USDA to PG&E: Mitigation is Required for Potter Valley Decommissioning
Agency says it is intervening "in the public interest"
The U.S. Department of Agriculture says Pacific Gas & Electric must fund extensive mitigation measures before federal regulators consider approving the decommissioning of the Potter Valley Hydroelectric Project, warning that dam removal would otherwise leave Northern California communities without adequate water, wildfire protection, or viable agricultural alternatives.
In formal comments filed with the Federal Energy Regulatory Commission, USDA said PG&E’s plan lacks enforceable mitigation for the loss of Lake Pillsbury and the associated Potter Valley Irrigation District diversion. The department urged regulators to reject the surrender application unless specific, binding requirements are imposed.
PG&E provided MendoLocal.News a statement in response to a request for comment. The utility says it expects to see multiple intervenors in the surrender process, and that USDA is among them. The full statement has been published in the public comment section.
Congressman Jared Huffman, who has championed a “two-basin solution” to address concerns surrounding the project’s decommissioning, was not available for comment.
USDA Mitigation Requirements
USDA said PG&E must identify and construct off-channel water storage or equivalent infrastructure to replace Lake Pillsbury as a firefighting resource, calling the utility’s fire-risk analysis incomplete and insufficient. The agency also said road systems must be improved and properly maintained to ensure safe egress and ingress for emergency responders and residents during wildfires.
The agency further demanded detailed land-management plans to stabilize the exposed lakebed and streambanks of Lake Pillsbury and its tributaries, prevent landslides, restore riparian habitat and protect National Forest grazing allotments. General references to future “restoration,” USDA said, are inadequate without site-specific, enforceable plans.
Groundwater impacts must also be addressed, the agency said, warning that draining the Lake Pillsbury reservoir would likely lower water tables and threaten wells relied upon by fire stations, ranchers and wetlands. PG&E must analyze surface- and groundwater interactions and propose concrete mitigation, including replacement or deepening of affected wells, the comments stated.
USDA also called for mitigation to replace lost recreational opportunities, including maintaining water availability for campgrounds and day-use areas on Forest Service lands.
In support of its intervention, USDA cited FERC regulation 18 CFR 6.2, which requires a licensee to restore lands to a condition satisfactory to the supervising department.
Impact on the National Forest System
The agency said decommissioning would cause direct and indirect harm to National Forest System lands under its oversight. USDA demanded that PG&E complete a comprehensive analysis of affected resources, evaluate impacts to wildfire suppression in the wildland-urban interface, and resolve outstanding issues related to the project’s land trust conservation easement.
Impact on the Natural Resources Conversation Service
USDA also said the project’s removal would undermine the mission of the Natural Resources Conservation Service (NRCS), which supports farmers, ranchers, and forest landowners through conservation investments in working lands. NRCS currently has $100.2 million invested in the affected area in Lake, Sonoma, Mendocino, Mann and Humboldt Counties, according to USDA.
Impact on Insurance and Rural Development Loans
The department further warned that decommissioning would affect crop insurance policies that require access to irrigation. “Removing access to irrigation will increase the cost to protect farmers from the inherent risk of farming,” USDA said noting that $559.9 million in agricultural products are currently insured in the affected counties.
Finally, USDA asserted that decommissioning would jeopardize $317 million in federal loans tied to 980 projects, including business programs, community facilities, rural electric systems, housing, and water and environmental infrastructure. “Without a plan to mitigate loan repayments, accepting the surrender application could leave hundreds of projects and tens of millions of dollars in default,” wrote Tucker Stewart, a USDA senior advisor.
“Unless and until PG&E addresses the aforementioned issues included in these comments,” Stewart concluded, “the Department respectfully requests that the Commission reject PG&E’s application to surrender its FERC license for Potter Valley Project dam because of the profoundly negative and irreversible impact on local farmers, ranchers, agricultural producers, communities, and USDA equities.”