1998 Council Briefing Book, document 98-10

1998 Council Briefing Book

May 1998 | document 98-10

The briefing book provides information on the history of the Council and issues the Council currently is addressing.

Administrative Issues

FINANCE AND ADMINISTRATION

Central Office Staff

COUNCIL CENTRAL OFFICE STAFF FLOW CHART
COUNCIL CENTRAL OFFICE STAFF DIRECTORY

1998 SUPPLEMENT ON CURRENT COUNCIL ISSUES
A brief review of major tasks the Council is undertaking
May 1998

Fish and Wildlife Issues

1. Future Role of Fish Hatcheries

The Issue: The region lacks a coordinated policy to guide future operation of fish hatcheries in the Columbia River Basin. At the request of Congress, the Northwest Power Planning Council convened a panel of scientists and an advisory committee to review all fish hatchery production in the Columbia River Basin as a first step toward developing such a policy.

Timeline: The review should be completed and delivered to Congress by June 1999.

Background: Fish hatcheries have a long history in the Columbia River Basin. For more than 100 years, hatcheries have been used to produce fish for harvest, primarily in commercial fisheries in the lower Columbia River. For the last 60 years, hatcheries also have been used to mitigate the impact of federal dams on salmon and steelhead. Because most of this fish production, and commercial fishing occurred downstream of Bonneville Dam, many people believe the less-abundant wild salmon and steelhead that spawn upriver were disproportionately affected. Hatcheries, regardless of where they are located, also occasionally experience disease problems, and these diseases can be passed to other fish if the diseased fish are released.

On the other hand, proponents of artificial production say it may be the only way to rebuild seriously depleted stocks of salmon and steelhead that spawn in the wild. With care, hatcheries could provide the seed stocks to rebuild naturally spawning runs. This practice, known as supplementation, involves raising fish at hatcheries and then releasing them into streams where they will return, by natural instinct, to spawn.

Last September, the Northwest Power Planning Council called for a comprehensive review of artificial production of fish in the Columbia River Basin. Earlier in the year, Congress called for a similar review as a first step toward developing a coordinated policy to guide future operation of federally funded hatcheries in the basin, and two recent independent scientific reviews of fish and wildlife restoration in the Columbia River Basin have done so, as well. The common concern in each case was whether current hatchery practices and the level of production - about 80 percent of the Basin's fish are produced in hatcheries - are appropriate.

The Council's review, which will be conducted by five independent scientists and monitored by a broad-based, 25-member advisory committee, will address three major questions:

1. How does artificial production fit, or might it be altered to fit, into the Columbia Basin ecosystem?

2. How can artificial production be used to meet the needs of society for sustainable populations of fish that support harvest, as well as other competing resources?

3. What institutional structures are needed to meet the needs of society for sustainable populations of fish that support harvest?

Five scientists have been appointed by the Council to conduct the hatchery review. Three are members of the Independent Scientific Advisory Board, a panel of scientists who advise the Council and the National Marine Fisheries Service. They are Jim Lichatowich, a consulting fisheries biologist from Sequim, Washington; Rick Williams, a consulting geneticist from Meridian, Idaho; and Brian Riddell of Nanaimo, British Columbia, a fisheries biologist with the Department of Fisheries and Oceans, the Canadian federal fisheries agency. The two other scientists are Ken Currens, a biologist with the Northwest Indian Fisheries Commission in Olympia, Washington, and Ernie Brannon, a biologist with the University of Idaho.

2. Review of Corps of Engineers capital construction projects

The Issue: What fish passage improvements should the Corps of Engineers pursue in the future at dams on the lower Snake and Columbia rivers?

Timeline: The review is scheduled to be completed early in 1999.

Background: In the Conference Report accompanying the Energy and Water Development Appropriations Act for Fiscal Year 1998, Congress directed the Northwest Power Planning Council to review "the major fish mitigation capital construction activities proposed for implementation at the federal dams in the Columbia River Basin." By definition, then, this is a review of the U.S. Army Corps of Engineers' Columbia River Fish Mitigation Program. Through this program, the Corps improves fish passage at its Columbia and Snake River dams. Fish passage devices include screens to keep juvenile salmon and steelhead from being drawn into the turbines, bypass systems to carry juvenile fish around the dams, collection devices to direct juvenile fish into barges or back into the river on the downstream side of the dams, fish ladders to help adult fish swim over the dams, and related equipment. The conference report notes that the Corps' program appears to reflect multiple, sometimes conflicting strategies. For example, why should the Corps spend tens of millions of dollars to repair aging facilities at Ice Harbor Dam if there is a possibility the dam will be breached, along with the other lower Snake River federal dams, to improve migration conditions for endangered Snake River salmon?

Congress did not ask the Council to resolve such conflicts, but to point them out for further review. The Council also will identify policy and technical questions that should be addressed. The Council will address policy questions, and scientific or technical questions will be submitted to the Independent Scientific Advisory Board, an 11-member panel of independent scientists who advise both the Council and the National Marine Fisheries Service.

The Council's review will focus primarily on fish passage improvements proposed for implementation, rather than on those already under way or in the research phase. However, the Council also will review three particularly controversial projects that already are moving ahead. These are:

Relocating the bypass outlet pipe at Bonneville Dam.
Installing extended-length screens in front of the turbine entrances at John Day Dam.
Further development and testing of the surface spill bypass system at Lower Granite Dam.

3. Audit of Bonneville's Fish and Wildlife Contracting Procedures

The Issue: A 1996 amendment to the Northwest Power Act requires improved cost-effectiveness and accountability for fish and wildlife spending in the Columbia River Basin. In response, the Council retained Moss Adams LLP, an independent accounting firm, to conduct a management review of contracting processes for implementing the Council's Columbia River Basin Fish and Wildlife Program. In February 1998, after seven months of work, Moss Adams reported that the contracting process needs more competition, streamlined project procurement and improved accountability.

Timeline: The Council, Bonneville and the region's Indian tribes and fish and wildlife agencies will meet with Moss Adams to discuss how to implement the recommendations.

Background: The audit came on the heels of a Council-sponsored review of Bonneville's other costs. That review recommended $147 million in annual savings at the agency.

Most of the findings and recommendations of the management review address Bonneville's fish and wildlife project procurement and contract administration. Specifically, the review made recommendations in four areas: contract procurement, contract administration, program planning and, monitoring and evaluation. Highlights of the recommendations include:

? Increase competition in solicitation and negotiation of contracts and make the procurement process more efficient through more comprehensive program planning.
? Require additional reporting and documentation to ensure accountability for contract modifications, budgets and schedules, project status and project monitoring.
? Planning documents should be more specific about project scoping, cost definition and prioritization. Providing more specificity during planning would allow project solicitations to be more focused.
? Ensure that monitoring and evaluation play a larger role in annual planning so procurement can be guided by project results. Give one entity responsibility for monitoring and evaluation.

4. Fiscal Year 1999 Fish and Wildlife Project Selection

The Issue: Determining how to spend $127 million of Bonneville ratepayer money on fish and wildlife restoration to implement the Council's Columbia River Basin Fish and Wildlife Program in Fiscal Year 1999.

Background: Each September, the Northwest Power Planning Council recommends projects to Bonneville for funding in the coming fiscal year. The project selection process takes most of the year and includes project review and prioritization by the Columbia Basin Fish and Wildlife Authority, an association of the region's state, tribal and federal fish and wildlife agencies; review of the prioritized projects by independent panels of scientists and economists; and review by the public and the Council.

Timeline: Schedule for Fiscal Year 1999 Project Selection Process:

January 23, 1998: Project proposals due to Bonneville; projects compiled for regional review and distributed.

April 22: Columbia Basin Fish and Wildlife Authority reviews ongoing and proposed projects and drafts a work plan for independent scientific review.

June 15 (or sooner): Independent Scientific Review Panel begins review of individual projects and reports on the Basin Authority's draft work plan for Fiscal Year 1999 by June 30.

June 16 - September 1: Public review and comment

September 15: Council recommends projects to Bonneville for funding in Fiscal Year 1999.

October 1: Fiscal year begins. 5. A New Scientific Foundation for the Fish and Wildlife Program

The Issue: Fish and wildlife recovery efforts in the Columbia River Basin lack an underlying, unifying scientific foundation. The Council is taking steps to develop one.

Timeline:

February 24-25, 1998: Meeting in Boise, the Council reviewed draft scientific principles developed by the Council's staff. The principles will be reviewed by a five-person technical group representing state, tribal and federal fish and wildlife managers, and by the Independent Scientific Advisory Board, an 11-member panel that advises both the Council and the National Marine Fisheries Service.

March 17-18, 1998: Meeting in Spokane, the Council reviewed the final draft of the scientific principles.

April 7-8, 1998: Meeting in Portland, the Council approved the final draft of the scientific principles, but the document was not released for public comment pending consultation with Columbia Basin Indian tribes.

Background: The Council is developing steps to change the nature of its Columbia River Basin Fish and Wildlife Program from a set of individual measures to an overarching framework to guide annual implementation decisions. The framework ultimately will be a set of goals, objectives and strategies to guide fish and wildlife recovery in the Columbia River Basin. It is called a framework because its goals, objectives and strategies are interconnected: goals lead to objectives, objectives lead to strategies, and strategies are implemented in the annual fish and wildlife project selection process.

Before the Council can set goals, objectives and strategies through amendments to the fish and wildlife program, it first must develop a set of draft scientific principles that explain our understanding of the interactions among fish and wildlife and the world they inhabit. Scientific principles, described as physical and biological laws and assumptions, will help the Council use the program amendment process to determine which goals are reasonable and which strategies are most likely to achieve them. By stating the scientific principles explicitly, the Council will help the region refine them through program amendments and, over time, through experience.

Because the principles will help shape all the other elements of the framework that will be developed in program amendments - the goals, objectives and strategies - the Council is focusing on the scientific principles first.

Examples of possible draft principles are:

Ecosystem conditions are controlled by physical and biological factors, some of which are influenced by human activities;
Watersheds are the basic ecological units;
Genetic diversity contributes to persistence and productivity of species.

Power Issues

1. Northwest Energy Review Transition Board

The issue: In 1996, a 20-member committee appointed by the governors of Idaho, Montana, Oregon and Washington reviewed the Pacific Northwest electricity system and made a number of recommendations for how the region could take advantage of increasing electricity industry competition as the result of deregulation and also preserve the benefits of the region's mostly federal hydropower system. Following the conclusion of the Comprehensive Review of the Northwest Energy System, the governors appointed the four-member Northwest Energy Review Transition Board to carry forward the recommendations of the review in the form of draft legislation - a "Northwest Chapter" for federal energy deregulation legislation.

Timeline: The Transition Board appointed subcommittees to work on certain recommendations of the Comprehensive Review, including separating Bonneville's transmission from its generation, and federal hydropower subscription for the next rate case period (2002-2006). The Transition Board intends to complete work on the Northwest Chapter and submit it to the governors by July 1, 1998.

Background: Among the Comprehensive Review Steering Committee's recommendations:
? Bonneville would sell power by subscription. Subscribers would contract to purchase power from the system, at cost, for the periods of their subscriptions. They would be able to buy power at cost, regardless of whether that cost is above or below market prices.
? All electricity customers should be able to choose an electricity supplier by July 1, 1999.
? An independent electricity transmission system operator should be established to ensure reliable service and equitable access to transmission.
? Utilities voluntarily should support local conservation, renewable energy and low-income energy assistance programs, and state legislatures should mandate support if the voluntary effort fails. Regionwide, this funding should be approximately $210 million per year. Utility access to the energy marketplace should be linked to funding for these public purposes.
? Local utilities should retain control over local energy decisions.
? The region should continue to honor its obligation to restore salmon and steelhead runs that have been affected by the hydropower dams.

2. Bonneville Cost Review: Cut Annual Spending By $147 Million

The Issue: Deregulation of the nation's electricity industry is driving down the cost of power. In order to attract customers after 2001, when 90 percent of its power sales contracts expire, the Bonneville Power Administration needs to cut its costs in order to reduce the price of its power. At the request of Congress, the Council and Bonneville convened a committee that included five experts in corporate management to review Bonneville's costs and recommend ways to reduce them. The committee recommended cuts that should yield approximately $147 million in annual savings during the next five-year Bonneville rate period, beginning in 2001.

Timeline: The committee submitted its final recommendations to Bonneville and members of the Northwest congressional delegation on March 9, 1998. Implementation of the recommendations will be Bonneville's responsibility.

Background: The Bonneville cost review grew out of the 1996 Comprehensive Review of the Northwest Energy System, a year-long effort initiated by the governors of Idaho, Montana, Oregon and Washington. In that review, a 20-member committee recommended ways the Northwest could take advantage of increasing electricity industry competition and also retain the benefits of the federal Columbia River power system. One key recommendation was to market Bonneville's power long-term to regional customers.

Following the Comprehensive Review, the governors asked the Power Planning Council to work with Bonneville to appoint a cost-review committee. The work began last June. The committee included four Council members, two representatives from Bonneville and five experts in corporate management and finance.

The committee's recommendations include:

Washington Nuclear Plant 2: Cut the cost of the plant's power from about 2.4 cents kilowatt hour to 1.9 cents by the year 2000 (estimated annual savings: $19 million), and shut it down if it can't compete.
Energy conservation and renewable energy: Reduce conservation funding and staff, and make no long-term commitments to renewable energy projects beyond those currently planned. Estimated annual savings: $3.3 million.
Power system cost management: Initiate a cost management strategy involving Bonneville, the Corps of Engineers and Bureau of Reclamation, which operate the federal dams. Estimated savings: $48 million (Corps, $40 million, Bureau, $8 million).
Shrink the marketing department: 1) Reduce Bonneville staff and expenses associated with power marketing and related activities. Estimated annual savings: $14.7 million.
Cut overhead costs: 1) Reduce corporate overhead costs by 50 percent in areas including business services, planning, public affairs and legal services (estimated annual savings: $32 million); 2) Pursue law changes to improve administrative effectiveness and efficiency (estimated annual savings: $10 million). Northwest Power Planning Council: Reduce staff to reflect a changed power planning role, change law to require one Council member from each state instead of two. Estimated annual savings: $1.7 million.
Transmission: 1) Change certain cost allocations between the transmission and power marketing business lines. Estimated annual savings: $30 million to the Power Business Line. 2) Reduce internal overhead costs. Estimated annual savings: $2.5 million.
Fixed costs: Further reduce nonfederal debt service through such actions as bond refinancing. Estimated savings: $20 million.

3. Assessing Bonneville's Possible Stranded Costs

The issue: At the request of the Council's four-member Power Committee, the staff conducted a reconnaissance-level analysis of Bonneville's potential stranded costs, which could result if electricity market prices are lower than the price of Bonneville's power. It is important to estimate future market prices with confidence, as this will help the region resolve the contentious issue of developing a stranded-cost mechanism for Bonneville. The initial results indicate that while breaching the four lower Snake River dams and John Day Dam on the Columbia would have a significant impact on power capability in the Northwest, there would be no significant impact on West Coast market prices for electricity. It is important to emphasize that this was only a preliminary analysis and that further work is necessary before any conclusions can be drawn.

Timeline: The staff hopes to conclude its analysis and report to the Council by mid-April 1998.

Background: The Council staff's analysis to date indicates that Bonneville's potential transition costs are very dependent on market prices. The Council's previous analyses were based on 1996 analysis done for Bonneville by the consulting firm of Putnam, Hayes and Bartlett and more-or-less ad hoc variations on that forecast. Market forecasts need to be updated to reflect the latest information regarding load forecasts, gas price forecasts, generation technologies, the possible effects of the California restructuring and so on.

To accomplish this, the Council leased a computer program known as Aurora, a market-fundamentals model. Aurora simulates the operation and expansion of generating resources in the power system represented by the Western Systems Coordinating Council (WSCC). The model incorporates the logic and data for economic expansion and retirement of generating capacity, as well as for retirement or reduction in capability of generating units - as in the breaching of four lower Snake River dams or the retirement of California nuclear plants. The model can estimate market prices in various scenarios.

Because river conditions vary, affecting hydropower generation and therefore Bonneville's revenues, this uncertainty needs to be reflected in the model. It is possible for Bonneville to have no stranded costs under average water conditions while experiencing an unacceptably large number of periods in which it cannot recover its costs as a result of water conditions. The model also needs to incorporate the best possible estimate of river operations changes that might be implemented, and also their costs and time schedules for implementation. Power system costs and impacts from these river operations also need to be estimated and reflected in the model.

Reflecting these and other components, the analysis produced by Aurora should be useful in decision-making about the future of the region's power system.

HISTORY OF THE REGIONAL POWER SYSTEM

The development of the Columbia River system in the Pacific Northwest began in the 1930s under a program of regional cooperation to meet the needs of electric power production, land reclamation, flood control, navigation, recreation and other river uses.

From the beginning, the federal government has played a major role in the development of one of the largest multiple-use river systems in the world. Thirty multi-purpose dams on the Columbia River and its tributaries were built by the U.S. Army Corps of Engineers and the Bureau of Reclamation. Investor-owned and publicly owned utilities also built a major system of dams and generating facilities. Congress directed the Bonneville Power Administration, in the Bonneville Project Act of 1937, to build and operate transmission lines to deliver the power from dams, and to market electricity from federal generating projects on the river at rates set only high enough to repay the federal investment over a reasonable period of time.

Canadian Treaty

As demand for power grew, the United States and Canadian governments recognized a need for development of water storage sites in the upper reaches of the Columbia River Basin. The governments of both nations negotiated a treaty in the early 1960s for the cooperative use of dams that would be built by both countries. Four treaty dams were built. Three are on the Columbia River in Canada - Hugh Keenleyside, Duncan and Mica - and the fourth, Libby, is on a major Columbia tributary, the Kootenai River, in Montana. The Canadian dams were completed by 1973, and Libby was completed in 1975. These dams provide flood control and additional power generation at dams downstream in the United States. The power-generating capability of downstream dams increased by the following percentages as a result of the treaty storage: Grand Coulee, 13 percent; Chief Joseph, 14 percent; the five mid-Columbia public utility district dams, 18 percent; and dams farther downstream on the Columbia, 11 percent collectively. In return, Canada received a cash settlement for its share of the additional power generation. The value of this power, known as the downstream benefit, recently was renegotiated by the two countries.

Intertie

Also in the 1960s, Congress authorized the construction of three major power lines linking the Columbia River hydro projects with power markets in California and the rest of the Pacific Southwest. The interties benefit the Pacific Northwest in several ways. They allow the sale of hydropower from the Columbia when it is not needed here and would otherwise be lost in the form of water spilled over dams without generating electricity, and they permit this region to buy power from California when power is needed here during shortages and periods of heavy use. In the first instance, sales of surplus Northwest hydropower to California has saved the equivalent of some 200 million barrels of oil. In the second case, California utilities sold power to Pacific Northwest utilities in the drought years of 1973, 1977, 1979, 1992, 1993 and 1994.

To protect Northwest access to power, Congress passed regional preference provisions in 1964. Bonneville must offer any surplus power to utilities in the Northwest before selling it to California. Sales to California can be called back if the power is needed in the Northwest. Sales of firm energy can be recalled with 60 days notice, sales of peaking capacity can be recalled in five years.

Net Billing Agreements

With the dams developed in Canada as well as the United States, the river system provided virtually all the electricity needed by the region until the early 1970s. But by that time, all dam sites on the mainstem of the Columbia that were economically feasible and environmentally acceptable were either developed or under development, and the region was looking for other ways to meet electric load growth. Bonneville and the region's utilities were predicting shortages of electricity unless thermal generating plants were brought on line in response to increasing demand.

The region's publicly owned utilities and investor-owned utilities turned mainly to coal-fired and nuclear plants to meet growth throughout the Pacific Northwest. Utilities believed the development of such plants was the most economic and environmentally acceptable option available at the time. Bonneville helped the utilities respond to these needs by participating in a Hydro-Thermal Power Plan for the continued development of electricity resources in the Pacific Northwest.

Under the plan, Bonneville agreed to acquire electricity by entering into "net billing" agreements with its publicly owned utility customers. These agreements made it possible for the publicly owned utilities, which owned shares of power plants, to sell to Bonneville all or part of the generating capacity of thermal projects. Bonneville credited, and continues to credit, the wholesale power bills of these utilities in amounts sufficient to cover the costs of their shares in these plants. Bonneville then sells the output of these plants, melding the higher costs of this thermal power with the lower costs of hydropower, for the benefit of all customers. The plants were cooperative efforts of both publicly owned and investor-owned utilities, but Bonneville purchased only the shares of generating capacity owned by publicly owned utilities.

Hydro-Thermal Power Program

Under the Hydro-Thermal Power Program (Phase I), Pacific Power & Light Company and other investor-owned utilities built the Centralia coal-fired plant with the co-ownership of several publicly owned utilities. Portland General Electric Company built the Trojan nuclear power plant, with 30 percent co-ownership by Eugene Water and Electric Board (EWEB) covered by a net-billing agreement. And the Washington Public Power Supply System (WPPSS), under net-billing agreements, completed one nuclear plant (WNP 2) and partially constructed two other nuclear plants (WNP 1 and 3) in Washington state. The Hanford N-reactor turbine generator, built by WPPSS, also came on line just prior to the formal initiation of the Hydro-Thermal Power Program, and before its closure in 1987 was considered a part of the overall effort. Bonneville became the agent for integrating these resources so the consumers of the region could benefit from the greatest efficiency and lowest costs from operation of the regional electric system. The thermal power plants, which run continuously, would meet the base, or constant, power needs. The hydroelectric dams would be operated to follow the fluctuation of energy needs throughout the day.

In spite of the efforts of utilities and Bonneville to continue developing the region's generating resources in a systematic way, the region continued to lose ground to rapidly growing demands for electricity. The Hydro-Thermal Program failed to meet the region's expectations for two basic reasons. A revision of regulations by the Internal Revenue Service denied tax exempt status to bonds sold by publicly owned utilities to finance their plants if power from the facilities was sold to Bonneville, a Federal body. And, Bonneville's financial ability to participate in net-billing agreements reached its limits far sooner than expected because of the climbing costs of new thermal plants.

In 1973, Bonneville and the region's utilities initiated a Hydro-Thermal Program, Phase II, in which the utilities would finance their own plants without net-billing participation by Bonneville. Thus, WPPSS nuclear units 4 and 5, now terminated, were not covered by net-billing contracts. Nonetheless, Bonneville expected to provide electric load management and power integration services and to supply peaking power and reserves from federal facilities in order to bring about the most efficient mix of resources possible. Bonneville's participation in this program was enjoined by a federal court, which required that Bonneville complete an environmental impact statement on its role in the region.

The environmental impact statement found that fluctuation in the use of hydroelectric dams would have to be limited to protect shore structures along the river. In addition, delays in the construction of new plants, costs higher than originally expected, and the realization that the Hydro-Thermal Program would not be adequate to meet needs made it evident that Bonneville would not be able to sell firm power to investor-owned utilities and still provide first priority to serving "preference customers" as directed by federal law.

Preference

The Bonneville Project Act of 1937 directed that the co-ops and publicly owned utilities of the region be given first call on available federal resources. They consequently came to be called "preference customers." Until the 1970s, their legal preference had never been exercised because there had been enough electricity for everyone. In 1973, when Bonneville's firm-power contracts with investor-owned utilities expired, Bonneville could not offer new ones if preference customers were to continue to have first call on federal resources. So the firm power contracts with the investor-owned utilities were not renewed.

However, Bonneville continues to sell some peaking power to the investor-owned utilities - power they need to get through periods of heavy use in the winter heating season. Bonneville also sold "non-firm" power to the investor-owned utilities and utilities outside the region when electricity surplus to the needs of the preference customers is available.

In 1976, Bonneville's power demand and supply projections showed that federal power supplies were running short for preference customers, and that Bonneville would no longer be able to guarantee preference customers that their load growth could be met beyond 1983. Bonneville issued a notice of insufficiency to the utilities in June of 1976.

Rate Disparities

With the investor-owned utilities relying on their own hydro and thermal resources to meet the demand of their customers, and with the prices of federal hydropower much lower than that of new thermal generation, a divisive struggle for access to limited federal resources grew. Sixty percent of the residential and farm customers of the region are served by investor-owned utilities. These customers were paying, on average, twice as much for electricity as customers of publicly owned utilities receiving wholesale power from Bonneville. The City of Portland sued Bonneville, claiming a right to a share of hydropower resources for its citizens. The State of Oregon passed a law authorizing formation of a statewide public utility - the Domestic and Rural Power Authority - to seek service as a preference customer from Bonneville so that all residential customers of private utilities could receive the rate benefits of Federal resources. Elected officials of other states talked of forming their own statewide public utilities.

Stimulated by rate disparities, the public power movement also experienced a renaissance. A strong public power move to buy out investor-owned utility service areas by means of elections in accordance with State law was revived in Oregon. All votes to form new PUDs failed in the November 1980 elections, but one long inactive PUD, the Columbia Peoples Utility District west of Portland won voter approval for issuing bonds to buy out utility properties in Columbia County.

Meanwhile, planning for more resources to meet demand was hamstrung by uncertainty over the allocation of low-cost federal power among competing claimants, existing and new. For example, Bonneville's contracts with its direct service industries, which are large industrial firms that purchase power directly from Bonneville, were to expire in the 1980s. The power sold to these industries would have to be sold to public utilities under the preference clause. If they were to survive in the Northwest, these industries needed an assured source of electricity.

Declining salmon runs

Finally, by the late 1970s it became clear that our regional prosperity, which resulted in large measure from inexpensive hydropower from the federal dams, had extracted a price on fish and wildlife in the Columbia River Basin. Just a century earlier, for example, between 10 million and 16 million salmon returned to the Columbia each year. But by the late 1970s, there were only about 2.5 million salmon, and most of those returned to hatcheries. Environmental groups and other advocates for fish and wildlife considered filing petitions to protect dwindling fish populations under the federal Endangered Species Act.

These pressures on our regional electric power supply, which once seemed inexhaustible, caused Pacific Northwest residents to question the institutions governing the development, sale, and distribution of generating resources. Should new preference agencies be formed to replace private companies in given areas? How would the supply needs of new preference customers be met? Should private utilities undertake new generating projects in a hostile atmosphere of rapidly rising rates and the threatened shift to public power? How would large industrial customers in the region be served? How should the public, and their elected representatives, participate in decisions that were critical to the region's economy and environment? Who ultimately would be responsible for planning and acquiring new resources to avoid impending electricity shortages? How would our region protect the fish and wildlife that had been damaged over the years by the construction and operation of hydropower dams?

The region continued to work for a cooperative solution that preserved local options while obtaining regional efficiencies of an integrated electric system. Several alternatives were explored, but no agreement was reached. To avoid a court battle over allocation issues, the region turned to Congress for a solution.

Toward a Congressional Solution

Revisions to the Bonneville Project Act were considered as early as 1975. The legislation was prompted by Bonneville's Notice of Insufficiency in June 1976, coupled with the threat posed by Oregon's Domestic and Rural Power Authority. However, it was not until 1977 that Bonneville and its customers, through the Pacific Northwest Utilities Conference Committee (PNUCC), drafted legislation to solve the region's energy problems. Senator Jackson introduced the PNUCC bill in September of 1977, but neither that bill, nor a less complex successor drafted a year later, managed to progress very far by the time the 95th Congress adjourned in late 1978.

When the 96th Congress convened in 1979, a coalition of Bonneville customers was solidly behind a legislative solution to the Northwest's power crisis. Neither Bonneville nor its customers wanted an administrative allocation of limited power supplies, although Bonneville did propose an allocation scheme in October of 1979. Bonneville and its customers, however, maintained that such an allocation would be subjected to protracted litigation. They alleged that Congress could avoid the uncertainties accompanying administrative allocation by devising a legislative allocation scheme and equipping Bonneville with the authority to purchase power from non-federal sources on a long term basis. Supplying Bonneville with purchase authority was, they claimed, the key to implementing any legislative allocation scheme. Congress apparently agreed. The Senate passed the regional legislation on August 3, 1979; the House passed an amended bill on November 17, 1980, which the Senate agreed to two days later. On December 5, 1980, President Carter signed the Pacific Northwest Electric Power Planning and Conservation Act into law as Public Law 96-501.

Northwest Power Act - Major Provisions

After four years of deliberation, Congress devised methods for protecting the preference that existing federal law gives publicly owned utilities, while at the same time providing the benefits of federal hydropower to residential and small farm customers of private utilities. It should be noted that the Act passed largely because it seemed to benefit all the interest groups that lobbied for it.

Here are some highlights of the Act: First, rate disparities between consumers served by private utilities and those served by public utilities were minimized by providing investor-owned utilities access to Bonneville's lower-cost power. Second, the costs of this increased access were paid for by increased rates charged to industrial customers. Third, in return for paying increased rates, existing industrial customers were promised new long term contracts. Fourth, preference customers were guaranteed that their rates would not increase more than they would have without the Act.

Fifth, Bonneville was given purchase authority to expand the system in order to meet the requirements of its customers, but only pursuant to a number of provisions designed to guard against any abuse of that authority. In particular, in response to state claims of a lack of involvement in major regional energy issues, the Act created a unique interstate planning entity, the Pacific Northwest Electric Power and Conservation Planning Council, to govern Bonneville's acquisition of major resources and promote conservation and renewable resources programs through a regional energy plan. This was the key provision from the perspective of the Northwest states - Bonneville got new authority to acquire resources in return for a Council appointed by the governors. This Council would develop a regional plan and oversee its implementation.

Sixth, in an effort to minimize rate increases, the Act requires that all acquisitions be "cost-effective," including consideration of environmental costs, and establishes a resource priority scheme favoring conservation and renewable resources over thermal plants. Seventh, Columbia Basin fish and wildlife damaged by the hydroelectric system are to be preserved and restored through a basin-wide program promulgated by the Council.

Finally, the Act guarantees public involvement in all significant resource decisions.

The Act directs that Bonneville should continue its traditional role of transmitting and marketing power, but also carry out additional responsibilities. Under the Act, Bonneville must acquire all necessary energy resources to serve utilities who choose to apply to Bonneville for wholesale power supplies. The Act contains checks and balances to insure that all customers of Bonneville are treated equitably.

Bonneville remains accountable to the people of the Pacific Northwest for the actions it takes to meet the needs of residents and industry. By creating a regional planning council consisting of two members from each of the four Northwest states to develop a regional plan, Congress provided a regional decision-making system. It emphasizes local control of resource development and power planning.

Here are the major provisions of the Pacific Northwest Electric Power Planning and Conservation Act:

The Northwest Power Planning Council was formed with representation from each of the states. The Act directed the Council to draw up a plan for meeting the electrical needs of the region at the lowest possible cost. The plan must give highest priority to cost-effective conservation, treating it as a resource preferable to all other means of responding to demand for electricity. Renewable sources of energy must be given next highest priority in the region's power planning, to the extent that they are cost-effective ranking ahead of conventional thermal generating resources. Among thermal options, fuel-efficient methods of producing energy, such as cogeneration, must be given priority.
Bonneville became responsible for meeting loads of customers and managing the regional electrical system to achieve the purposes of the Act relating to fish, system efficiency, and experimental projects. The plan adopted by the Council, which is amended periodically, is the basis for Bonneville's actions in meeting loads of its customers. Congress exercises budget review of all proposed Bonneville expenditures. If Bonneville decides to acquire resources not consistent with the Council's plan, specific Congressional approval is required prior to any commitment by Bonneville. Bonneville must give priority to cost-effective conservation and renewable resources in meeting the region's needs. Bonneville may also purchase the generating capabilities of new thermal projects, but only after determination that they are required in addition to all cost-effective conservation and renewables that can be achieved or developed in time. Such projects must also be found reliable and compatible with the regional electric system. Bonneville must spread the benefits and the costs of resources among all of its customers through its rates.
The supply preference and resulting price advantage to co-ops and publicly owned utilities by Federal law was protected and enhanced. Bonneville was given the responsibility of meeting the full future requirements of preference customers - something Bonneville was not previously authorized to do.
Residential and farm customers of investor-owned utilities received rate relief. The utilities sell to Bonneville, at the average cost of their power, an amount of electric energy equal to their residential and farm loads. Bonneville sells to them, in return, enough energy at Bonneville standard rates to cover these residential and farm loads. The rate advantages cannot enhance company profits, but must be passed on directly to the customers.
Direct service industries received new 20-year contracts for power from Bonneville, but at a higher price than they paid under previous contracts. In effect, they pay the cost of rate relief to residential and small farm customers of investor-owned utilities during the first four years, and a substantial portion thereafter, which they agreed to do in exchange for assurances of long-term supplies.
Bonneville sells electricity at a rate that reflects the melded cost of Federal hydropower and more expensive thermal resources, conservation, and renewable sources of energy. The Act contains incentives, as well, to encourage conservation and renewables. Bonneville may credit utilities for their individual actions to implement conservation and renewables.
The Council established a program to protect and enhance the fisheries resources of the Columbia River and to mitigate damage already done to anadromous fish. Funding for the program is to come from Bonneville rate revenue.
All planning for electric resources and fish protection must involve the public. State and local control of land use and water rights is protected under the Act and the decision to allow construction of new resources is left with utilities and state siting authorities.
The Council must provide a method for balancing environmental protection and the energy needs of the region. For each new energy resource, the provisions of the National Environmental Policy Act must be complied with.
The Council is required to seek the recommendations of the region's tribal, state and federal fish and wildlife agencies. In addition, the Council's measures must be consistent with the legal rights of the region's tribes.

Challenges for the Future

The electricity industry in the United States is in the midst of significant restructuring. This restructuring is the product of many factors, including national policy to promote a competitive electricity generation market and state initiatives in California, New York, New England, Wisconsin and elsewhere to open retail electricity markets to competition. This transformation is moving the industry away from the regulated monopoly structure of the past 75 years. Today we are served by individual utilities, many of which control everything from the power plant to the delivery of power to our homes or businesses. In the future, we may have a choice among power suppliers that deliver their product over transmission and distribution systems that are operated independently as common carriers.

There is much to be gained in this transition. Electricity consumers are already benefiting from competition in a number of significant ways. Competition in the natural gas industry has helped lower the cost of electricity produced by gas-fired generating plants. Competition among manufacturers and developers of combustion turbines has contributed to the availability of less expensive, more efficient power plants that can be built relatively quickly. Surplus generating capacity on the West Coast, combined with increasing competition among wholesale suppliers, has reduced the price utilities must pay for power on the open market. Broad competition in the electricity industry that extends to all consumers could result in lower prices and more choices about the sources, variety and quality of their electrical service.

But, there are risks inherent in the transition to more competitive electricity services. Merely declaring that a market should become competitive will not necessarily achieve the full benefits of competition or ensure that they will be broadly shared. It is entirely possible to have deregulation without true competition. Similarly, the reliability of our power supply could be compromised if care is not taken to ensure that competitive pressures do not override the incentives for reliable operation. How competition is structured is important.

It is also important to recognize the limitations of competition. Competitive markets respond to consumer demands, but they do not necessarily accomplish other important public policy objectives. The Northwest has a long tradition of energy policies that support environmental protection, energy-efficiency, renewable resources, affordable services to rural and low-income consumers, and fish and wildlife restoration. These public policy objectives remain important and relevant. Given the enormous economic and environmental implications of energy, these public policy objectives need to be incorporated in the rules and structures of a competitive energy market.

In some respects, the transition to a competitive electricity industry is more complicated in the Northwest because of the presence of the federal Bonneville Power Administration. Bonneville is a major factor in the region's power industry, supplying, on average, 40 percent of the power sold in the region and controlling more than half the region's high-voltage transmission. Bonneville benefits from the fact that it markets most of the region's low-cost hydroelectric power. It is hampered by the fact that it has high fixed costs, including the cost of past investments in nuclear power and the majority of the costs for salmon recovery. As a wholesale power supplier, Bonneville is already fully exposed to competition and is struggling to reduce its costs so that it can compete in the market. The transition to a competitive electricity industry raises many issues for the Bonneville Power Administration and the region. In the near term, how can Bonneville continue to meet its financial and environmental obligations in the face of intense competitive pressure? In the longer term, when market prices rise and some of Bonneville's debt obligations have been retired, how can the Northwest retain the economic benefits of its low-cost hydroelectric power when the rest of the country is paying market prices? And finally, what is the appropriate role of a federal agency in a competitive market? The question is not only whether Bonneville can compete in the near term, but also, should it be a competitor?

The federal power system in the Pacific Northwest has conferred significant benefits on the region for more than 50 years. The availability of inexpensive electricity at cost has supported strong economic growth and helped provide for other uses of the Columbia River, such as irrigation, flood control and navigation. The renewable and non-polluting hydropower system has helped maintain a high quality environment in the region.

But while the power system has produced significant benefits, these benefits came at a substantial cost to the fish and wildlife resources of the Columbia River Basin. Salmon and steelhead populations have been reduced to historic lows, and many runs are or are about to be listed under the federal Endangered Species Act. Resident fish and wildlife populations have also been affected. Native Americans and fishery-dependent communities, businesses and recreationists have suffered substantial losses due in significant part to construction and operation of the power system. The region's ability to sustain its core industries, support conservation and renewable resources, and restore salmon runs is clearly threatened if we cannot reach a consensus regional position to bring to the national electricity restructuring debate. Without a sustainable and financially healthy power system, funding for fish and wildlife restoration could be jeopardized.

In 1996, the governors of Idaho, Montana, Oregon and Washington initiated a comprehensive review of the region's energy system. This review is discussed in more detail later in this briefing book.

THE COLUMBIA RIVER BASIN FISH AND WILDLIFE PROGRAM

The Northwest Power Act requires the Council to review its power plan and the Columbia River Basin Fish and Wildlife Program at least every five years. The last review led to a revision of the fish and wildlife program, which the Council approved in December 1994.

The 1994 program revisions incorporated more rigorous protections for salmon and steelhead, particularly those Snake River salmon runs that have been listed under the federal Endangered Species Act (Snake River spring/summer chinook, fall chinook and sockeye). The 1994 salmon and steelhead amendments responded to a commitment the Council made in the previous revision of the salmon and steelhead chapters of the program, the 1992 Strategy for Salmon. The Strategy included a number of immediate measures to boost salmon survival, but the Council recognized that those measures alone would not be enough to rebuild the runs. So the Council called for investigation of additional, longer-term measures and further consideration in 1994. Some of those longer-term measures were included in the December 1994 amendments.

By approving the amendments, the Council also responded to a ruling by the Ninth Circuit Court of Appeals. In September 1994, the Court remanded the Strategy to the Council in response to lawsuits that challenged various measures in the program. The Court held that the Council needed to do a better job explaining how its program protected fish and, in doing so, should give greater deference to the region's fish agencies and Indian tribes in designing the program. Many of the amendments approved in December were based on recommendations of the agencies and tribes.

Important goals in the Strategy were preserved in the 1994 amendments. For example, the goal of doubling adult salmon populations in the Columbia Basin remains, as does protection for existing biodiversity, including both anadromous and non-anadromous fish populations. The amendments also reaffirmed the Strategy's ambitious rebuilding targets for the listed Snake River salmon species. These targets are: 1) 50,000 spring chinook; 2) 20,000 summer chinook; and 3) 1,000 fall chinook crossing Lower Granite Dam in southeastern Washington. In each run, the target is for adult naturally spawning salmon.

Here are four key directives in the Council's fish and wildlife program regarding anadromous fish:

Improve migration survival

To reach these targets, the program calls for actions at every stage in the salmon's life cycle. Because salmon are killed in large numbers as they attempt to migrate through reservoirs and past hydropower dams, the strategy calls for higher flows and increased river speed, systems to keep salmon smolts from going through turbines, new ways to operate the dams so they kill fewer salmon, controls on predators that eat salmon, and improved barge transportation of salmon to carry them past the dams. The Council's program embraces a philosophy known as "spread-the-risk," which means leaving juvenile salmon and steelhead in the rivers to migrate naturally when river conditions are good (high flows, cool water), and transporting the juvenile fish in barges and trucks when river conditions are poor (low flows, warm water).

Reduce harvest

Because so many Columbia River Basin chinook, particularly those from the Snake River Basin, are caught in both the ocean and in the lower Columbia river, the program calls for more effective control of those harvests.

Protect and improve habitat

Because more than a third of all the salmon habitat in the region has been blocked by dams and more has been degraded by numerous human activities, the program emphasizes habitat repairs that will increase the productivity of anadromous fish in the wild.

Improve hatcheries

Because fish hatcheries can play an important supporting role in rebuilding salmon runs, the program calls for improvements and consistency in hatchery management practices. Here are some key measures the Council amended into the program in 1994:

Continue hatchery reforms and improvements.
As part of updating the subbasin plans, agencies and tribes will propose supplementation projects to help rebuild naturally spawning salmon populations.
Initiate emergency supplementation of Snake River fall chinook; prepare for emergency supplementation of spring and summer chinook.
Evaluate tributary, mainstem (including reservoirs), estuary, plume, near-shore ocean and marine salmon survival, ecology, carrying capacity and limiting factors.
The Bonneville Power Administration should fund the design of an impact assessment to examine the effects of Columbia River Basin hatcheries (individually and collectively) on wild and naturally spawning fish.
Fishery managers should consult with appropriate genetics specialists and develop basinwide guidelines to minimize genetic and ecological impacts of hatchery fish on wild and naturally spawning stocks.

FISH AND WILDLIFE PROGRAM COSTS AND RESULTS

Introduction

Rebuilding fish and wildlife populations won't be easy, quick or inexpensive. Fish and wildlife activities funded by Pacific Northwest ratepayers include Council program and non-program measures. Non-program measures are activities funded by Bonneville that were initiated prior to the adoption of the fish and wildlife program. These include ladders and screens that were installed at the Corps of Engineers mainstem dams and the 22 production facilities built under the Lower Snake River Compensation Program. Provisions in the Northwest Power Act addressing fish and wildlife were included in large part because Congress judged the non-program activities to be inadequate to reverse the declines of salmon and steelhead runs that had extended into the late 1970s.

This section of the Briefing Book explains how much money is available for the Council's fish and wildlife program, where it comes from, and how decisions are made to spend it.

Where the money comes from

Most of the money to pay for fish and wildlife recovery under the Council's program comes from Bonneville Power Administration ratepayers. Some of the money comes from the federal government in the budgets of federal agencies, particularly the U.S. Army Corps of Engineers, and is repaid by Bonneville.

The Council believes that because the fish and wildlife program is a regional effort to rebuild weak salmon stocks, it is appropriate that state and federal entities and others participate in funding. All levels of government must bear responsibility for adequately funding and staffing fish and wildlife rebuilding measures, or run the almost certain risk that the recovery effort will be delayed, with potentially disastrous results.

1996 fish and wildlife budget memorandum of agreement

There are three significant categories of fish and wildlife costs that affect the Bonneville Power Administration's rates. These are project costs, Bonneville's repayment obligations to the U.S. Treasury for improvements at the dams, and foregone hydropower revenues.

Project costs include Bonneville funding of hatchery construction, habitat projects, research and other fish and wildlife initiatives in the Council's program. Under a September 1996 memorandum of agreement between Congress, Bonneville, the Council and Columbia River Basin Indian tribes, the budget for these projects averages $127 million per year through 2001.

Bonneville repays the U.S. Treasury for most of the costs of passage facilities at the Columbia and Snake river federal dams. These are the original fish ladders, the screens and bypass systems whose installation at the dams began in the 1980s, and the juvenile salmon transportation facilities. The annual payment for these existing facilities is set in the 1996 memorandum of agreement at $125 million per year through 2001.

When the Council adopts measures to change river operations to provide improved flows for salmon, Bonneville may not be able to make as much money from power sales. In many winters, Bonneville must buy power from other suppliers to allow the reservoirs to store water for spring and summer salmon flow releases. Spill and lowered mainstem reservoir levels also reduce the ability of individual dams to generate electricity. In 1984, the Council adopted its first "water budget," and in 1989, adopted a spill agreement. The 1992 Strategy for Salmon boosted the water budget volume and added about $45 million in average annual revenue impacts to Bonneville. The amount of foregone revenue will vary year to year, depending on water supplies. In years when storage and runoff are plentiful, foregone revenue will be low. In below-average water years, forgone revenues will be high. Based on an average of 50 water years, the memorandum of agreement estimates that foregone revenues will average $183 million per year.

Thus, the cost of the Council's fish and wildlife program in an average water year is $435 million - $127 million in projects, $125 million in repayments and other fixed obligations, and $183 million in foregone revenues.

The memorandum of agreement also dealt with the issue of whether electricity ratepayers should bear the entire cost of fish and wildlife recovery measures. Section 4(h)(8)(B) of the Northwest Power Act says consumers of electricity will pay the cost of measures designed to deal with adverse impacts caused by the development and operation of electric power facilities. Yet construction of the dams of the Federal Columbia River Power System was authorized by Congress for multiple purposes - including hydropower. Accordingly, Section 4(h)(10)(C) of the Act allows the Bonneville administrator to allocate the costs of fish and wildlife recovery among the various purposes of the dams - irrigation, navigation, etc., in addition to hydropower. While Bonneville has financed the entire amount of the Council's program to date, the memorandum of agreement recognizes Section 4(h)(10)(C) and assigns a value to the impact of these other purposes - about $350 million. This amount is available to Bonneville as a credit against future Treasury payments, if needed.

Annual prioritization of projects in the Council's program for funding by Bonneville

In order to increase public scrutiny of the allocation of fish and wildlife resources within the constrained fish and wildlife budget, in 1995 the Council initiated an ambitious process of prioritizing projects for funding. In this process, the fish and wildlife managers recommend funding priorities to implement the Council's fish and wildlife program. After reviewing and prioritizing projects, the managers submit their recommendations to the Council. The Council analyzes the recommendations, conducts public hearings and consultations, invites written comments as well, and then submits final recommendations to Bonneville in three broad areas: anadromous fish, resident (non-ocean going) fish and wildlife. The Council approves the projects, not their cost. That is a matter for Bonneville to negotiate with contractors.

We have been working each year since 1995 to improve the process. For example, at the Council's direction, projects considered for funding in Fiscal Year 1997 included much more detailed information than was available to the fish and wildlife managers in 1996. Managers now are able to consider anticipated project costs for the coming five years, projected results, milestones and citations of available project reports, and peer-reviewed scientific literature pertaining to the projects. We improved public review, as well, incorporating an analysis of public comments received on the managers' recommendations. The managers have the opportunity to respond to the comments and recommend revisions before the Council makes its final recommendations to Bonneville.

The Independent Scientific Review Panel

In 1996, Congress amended the Northwest Power Act with a new section, 4(h)(10)(D), which provides for independent scientific review of the projects in the Council's fish and wildlife program that are directly funded by Bonneville - the annual $127 million established in the memorandum of agreement. This amendment authorized the Council to recommend projects to Bonneville for funding. Prior to the amendment, this role was not explicitly sanctioned in the Act.

Section 4(h)(10)(D) directs the Council to appoint an 11-member Independent Scientific Review Panel (ISRP) "to review projects proposed to be funded through that portion of the Bonneville Power Administration's annual fish and wildlife budget that implements the Council's fish and wildlife program." The Council also is directed to appoint Scientific Peer Review Groups "to assist the Panel in making its recommendations to the Council." The Council is to select the peer review groups from scientists nominated by the National Academy of Sciences, "provided that Pacific Northwest scientists with expertise in Columbia River anadromous and non-anadromous fish and wildlife and ocean experts shall be among those represented."

The peer review groups, "in conjunction with the Panel," are to review projects proposed for funding through Bonneville's annual fish and wildlife budget and make recommendations to the Council no later than June 15th of each year. The Panel and the review groups need not review every project, but a "sufficient number of projects to adequately ensure that the list of prioritized projects recommended is consistent with the Council's program." Recommendations of the panel and the peer review groups are to be based on a "determination that projects: are based on sound science principles; benefit fish and wildlife and have a clearly defined objective and outcome with provisions for monitoring and evaluation of results." The Panel and review groups are also to review annually "the results of prior year expenditures based upon these criteria," and to submit its findings to the Council.

The Panel's recommendations to the Council must be made available to the public for review and comment. The Council makes final recommendations to Bonneville "after consideration of the recommendations of the Panel and other appropriate entities." The Council also must "consider the impact of ocean conditions" in making its recommendations, and "determine whether the projects employ cost effective measures to achieve program objectives." The Council must explain in writing if it decides not to incorporate a recommendation of the Panel. The amendment directs Bonneville to pay the expenses of the Panel and peer review groups, at a cost not to exceed $2 million. The amendment's provisions expire on September 30, 2000. The Council appointed the 11 members of the ISRP in January 1997, and members of the peer review groups in April.

Independent Economic Analysis Board

Cost-effectiveness is an important consideration for projects in the Council's fish and wildlife program, but until Congress amended the Northwest Power Act in 1996 with Section 4(h)(10)(D), which added a cost-effectiveness component, there was no specific direction in the Act to employ a cost-effectiveness test. Prior to the amendment, the Act directed the Council, at Section 4(h)(6)(C), to consider cost-effectiveness only in the event that two proposed measures have "... equally effective alternative means of achieving the same sound biological objective" but different costs. In that event, the Council is directed to "utilize ... the alternative with the minimum economic cost." Elsewhere in the Act, the Council is directed to design the program to deal with the river and its tributaries as a system, in recognition of the "... unique history, problems, and opportunities presented by the development and operation of hydroelectric facilities on the Columbia River and its tributaries." Some have argued this means the Council cannot include measures in the program that would upset the operation of the power system by making it, for example, uneconomical.

To help sort through difficult economic issues, in January 1997 the Council formed the Independent Economic Analysis Board. The Board is a panel of eight economists, chosen from more than 70 applicants, whose expertise will improve cost analysis of fish and wildlife recovery measures. The panel will conduct annual reviews of measures proposed for funding by Bonneville through the Council's fish and wildlife program. The panel also will offer economic advice on other fish, wildlife and energy issues, as the Council requests.

Conclusion

The Council has a thorough process in place to analyze fish and wildlife expenditures annually, ensure public and scientific review and comment on projects before they are recommended for funding, analyze appropriate economic issues as they arise, and monitor and evaluate results of the program expenditures. While the process is daunting and the expense is substantial, the Council believes the cost of inaction potentially is higher.

Without effective restoration measures, the region stands to lose wild salmon stocks whose genetic resources may be critical to the long-term sustainability of the Snake and Columbia river runs. Without an effective regional program, a federally administered Endangered Species Act process on behalf of salmon, resident fish or wildlife could impose substantially more onerous costs on irrigators, electric utilities, navigators, fishing communities and others who use the Columbia River and its resources. While the Council has not sought to put a dollar value on this outcome, no one should mistake the value of a determined, long-term regional fish and wildlife recovery program.

SYSTEM PLANNING

In 1987, the Council established an interim goal to increase Columbia River salmon and steelhead runs by 2.5 million adult fish. Achieving this goal would double the runs over the 1977-1981 average levels. Doing so requires careful consideration of production opportunities, mainstem passage conditions and harvest. In short, it requires the development of a systemwide plan addressing the complete life cycle of salmon and steelhead with care to avoid undermining genetic resources.

System planning was initiated in September 1987, when the Council contracted with the fisheries agencies and tribes to prepare the plans. In June 1991, this effort resulted in an overall, basinwide plan composed of individual salmon and steelhead production plans for 31 geographic areas of the Columbia River Basin. These geographic areas are termed "subbasins" for the planning process, and each is composed of a major tributary or portion of the mainstem Columbia or Snake rivers.

System planning was pursued in an open, public process by subbasin planners, system-level planners and senior staff from interested entities. For each subbasin, a group of local technical experts was assembled to do subbasin-level planning. These planners wrote the plans and gathered input from affected entities to ensure that the plans considered needs of local areas. Technical planners at the system or overall basin level were organized in two groups - the Monitoring and Evaluation Group and the System Planning Group. The System Planning Group provided overall direction to the subbasin-level planners and wrote the system-level reports that provided this direction. The Monitoring and Evaluation Group was composed of experts in technical analysis of salmon and steelhead life history. It provided the analysis that was used to determine whether actions planned for individual subbasins were consistent among all subbasin plans and with activities that occur outside the subbasins, such as mainstem passage and ocean and mainstem harvest.

In the 1992 amendments to the fish and wildlife program, the Council acknowledged that the subbasin plans, along with other resource management plans, will be the starting point for identifying actions to help specific salmon populations. Plans developed under the program, and otherwise, will be used to address other fish and wildlife species.

The Council called on fishery managers and Bonneville to form subregional teams to assist in implementation of fish and wildlife measures in the following subregions of the Columbia River Basin:

* Below Bonneville Dam
* Bonneville Dam to Snake River
* Snake River to Chief Joseph Dam
* Above Chief Joseph Dam
* Snake River from the mouth to Hells Canyon Dam
* Above Hells Canyon Dam

The Council said these teams should use the Integrated System Plan, subbasin plans, other fish and wildlife plans and any other available relevant plans and information to prepare recommendations for the annual implementation work plan and program monitoring report. Each team will be responsible for identifying any conflicts with other resource management plans in the relevant subregion, along with options for resolving these conflicts. Guidelines for these recommendations are listed in Section 3.1D.1, Page 3-5, of the 1994 program (document 94-2).

Another aspect of system planning, coordination of watershed activities in subbasins of the Snake and Columbia (model watersheds), is discussed in Section 7.7 of the 1994 program, beginning on page 7-31 of document 94-2).

RESEARCH

Many uncertainties remain about the biology of Columbia River Basin salmon and steelhead and how best to protect, mitigate and enhance them. To address the major uncertainties and in an effort to end research fragmentation, the program established six areas of research emphasis for Bonneville funding: 1) solving disease problems affecting spring and summer chinook; 2) improving the effectiveness of hatcheries; 3) improving techniques for supplementation (introduction of artificially produced fish into streams); 4) studying water budget effectiveness and reservoir mortality; 5) improving bypass systems; and, 6) improving transportation of juvenile fish past the mainstem Snake and Columbia dams. The last two are areas of research funded by the Corps of Engineers.

These six research areas are believed to hold the most promise for helping to achieve the doubling goal, and a sizable portion of program expenditures supports this research. In the 1992 program amendments, the Council called on Bonneville and the Corps to publish a summary of results from all studies funded under the program and to conduct annual symposiums at which contractors present the results of their studies, beginning in March 1993. The Council also called on Bonneville to continue funding the development of the Coordinated Information System to promote effective exchange and dissemination of information in the standardized, electronic format throughout the Columbia Basin. This system, now in place, is operated by the Pacific States Marine Fisheries Commission and is known as Streamnet.

Disease

Fish disease research focuses on combating three major disease problems of cultured fish: bacterial kidney disease (BKD), a major killer of spring and summer chinook; infectious hematopoietic necrosis (IHN), which primarily affects steelhead; and fungal infections, which may debilitate and kill all species. All the top-priority activities in the fish disease work plan have been initiated. Future research will refine our ability to fight BKD, IHN and fungal infections and to investigate additional disease problems.

Hatchery Effectiveness

Hatchery effectiveness research focuses on improving the production and survival of fish at existing hatcheries. This research is aimed at identifying the rearing and release conditions and other elements of hatchery production that yield highest fish survival rates.

In the 1992 program amendments, the Council concluded that regional standards and procedures for hatchery operations should be developed that are consistent with the goal of rebuilding weak wild naturally spawning stocks. To help develop tools to reduce the impacts of hatchery production on wild and naturally spawning stocks, the Council convened a group of nationally recognized geneticists. These geneticists were asked to bring the best current scientific knowledge to salmon and steelhead production issues. A number of products have resulted from this effort and are being reviewed at the technical and policy levels in the region.

The Council also called on fishery managers to create the Integrated Hatchery Operations Team to develop regionally integrated hatchery policies regarding fish health, genetics, ecological interactions and hatchery performance standards. This work largely was completed, and in 1997 the Council voted to assign any uncompleted tasks to the congressionally mandated review of artificial production in the Columbia River Basin. This review is being undertaken by the Council with the assistance of the Independent Scientific Advisory Board.

Supplementation

Supplementation research is aimed at developing improved techniques to use hatchery production to rebuild natural runs, and at identifying impacts of supplementation on native stocks. In 1988, the Council stipulated that this research should take advantage of ongoing or planned supplementation activities, such as those under the Lower Snake River Compensation Plan. An analysis of the successes and failures of past and ongoing supplementation was conducted by the Council's Regional Assessment of Supplementation Project (RASP), which was created in 1990 to provide a comprehensive framework for supplementation. The project was carried out by technical representatives from the fishery managers, utilities, Bonneville, the Council an others. One of its products was a recommended planning process.

Three supplementation research projects were initiated in 1989. These are 10- to 20-year projects. In the 1992 amendments, the Council called on fishery managers to use existing processes, including RASP and the Integrated System Plan to prepare evaluations, including biological risk assessments, for proposed supplementation experiments that were submitted by the Columbia River Inter-Tribal Fish Commission. Supplementation research hatcheries operated by Indian tribes in the basin are discussed elsewhere in this briefing book.

Reservoir Mortality/Water Budget Effectiveness

In its 1987 fish and wildlife program, the Council called for research into reservoir mortality and water budget effectiveness. However, a technical research work group was unable to agree on a single consensus work plan. Therefore, research in this area has proceeded on a year-to-year basis and has been devoted largely to studying predation of young salmon and steelhead by predators such as squawfish and walleye.

Water budget effectiveness research remains controversial, but in the 1992 amendments the Council recognized that research on the relationship between spring and summer flow, water velocity and fish survival has had unsatisfactory progress to date, notwithstanding concerted efforts by several parties.

Accordingly, the Council agreed to fund an independent, third-party evaluation of all new and existing information and analysis on river velocity and survival of juvenile spring, summer and fall chinook and sockeye salmon. Based on this evaluation, which was completed in October 1993, the Council initiated a process to adopt program amendments stating the Council's position on the relationship between flow, velocity, travel time and survival of juvenile spring, summer and fall chinook, sockeye, and steelhead. The evaluation was conducted by Oak Ridge National Laboratories, Oak Ridge, Tennessee, and the flow-survival hypotheses were amended into the program in May 1994. These hypotheses, which were amended into the program in 1994 as Section 5.0E are considered essential starting points for scientific experimentation.

In 1992, the Council called on Bonneville to fund additional independent, third-party scientific evaluations to determine the relationship of flow and water velocity to the travel time and survival of juvenile spring, summer and fall chinook salmon. This evaluation of survival in the Lower Granite and Little Goose reservoirs is being conducted by the National Marine Fisheries Service. In the 1994 amendments, the Council called for an experiment to compare the survival of transported fish with those that migrate in the river. While this adaptive management experiment never was conducted, the Fisheries Service research continues.

Bypass

A major goal of research on juvenile bypass systems is to improve the bypass systems at Bonneville Dam, particularly at the second powerhouse. Studies evaluated juvenile survival levels through the spillway, turbines and bypass systems at Bonneville Dam. Researchers now have a better understanding of why survival levels through the bypass system at the second powerhouse are lower than expected. The Council, with the assistance of the Independent Scientific Advisory Board, is conducting a review of several controversial capital construction projects at Snake and Columbia river dams. The extended outfall at the Bonneville Second Powerhouse is one of those projects. The others are extended-length screens at the John Day Dam and continued development and testing of the surface-bypass system at Lower Granite Dam. Bypass research also is being carried out at other Corps dams.

Transportation

Transportation research is aimed at determining the benefits of juvenile fish transportation. Studies are underway to compare returns of transported and non-transported fish. A major problem is determining benefits for spring chinook, because of recent low flow years. Ongoing studies also are evaluating effects of fish condition, particularly incidence of bacterial kidney disease, on adult returns of transported and non-transported fish. Studies are in progress to assess the use of PIT (Passive Integrated Transponder) tags to evaluate transportation of wild and hatchery fish, and to develop a PIT tag deflector system that would allow tagged fish to return to the river at collector projects.

In the 1992 and 1994 amendments, the Council called on the Corps to accelerate improvements in transportation. This would include evaluation of techniques to improve transportation, such as the use of cooler water in the barges, reduced densities of fish in the barges and broader dispersion of the fish when they are released below Bonneville Dam. In the longer term, depending on the results of continuing evaluation, barging may be useful in the mix of techniques the region will employ to decrease the mortality associated with migration through the reservoirs. The Council also called on the Corps to evaluate further improvements, including improved fish holding and loading facilities, alternative fish collection sites and alternative transportation technologies.

MAINSTEM PASSAGE

The program employs a number of approaches to reduce downstream and upstream salmon and steelhead mortality at and between Columbia and Snake river hydroelectric dams. The Council's present strategy for improving downstream fish passage includes:

* Spill for fish passage at each project on an interim basis until bypass screens are installed and operational;
* Development, installation and improvement of permanent bypass systems at all mainstem dams;
* Collection and transportation of smolts around mainstem hydroelectric projects in barges and trucks;
* A water budget and phased-in reservoir drawdown strategy to augment flows and increase river velocities during the critical spring outmigration period.
* Control of predators such as squawfish.
* A number of measures to improve survival of returning adult fish.

In 1994, the Council amended the program with additional mainstem survival actions in the following areas:

* An expedited program to improved fish bypass at mainstem dams through the development and testing of surface-flow bypass systems and, until these and other bypass improvements are in place, additional spill to levels that do not exceed state-defined levels of nitrogen gas supersaturation.
* Improvements in spill efficiency and installation of structural measures to reduce high total dissolved gas at mainstem dams.
* Improved flows in the Snake River through acquisition of one million acre-feet of additional water from willing sellers and additional water from Brownlee Reservoir.
* Improved flows in the Columbia River through modified operation of Grand Coulee and Albeni Falls dams and negotiations for additional water from Canadian storage reservoirs.
* Enhanced velocity in the Snake and Columbia rivers through drawdown of Lower Granite and Little Goose reservoirs to near spillway crest level and operation of John Day reservoir at near minimum operating pool.
* Specific milestones to review the drawdown actions.
* An emphasis on inriver juvenile migration in all but the worst water conditions, along with improved fish transportation and an accelerated National Marine Fisheries Service-directed comprehensive scientific evaluation of transportation and inriver migrant survival.
* An intensified effort to control predators and reduce competition with depressed salmon stocks. Here is a look at specific actions to improve mainstem survival:

Spill

The program calls on the region's dam operators and regulators to develop and implement interim annual passage plans to protect juvenile fish until permanent screening and bypass facilities can be developed and installed at all mainstem dams. The most immediate interim solution is to spill water laden with fish through a spillway to provide a non-turbine passage route for juvenile fish migrating to the sea.

In the 1994 amendments, the Council called on dam operators to use spill water so that 80-percent of the fish do not go through the turbines at each Snake River dam from about April 15 to July 31, and at each Columbia dam from about May 1 to August 31. Spill would be limited to comply with the dissolved gas guidelines established by federal and state water quality agencies.

To reduce levels of dissolved gas that results from spilling water at the dams, the Corps installed "flip lips" at Ice Harbor and John Day dams. The installation was completed in 1998. These spillway deflectors should help reduce total dissolved gas levels below these projects by as much as 10 percent.

Screening and Bypass Facilities

The Council's fish and wildlife program calls for improving or installing systems to divert fish away from turbines and for continued spill until the screens are in place.

In the absence of reservoir drawdown, the long-term solution to protect juvenile fish involves installation of mechanical screening and bypass facilities to divert, collect and bypass fish past each of 13 powerhouses on the mainstem Columbia and Snake rivers.

The installation of juvenile fish bypass facilities varies from dam to dam in both type and effectiveness. Some mainstem dams have no screening and bypass facilities installed, while others have already been equipped with new or improved systems. Currently, bypass facilities are installed or undergoing improvements at Bonneville, John Day, McNary, Ice Harbor, Lower Monumental, Little Goose and Lower Granite dams, all operated by the Corps of Engineers, and at Wells Dam, operated by Douglas County Public Utility District. Screens are installed at all federal dams except The Dalles Dam.

The mid-Columbia public utility districts, in consultation with the region's fishery agencies and tribes through a Federal Energy Regulatory Commission settlement agreement, are in the process of developing and testing prototype screening and bypass systems and surface bypass options at the remaining four mid-Columbia dams (Priest Rapids, Wanapum, Rocky Reach and Rock Island).

The Council's top federal budget priority has been to secure needed funds to ensure that bypass systems can be installed and improved at all federal mainstem dams. Consistently, this effort has been supported unanimously by the Pacific Northwest Congressional delegation, the fisheries agencies, the utility community and other sport and commercial fishing groups.

Transportation

Smolt transportation involves the collection and movement of juvenile salmon and steelhead around hydroelectric projects on the Columbia and Snake rivers. It has been studied and implemented by the Corps of Engineers since 1968. Smolts are collected at four projects operated by the Corps: Lower Granite, Little Goose and Lower Monumental dams on the Snake River and McNary Dam on the Columbia River. Transportation also has been tested at Priest Rapids Dam on the mid-Columbia River.

Smolts are moved from the four federal collector projects in barges, although trucks are used at the beginning and end of the migrations when fish numbers are low or to supplement barge transportation during the peak of the migration. Fish are released into the river below Bonneville Dam for the remainder of their journey to the ocean. In recent years, the number of transported fish has increased dramatically. For example, the number of fish transported has increased from about 16 million in 1986 to over 20 million in the low-water year of 1988.

The Council has actively assisted the Corps in efforts to secure additional Congressional funds for the construction of improved holding and loading facilities and new fish barges. This is to ensure that adequate transportation facilities will be available when needed to accommodate increased smolt production. In recent years, fish handling and loading facilities were improved or expanded at Little Goose and McNary dams. Two additional barges were constructed in 1990, bringing the total number of available barges to six. Two more fish barges are presently under construction and scheduled to be completed by spring of 1998.

Transportation appears to work well for steelhead and fall chinook salmon. However, given the uncertain results of transporting spring chinook, the Council determined that the agencies and tribes should control whether and how many fish are transported. Typically, they support transport in low water years. In recent years, the Corps has also deferred to agency and tribal jurisdiction on the issue. A 1994 scientific peer review of transportation concluded, in part, that available evidence is not sufficient to identify transportation as either a primary or supporting method of choice for salmon recovery in the Snake River Basin.

In its 1991 and 1994 amendments to the fish and wildlife program, the Council called for accelerated improvements in transportation operations and facilities. The Council recognized that, in the near term, especially in low-water conditions, smolt barging is one of the few tools the region has to improve survival. The Council called on the Corps to evaluate techniques to improve transportation, such as the use of cooler water in the barges, transporting fewer fish, reducing densities of fish in the barges and broader dispersion of the fish when they are released below Bonneville Dam. The amendments also call for research to test the survival of fish that are transported in barges against those that migrate in the rivers. In February 1998, the ISAB submitted a review of transportation that concludes it is prudent to exercise caution in weighing the possible risks against the perceived benefits of juvenile transportation because of the "magnitude of uncertainty" of information available to assess the strategy.

Water Budget and Flow Augmentation

Juvenile salmon and steelhead have adapted over thousands of years to the Columbia River's natural runoff pattern. But the extensive development of dams and hydropower projects in the basin has greatly altered natural river flows. The historical peak spring runoff is now stored in reservoirs for use during later periods of naturally low flows. Regulating the river in this manner increases the power system's ability to generate firm energy. However, it also reduces river flows, especially during the spring when juvenile fish are migrating to the sea. The sluggish waters of the reservoirs can more than double the time it takes for a smolt to reach the ocean, thus increasing the risk of disease and predation. Higher water temperatures in the reservoirs also contribute to higher mortalities.

To address reservoir mortality, the Council developed an annual water budget. It is a volume of water composed of natural runoff and stored water held in reserve at headwater dams for use during the April 15 to June 15 spring smolt migration. The water budget was developed in response to studies conducted during the last 20 years or so that suggested higher salmon survival resulted from higher river flows. The Council contracted with the Oak Ridge National Laboratories to conduct an independent assessment of the available scientific knowledge on the relationship of river flows to salmon survival. The review concluded that despite certain data problems, the general relationship of increasing survival with increasing flow in the Columbia River basin appears to be reasonable. Studies of different stocks, using different analytical approaches, have tended to show the same general patterns.

During the spring smolt migration, water that could be used to generate electricity at other times of the year is released instead to augment flows to create an artificial spring freshet to aid fish. The Council first adopted a "water budget" in 1982 to reserve 3.45 million acre-feet of upper Columbia water during the winter, plus 1.19 million acre-feet of Snake River water, to be released in the spring when juvenile salmon are migrating. In 1992, the Council added an additional 3 million acre-feet to this storage reserve in the Columbia and identified volumes of more than 1.4 million acre-feet for spring migrants and about 900,000 acre-feet for summer and fall migrants to be reserved in the Snake system in the driest water years. These new volumes replaced the earlier 1.19 million acre-feet water budget in the Snake River and represent the maximum attainable volumes for salmon flows called for in the fish and wildlife program. In 1994, the Council added another million acre-feet for spring flows in the Columbia River and 400,000 acre-feet for summer migrants. The Council also asked that another 1.2 million acre-feet of Snake River water be obtained from Dworshak and Brownlee reservoirs and through voluntary measures from the upper Snake River Basin. These water reserves result in constraints on winter power sales and even periodic power purchases from outside the region to meet winter energy demands, as well as operating constraints on storage reservoirs.

The Council's goal is to provide a minimum monthly average flow or velocity equivalent in the Snake River of 140,000 cubic feet per second in all water years. This would be accomplished with a combination of water releases from upriver storage reservoirs and reservoir drawdowns in the lower Snake. Brownlee Reservoir on the Snake River would be operated in a manner that assists spring-migrating salmon downstream. In addition, Idaho Power Company, which owns and operates Brownlee, will make water available to ensure wild fall chinook redds (nests of eggs) downstream in Hells Canyon remain wet during the winter and spring incubation period.

Meanwhile, the Council set a sliding scale of flow-equivalent objectives for the Columbia River, measured at The Dalles Dam, for the period between April 15 and August 31 varying from 300,000 cubic feet per second during the main migration period (April 15 to June 15) to 160,000 cubic feet per second in August. This will mean increased water storage in years when low runoff is forecasted. John Day Reservoir on the Columbia would be operated at minimum irrigation pool during critical migration periods. The reservoir would be lowered to minimum operating pool as soon as irrigation systems are modified or relocated so they can operate at this lower level. The program called for the Council to decide by 1998 whether to lower the John Day reservoir farther; however, John Day drawdown is now being studied by the Corps of Engineers as part of its 1999 Snake River Feasibility Study. Flow objectives in the Snake and Columbia should be met in most years, depending on water conditions.

Actual power system operations aim to be consistent with the terms of the National Marine Fisheries Service's 1995 biological opinion for the federal power system regarding Snake River salmon and the U.S. Fish and Wildlife Service's biological opinion for Kootenai River sturgeon. The biological opinion regarding endangered Snake River salmon does not provide the same level of protection for resident fish in upriver storage reservoirs as the Council's program. The Council adopted specific "integrated rule curves" to regulate reservoir drawdowns and protect resident fish and wildlife at Hungry Horse and Libby dams in Montana. It also adopted water retention times and specific elevation levels for Grand Coulee Dam. Water retention times and reservoir elevations adopted by the Council in 1995 to protect resident fish are not met in the biological opinion. The biological opinion for Snake River salmon devotes more water from the upper Columbia to salmon flows and less from the Snake River.

The measures also called for operating John Day Dam on the Columbia and the four Lower Snake River dams at lower levels beginning in 1996. Thes---e operations will require costly modifications to the dams and mitigation of impacts to irrigators and other reservoir users. The program conditioned implementation of these operations on prior completion of the mitigation. During the spring and summer juvenile salmon and steelhead migration in 1998, the four lower Snake dams are being held at minimum operating pool and John Day at minimum irrigation pool.

Here is a brief overview of the mainstem measures in the 1994 program amendments:

Improved information:
* Intensified evaluations of improved inriver salmon migration and improved barge transportation of salmon smolts.

Bypass improvements and turbine screens at the dams:
* Accelerate tests of surface bypass systems and schedule rapid decisions on their installation.
* Spill water so that up to 80 percent of the juvenile fish that pass each dam do not go through turbines. Insure that dissolved gas limits set by Washington and Oregon are not exceeded.
* Accelerate structural changes to the dams to reduce gas supersaturation and test slotted spillway gates to improve spill efficiency.
* Relocate problematic bypass outfalls.
* Continue juvenile fish screening and bypass improvements.
* Hold final decision to construct screens at The Dalles Dam until more is learned about the benefits of surface bypass.

More water to boost salmon flows:
* Obtain from willing sellers 500,000 acre-feet in the upper Snake River Basin by the spring of 1996. Obtain up to an additional 1 million acre-feet from willing sellers by the spring of 1999. The latter proposal is being evaluated by the Corps of Engineers in its 1999 Snake River Feasibility Study. Continue to evaluate new upriver water storage dams.
* In the Columbia, provide a volume of water up to 4 million acre-feet in low water years, limited by resident fish protections (see below). * Negotiate with Canada for additional water for flows.
* Hold Lake Pend Oreille higher during winter months to provide additional water for salmon flows in the spring. Test the impact on kokanee spawning in the lake.
* Use reservoir flexibility for summer migration improvements.

River velocity improvements
The 1994 Program called for a phased drawdown strategy with Council review at each milestone date. Mitigation of adverse impacts to irrigation, navigation and other activities would have been provided. While the phased drawdown strategy was not implemented because the Corps followed the 1995-1998 Biological Opinion, here is brief overview of what the Council proposed:

In the Snake River:
* Beginning in 1995, draw down Lower Granite reservoir 28 feet (to elevation 710 feet above sea level) for about two months during the spring and early summer. At this level the adult fish ladder would still operate, but the juvenile fish bypass system would not, and barge traffic would be interrupted for the duration of the drawdown. Beginning in 1996, draw down the reservoir to near spillway level for two months - an additional 17 feet - after modification of the adult ladder exit.
* Beginning in 1999, draw down Little Goose reservoir to near spillway crest for two months in the spring - after modifications to adult and juvenile passage facilities.
* Continue to evaluate additional drawdowns and make a decision on drawing down Lower Monumental and Ice Harbor dams to near spillway crest - about 40 feet - prior to 2002.

In the Columbia River:
* Operate John Day reservoir near minimum operating pool - elevation 257, an 11-foot drawdown from full pool - by the spring of 1996. Operate at this level year-round. Barge traffic continues, but some pumps would need to be extended prior to the drawdown. This measure was not implemented, but the reservoir is being held at minimum irrigation pool during the 1998 migration season (elevation 262.5), which is five and one half feet higher than minimum operating pool (elevation 257).
* Accelerate evaluation of lowering John Day reservoir to near spillway crest - elevation 220, a 48-foot drawdown from full pool - and make a construction decision by December 1996, after evaluation of structural modifications to allow continued navigation and irrigation and impacts to flood control and power production.
* Evaluate other reservoirs for flow or velocity improvements.

Barge transportation of juvenile fish:
* Make improvements in transportation, such as additional barges, reduced fish density in barges, and dispersed release of fish.
* National Marine Fisheries Service, state fish agencies and Indian tribes determine how many fish are transported.

Upstream Passage

Hydroelectric projects present a physical barrier to adult salmon and steelhead migrating from the ocean to spawning areas upstream. To solve this problem, fishways were constructed prior to the fish and wildlife program at many of the dams in the Columbia River Basin. Flow and spill criteria also have been adopted to provide unimpeded passage and maximum attraction of the fish to the fishways.

However, not all these measures have been successful. For example, flow and spill conditions in the tailraces of some mainstem dams tend to discourage fish movement upstream or to mask the flows intended to attract fish into the fishway. In addition, inadequacies in certain fishway facilities and in their operation and maintenance reduce the success of adult fish passage at both mainstem and tributary dams. These inadequacies include failure to provide necessary attraction flows at fishway entrances; ineffective fish ladders; mechanical failures of pumps that supply fishway auxiliary water; and lack of fish counting facilities to permit effective management of adult runs.

The program includes a number of measures to improve adult passage. The program calls on the project operators to continue to implement adult fish flow, spill and fishway operating criteria and evaluate measures to improve fish passage at each project. The Corps of Engineers and the mid-Columbia public utility districts implement adult fish flow, spill and operating criteria in accordance with an annual operating plan developed in consultation with the fishery agencies and tribes. The program also calls on the Corps to correct problems created by unreliable pumps. In response, the Corps has acquired spare parts to minimize pump outages, rebuilt unreliable fish pump gearboxes, and developed annual pump maintenance plans.

In 1994, the Council called on the Corps of Engineers to implement all spill and operating criteria for mainstem adult fish passage facilities and to make needed improvements. In addition, the Council called on the Corps to leave juvenile fish screens installed for a longer period to provide protection for adult salmon that may fall back through the powerhouses.

Tributary projects to improve adult fish passage also have been approved. In addition, the program also calls for research on issues such as fish disease at adult passage facilities and the effectiveness of adult passage facilities and flow and spill criteria. The Council also calls on the Corps to investigate potential methods to reduce water temperature in mainstem fish ladders, as well as to evaluate whether releasing cold water from Dworshak Dam and Hells Canyon complex in late summer improves adult fall chinook passage and survival.

HABITAT AND PRODUCTION

Hydropower development and operation, as well as other causes, have eliminated much of the natural fish production in the Columbia River system. Reservoirs created by dams have inundated nearly all of the mainstem Columbia spawning habitat. The only free-flowing stretch of the Columbia River, in the Hanford Reach below Priest Rapids Dam, supports a sizable population of naturally spawning fall chinook. Large areas of the basin have been blocked by dams that provide no passage to spawning and rearing habitat in the areas above Chief Joseph/Grand Coulee, the Hells Canyon complex of dams and numerous tributaries. Regardless, opportunities do exist for enhancing remaining spawning and rearing areas through habitat rehabilitation, improving and increasing hatchery propagation, and providing passage around barriers that prevent fish from reaching production areas.

The program supports a three-part approach to producing more salmon and steelhead through a combination of natural production, hatchery production, and supplementation of wild and natural fish produced by releasing hatchery fish into natural habitats. To advance this effort, the Council has adopted measures to provide water flows and temperatures suitable for natural and wild propagation, improve habitat and tributary passage, increase knowledge of appropriate timing and sites for release of hatchery fish, improve existing artificial production facilities, and build new hatcheries, mostly as supplementation facilities.

Maintaining the delicate balance between naturally spawning and hatchery-produced fish will require a systematic, basinwide approach to existing and new production. But a focus solely on production will not yield success. Accordingly, the Council's program for increasing production acknowledges the need for a systemwide approach that coordinates production, harvest regulation and passage improvements.

Habitat Rehabilitation

Under the program, numerous projects were completed to improve tributary passage and repair habitat for salmon and steelhead in the Clearwater, Deschutes, Grande Ronde, John Day, Salmon, Umatilla, Wenatchee, Willamette and Yakima River subbasins. More than 2,000 miles of streams have been improved for salmon and steelhead. Typically, these projects involve fencing and replanting stream banks and restoring structure in the streams to provide cover, rearing areas and other essential elements of habitat. Another 1,000 miles of habitat have been opened to fish production by improving passage at or removing barriers.

Subregional approach

The subregional approach will be the basis for the program treatment of habitat and production issues, but it is apparent that this approach will take time to develop and implement. In the interim, many salmon and steelhead populations continue to decline. Some of these populations, such as chinook produced in the Snake River Basin, cannot wait for this approach to be implemented. They require expedited actions. Council evaluation indicates that even with improved salmon and steelhead survival through changes in mainstem operations, many populations will not be maintained, let alone rebuilt, without immediate and significant increases in survival at other stages of their lives.

Habitat improvements and changes in hatchery operations (for example, the use of supplementation) can be implemented to increase natural production and survival significantly. In the short term, options appear to be fairly limited in this area.

Yakima and Klickitat Projects

The Yakima River Basin is located east of the Cascade range in Washington where annual precipitation is very low. Irrigation has changed the Yakima River valley from a near-desert environment to one of the most productive agricultural regions in the country. Development of the Yakima River Basin for agriculture and irrigation has meant stream flows sufficient to support salmon and steelhead have been greatly reduced. Yet much of the Yakima's fish habitat remains largely intact, and fisheries experts consider this basin to be one of the areas with the best potential for producing salmon and steelhead in the Columbia River Basin.

The Yakima and Klickitat projects are a group of artificial production facilities to be used primarily for supplementing natural runs of salmon and steelhead. The Klickitat subbasin was added to the project because of its close proximity to the Yakima and opportunities for siting facilities and fish enhancement in the basin. The stocks that will be enhanced include spring, fall and summer chinook, coho salmon, summer steelhead and potentially sockeye salmon. It is estimated that some 76,000-175,000 adult salmon and steelhead could result from the project, which will be carefully monitored and evaluated. The facilities will include a central hatchery used to raise juvenile

1998 Council Briefing Book

Fish and Wildlife Issues

Power Issues

Legal Issues