Managing Our Hydro Operations

License Agreement Milestones

PG&E’s hydroelectric system consists of 26 federally licensed projects. As required by federal and state regulatory agencies, PG&E evaluates and mitigates the projects’ impacts on natural resources.

More than half of our operating licenses have been, or will be, up for renewal between 2000 and 2012. The license renewal process creates an opportunity to identify and assess project-specific impacts, taking into consideration all beneficial uses, including conservation, fish and wildlife habitat protection and enhancement, recreational opportunities and power generation. We have made it a priority to work collaboratively with stakeholders, including local community members, throughout the relicensing process to identify and try to find agreement on appropriate resource management measures to include as conditions of the new licenses.

We have continued to make significant progress in improving our license compliance performance, which we measure by tracking our compliance with key environmental requirements. Using this approach, our compliance rate has improved from 95.5 percent in 2009 to 97.9 percent in 2010.

PG&E’s management of our hydroelectric operations yielded important environmental benefits in 2010.

Environmental Stewardship in Our Hydroelectric Operations—2010
Miles of stream monitored for environmental condition1	409
Acres of bird nesting territories monitored2	5,750
Acres monitored and/or treated for noxious weed control	5,723
Cubic yards of gravel added to streams to enhance fish spawning habitat	930
Acres monitored for use by special-status species3	4,378

¹ This measure refers to miles of stream monitored for its environmental condition, such as water quality/flow, sediment management, habitat quality, fish populations, and invasive species. In addition, PG&E monitored approximately 300 acres of lake surface on the Pinecrest Reservoir as part of a study to evaluate minimum lake levels for safe recreational use.

² Includes monitoring of Bald Eagle and other nesting territories at PG&E hydroelectric projects.

³ Special status species are those that are listed under the federal or state Endangered Species Acts or as a sensitive species by the U.S. Fish and Wildlife Service. Monitoring studies are required under various hydroelectric licenses.

We also achieved many important milestones in 2010:

PG&E added more than 800 cubic yards of gravel below two dams on the Pit River to enhance habitat for fish spawning.

1. We filed a draft license application with FERC for the existing Drum-Spaulding hydroelectric project on the Yuba and Bear rivers, PG&E’s most complex conventional hydroelectric project. We proposed to continue operating the project’s twelve powerhouses, 10 of which totaling about 86 MW of capacity qualify as renewable resources under the state’s Renewable Portfolio Standard. Combined, these 10 powerhouses produce about half of the project’s total average annual energy output.
   
   Our application addressed a wide range of environmental, cultural resource and recreation issues and proposed draft license measures to protect, mitigate and enhance natural resources and recreation opportunities associated with the project area—while also providing significant public water supply benefits. We expect to file our final application in 2011.
2. We continued the multi-year FERC relicensing process for the existing McCloud-Pit hydroelectric project, PG&E’s largest conventional hydroelectric project. The application, which we filed in 2009, includes 22 proposed measures to protect, mitigate and enhance natural resources associated with the project. As one milestone last year, we reached agreement with the U.S. Forest Service on these measures, which include a proposal to enhance the timing and amount of streamflows to ensure protection of fish and other aquatic habitat in the Lower McCloud River, a world-class trout fly fishing river.

As part of the Crane Valley hydroelectric project, we installed fencing along a U.S. Forest Service access road to protect the Mariposa pussypaws, a threatened plant.

1. As part of implementing the 36-year operating license PG&E received for the Pit 3, 4 and 5 hydroelectric project in 2007, we began making upgrades in 2009 to the streamflow release facilities at the project’s three dams. In January 2011, we placed the new facilities into service and began releasing higher minimum instream flows. By doing so, we are enhancing approximately 22.5 miles of the Pit River and its associated habitat. PG&E developed the enhanced streamflow plan in collaboration with state and federal resource agencies, Native American tribes, non-governmental organizations and other stakeholders.
2. We began implementing a new 38-year license from FERC for the Spring Gap-Stanislaus hydroelectric project, which we received in 2009. The license covers an existing 87.9 MW project on the South and Middle Forks of the Stanislaus River spanning Tuolumne and Calaveras counties. Our work last year included upgrades to the Relief Dam at an elevation of 7,000 feet in the High Sierra, which, with a new automated system, will allow PG&E to better control the year-round streamflows from a remote location. Activities in 2011 will include major recreation improvements to Pinecrest Lake, a popular destination for fishing, swimming and boating.
3. In 2009, FERC approved PG&E’s proposal for balancing agricultural water needs with natural resource protection for the existing Potter Valley hydroelectric project. FERC’s approval completed a challenging three-year effort by PG&E, the Potter Valley Irrigation District, National Marine Fisheries Service and other stakeholders to develop a plan to protect Russian and Eel river resources while providing a more flexible water supply to the Potter Valley agricultural community. The order allows PG&E to deliver more water to the irrigation district when needed by reducing deliveries during less critical periods.
   
   In 2010, PG&E completed construction on a permanent by-pass system to route water around our powerhouse and into the East Branch Russian River. This automated system helps ensure a continual flow of water for the benefit of both fish and the agricultural sector when the powerhouse is shut down.

Restoring Habitat through Partnerships

PG&E, in partnership with federal and state resource agencies, made significant progress last year toward the long-term goal of restoring approximately 42 miles of Chinook salmon and steelhead trout habitat on Battle Creek, as well as six additional miles on its tributaries. The project represents one of the largest cold-water salmon and steelhead restoration efforts in North America. (Watch a video about the project.)

This project is a voluntary effort by PG&E and its partners to restore habitat for the threatened and endangered fish while continuing to provide hydroelectric power for customers.

In 2010, as part of the project’s first phase, the project team broke ground on constructing two new state-of-the-art fish ladders, scheduled to be completed by the end of 2011. We also removed a dam on the creek’s North Fork, a step toward the project’s goal of opening up historic habitat for the first time since the early 1900s. The project team also began the second phase of the project by starting construction on the first of two major upgrades to our facilities along the South Fork.

We also continued to collaborate with CalTrout, a conservation group, to develop a tool for prioritizing cost-effective strategies to recover threatened and endangered salmon and steelhead in the Sacramento River Basin. Known as RecoveryExpress, the tool is designed to be used by PG&E, regulatory agencies and other stakeholders to help guide future habitat enhancement efforts.

Increasing Renewable Energy for Our Customers

In 2010, we continued to implement the 30-year license for the Kern Canyon hydroelectric project, which we received in 2009 from FERC. This existing 11.5 MW project is located on the main stem of the Kern River in Kern County. The power generated by this small hydroelectric project qualifies as renewable and helps PG&E meet the mandate under California’s RPS. PG&E is implementing enhanced streamflows and is performing studies to assess and minimize impacts to certain fish and groups of wildlife in the project area. Once complete, these studies will inform whether additional protection or monitoring activities are needed.