The Nevada Irrigation District is negotiating to acquire and operate the Deer Creek Powerhouse along with a 19-mile stretch of canals and flumes currently owned by Pacific Gas & Electric, officials said.
“This would mean the acquisition of one of the largest canals in the state,” Dave Carter, a spokesman with NID, said Wednesday.
South Yuba and Chalk Bluff Canals, which were constructed in the early part of the 20th century, consist of a 11.5-mile ditch, a 6-mile long flume and a mile-long tunnel. The canals and powerhouse fulfill the dual purpose of delivering water to residents while producing hydroelectricity.
Officials with NID, including General Manager Rem Scherzinger, met in closed session during their regular Wednesday meeting to discuss details regarding the acquisition from PG&E, which currently maintains the property, Carter said.
“We are currently exploring all our options and we can confirm NID has an interest,” said Brandi Ehlers, a PG&E spokeswoman.
The negotiations have been ongoing since 2012.
NID operates seven power plants as part of the Yuba-Bear Project, which generates about 82 megawatts of electricity, capable of supplying power to the equivalent of 60,000 houses.
The Deer Creek Powerhouse is capable of generating 5.7 megawatts of energy. If added to the portfolio, Deer Creek would be the fourth largest NID power plant, behind Chicago Park (39 megawatts), Dutch Flat (24.5 megawatts) and Rollins (12 megawatts) power plants.
NID generates power at its seven plants and sells it to PG&E, which distributes the power into its extensive grid and sells it to individual customers, Carter said.
While NID and the private utility provider operate in tandem, plans are being contemplated to turn much of the hydroelectric operations over to NID, which means more responsibility and risk in the short-term, but could generate significant amounts of revenue to defray costs of water infrastructure maintenance, Carter said.
The entire deal stands to benefit ratepayers and water users, Carter said.
If NID assumes the mantle of more electricity production and operation, some hiring could occur in the short-term, Carter said.
Concurrent with the PG&E negotiations, NID continues its attempt to finalize the Federal Energy Regulatory Commission relicensing process.
In 1963, NID was granted a 50-year operating license by the federal agency, which is set to expire this year.
For the past several years, NID has engaged in a complex relicensing process, which involves several different organizations from public, private and nonprofit sectors.
In a recent interview, Tom Quinn, Tahoe National Forest Supervisor, said he has been involved in negotiations “since day one,” as many of the reservoirs NID uses for water storage are located within forest service jurisdiction. The forest service is advocating for recreational enhancements to many of the reservoirs, Carter said.
Similarly, Gary Reedy, river science director for the South Yuba River Citizens League, said in a recent interview that he has been involved in the relicensing process, attempting to ensure that river flows, which are regulated by the FERC license, are adequately promoting vital fish habitat.
Carter said, private companies such as PG&E and Sierra Pacific Industries are also involved in the negotiations.
“It’s been a totally collaborative process,” Carter said.
Carter said the most likely immediate outcome of negotiations is FERC will provide NID with an annual license to operate under current conditions while the details of a more permanent long-term agreement are worked out.
Many of the dams and water-delivery systems that characterize the Sierra foothills region were built in the 1960s and given 50-year operating agreements by FERC, meaning many water agencies in Northern California are going through similar processes concurrently, Carter said.
FERC has indicated it will not renew agreements for another 50-year period, preferring to renew licenses more often, Carter said.
To contact Staff Writer Matthew Renda, email firstname.lastname@example.org or 530-477-4239.