Document that formally notified FERC of the competing license application.

Terms of a financial settlement between PacifiCorp and the tribe related to the utility's withdrawal from the partnership will not be disclosed, he said.

Strong said other tribes with financial resources greater than those of the Yakamas will be sought out as new partners, as will other utilities.

"We will have demonstrated ability to run hydroelectric projects available to us," said Strong, who added that the Yakamas had benefitted greatly from the process of preparing the consultation document, which will remain the foundation of its application.

"We're in this for the long haul," he said.