Ecosystem Service Values and the Klamath River Dam Removal

In February 2010, two agreements were finalized by Federal, State, and Tribal governments and PacifiCorp, a utility company that owns dams on the Klamath River: the Klamath Basin Restoration Agreement (KBRA) and the Klamath Hydroelectric Settlement Agreement (Settlement Agreement). These agreements included provisions that would affect the Klamath River Basin such as removing four dams on the Klamath River, habitat restoration projects, and water allocation schedules for water users. To determine whether implementing these agreements would provide environmental benefits that outweighed the costs, an extensive benefit-cost analysis was undertaken, a collaboration between agencies within the Department of Interior and the Department of Commerce’s National Oceanic and Atmospheric Administration. Ecosystem service benefits such as the restoration of salmonid fisheries, improvements to irrigated agriculture, and increased recreational opportunities were evaluated against ecosystem service costs such as dam removal, forgone hydropower, and habitat restoration activities. When considering these and other use values, the net benefit of implementing the KBRA and Settlement Agreement was negative (-US$1.6 billion). When including non-use values such as public willingness-to-pay to reduce the extinction risk of Coho salmon, the net benefit of implementing these Agreements was positive (+US$14.1 billion). The addition of these non-use ecosystem service values tipped the scales in favor of the preferred outcome: removing the four Klamath Dams and implementing the other provisions of the Agreements. This talk will discuss the range of ecosystem service values that were evaluated, the controversial nature of the benefit-cost analysis, and the underlying politics and historical context surrounding the Agreements.