Scott Dam slated for removal in plan by Sonoma County and partners to control hydropower project

A nearly century-old dam on the Eel River that impounds Lake Pillsbury is slated for removal under a $500 million proposal helmed by Sonoma County and four other regional partners seeking to take over from PG&E a remote but pivotal hydropower project in Mendocino County.

The coalition, including Mendocino and Humboldt counties, hailed the proposal as a milestone in their effort to meet the needs of all three counties, protecting water supplies for farmers, fish and communities, including a key source of supplemental water for the Russian River system that serves 600,000 ?customers in Sonoma and Marin counties.

The dam removal alone, a long-sought goal of environmental groups and fish advocates, would be the highest-profile project to improve habitat for imperiled North Coast salmon and steelhead in decades, perhaps behind only the dam removals planned on the Klamath River within the next two years.

“The good news is that Scott Dam is coming out,” said Scott Greacen, conservation director for Friends of the Eel River, a nonprofit that for decades has been pursuing removal to open up more than 300 miles of spawning habitat in the upper Eel. Due mainly to dams, water diversion and other development, the river’s salmon and steelhead “have paid a devastating price, going from a million fish a year to the brink of extinction,” he said.

The proposal, submitted Wednesday to federal officials, has also stirred passions among those dismayed by the prospective loss of a 2,300-acre recreational lake deep in the Lake County portion of Mendocino National Forest. Santa Rosa?residents George and Carol Cinquini, who have held a cabin at Lake Pillsbury since the 1940s, are annoyed that the 450 homeowners, ranchers and small business owners in the lake community were excluded from the planning process.

“We tried to get our foot in the door,” said Carol Cinquini, vice president of the Lake Pillsbury Alliance, which was formed last year.

“We’re very upset,” said George Cinquini, an alliance board member. The reservoir, about two hours from Santa Rosa is a haven for water sports, and without it, Cinquini warned, Russian River flows will be diminished in dry years.

But North Coast Rep. Jared Huffman, D-San Rafael, who brought local shareholders together to chart the project’s future, said the proposal is the only way to guarantee a “really important water resource” for the Russian River.

The 98-year-old dam has long outlived its purpose, he said, and the coalition project, dubbed the Two-Basin Partnership, calls for habitat restoration “to rejuvenate one of our great salmon rivers in California.”

State Sen. Mike McGuire, D-Healdsburg, whose district stretches across both drainages, called for Lake County to be added to the partnership because Lake Pillsbury and most of the Eel River’s headwaters are in the county.

The filing is just the first step in a complex process that involves establishing a new operator for a historic powerhouse in Potter Valley that PG&E quit seeking to relicense a year ago because its meager generating capacity was no longer economical.

The power plant generates about nine megawatts of power, accounting for about 0.1% of the utility’s 7,700 megawatt total.

The hydropower project also funnels Eel River water into the Russian River basin, bolstering supplies for cities and grape growers along the Russian’s northern reaches.

Grant Davis, the general manager of Sonoma Water, the region’s dominant supplier of drinking water for residents, called the feasibility study filed with the Federal Energy Regulatory Commission “a pathway forward that will achieve a more reliable water supply for the region while protecting and restoring two remarkable rivers.”

Initial studies have indicated capital costs for project facilities from $100 million to $400 million with an additional $30 million to $120 million for new equipment that would provide sufficient water for Potter Valley, a 7,000-acre farming region in Mendocino County that has prospered on water delivered by the project.

The cost of removing Scott Dam has been estimated at $70 ?million, and Huffman said there is no way PG&E can walk away from it without making “a major financial contribution.”

Annual operating costs would be in the $5 million to $10 million range.

Davis acknowledged the formidable costs, saying both the amounts and who pays for them - and the impact on ratepayers - will be determined by upcoming relicensing studies.

“There are a great deal of unknowns,” he said.

Part of the work to be done involves “monetizing the water supply and the energy,” Davis said.

McGuire said the partnership is working on a financial plan that will include support from PG&E, federal and state funds and water customer payments.

Janet Pauli, chairperson of the Mendocino County Inland Water and Power Commission, a coalition member, said the steep capital costs would have to be covered by outside sources, while operating costs could impact consumers’ water rates.

Pauli, a Potter Valley farmer, said Wednesday’s filing preserved a local role in determining the project’s future. Without it, the energy commission would likely have asked PG&E to embark on a decommissioning process that could take years and would have limited the decisions to the utility and the federal agency.

Greacen, with Friends of the Eel River, said he had thought state and federal grants might cover the upfront costs, but that now seems less likely with the budget-busting outlays for the coronavirus crisis. His endorsement of the proposal also was tempered by uncertainties over the cost and the makeup of a new regional entity that would operate the project in place of PG&E.

In addition to the three counties, the partnership includes California Trout, a 50-year-old environmental organization, and the Round Valley Indian Tribes, which hold Eel River water rights. CalTrout included Scott Dam on its list of “Top 5 California Dams Out” last year.

Altogether, the Potter Valley Project consists of two dams - Scott and Cape Horn Dam on the downstream Van Arsdale Reservoir - a water diversion facility and a milelong tunnel and series of pipes that deliver Eel River water to the Russian River basin via a powerhouse at the north end of Potter Valley.

Now diverting more than 20 ?billion gallons of Eel River water a year, the project turned the otherwise arid valley into an agricultural powerhouse that produces $34 million worth of wine grapes, cattle and other products a year.

Flowing from the valley into the Lake Mendocino reservoir at Ukiah, the water continues into the East Fork of the Russian River, supporting agriculture worth $743 million from Redwood Valley to the Sonoma County line and the famed vineyards of the Alexander Valley near Healdsburg.

Sonoma Water, the county water agency, depends on Lake Mendocino to maintain mandated flows for federally protected fish from the lake down to Healdsburg, where Dry Creek brings in water from Lake Sonoma, the region’s largest dam.

Since PG&E surrendered its interest in renewing the federal license to operate the project in January 2019, the partners - brought together by Huffman - have been seeking what they called a “two-basin solution” to address the needs in both the Eel and Russian river watersheds.

Finding a solution to the competing claims for the diverted water seemed daunting.

Huffman said at the time it would bring change to the system that dates back to the early 1900s.

“The status quo is unlikely to continue,” he said.

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