Klamath Dam Owner Courted by Buffett
By John Driscoll , Eureka Times-Standard
May 25, 2005

Smack in the middle of a complicated licensing process, Klamath River hydropower operator PacifiCorp is being bought out by a Warren Buffett company.

While some worry that the swap in ownership could affect the tone of the proceedings, PacifiCorp itself said Tuesday that there will be no change.

The utility is owned by ScottishPower, a publicly held company that bills itself as environmentally conscious. Buffett's MidAmerican Energy Holdings Co. is buying PacifiCorp, which serves customers in Northern California, Oregon, Wyoming, Washington, Utah and Idaho, for $9.4 million. Regulatory proceedings on the sale are expected to last as long as a year.

PacifiCorp serves 1.6 million people with its coal, hydro, gas and wind power facilities. Its Klamath hydroelectric project produces about 151 megawatts -- enough to power about 77,500 homes. MidAmerican is controlled by Buffett's Berkshire Hathaway Inc.

But the four dams on the river also block salmon from hundreds of miles of potential spawning habitat, and its reservoirs become fetid and algae-choked in the summer, as the main run of salmon is pushing upstream.

Its license to operate the project is up in March 2006. The Federal Energy Regulatory Commission is reviewing the project while parallel settlement talks among tribes, environmentalists and other stakeholders proceed apace.

PacifiCorp spokesman Jon Coney said the company hopes to have a settlement agreement to present to federal regulators as early as the end of the year. Stakeholders are meeting this week in Redding to continue hashing out issues toward that end.

"I don't see there being a change in approach at all," Coney said about MidAmerican's pending purchase. "This is PacifiCorp's relicensing project."

Should a settlement not be reached by March, and FERC has yet to make a decision, PacifiCorp would revert to a yearly license process.

Tribes visited Scotland last year to bend the ear of ScottishPower, which was receptive to their concerns. The tribes have been especially adamant that removal of the dams be closely examined as part of the process.

In April, a $1 billion lawsuit filed by the Klamath Indian tribes was dismissed by a federal magistrate judge. The tribes have filed objections in federal district court.

Dave Hillemeier, senior biologist for the Yurok Tribe, just learned about the possible acquisition. He said the news was so fresh that tribal officials hadn't met about whether to pursue plans to visit Scotland again later this year.

"One thing it hasn't changed is our resolve to get the dams out of the Klamath River to restore the fisheries," Hillemeier said.

The technical complexities are huge and more and more people are asking for a seat in the confidential settlement talks.

The Northcoast Environmental Center's Executive Director Tim McKay described the talks as positive so far. While concerned about the pending transfer to MidAmerican, McKay said it may also offer a different means to a good end.

"It really doesn't matter who owns it," McKay said. "The dams still gotta go."

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