Oregon tribes boost stake in key renewable energy project

Utility says the resource ‘plays an important, and difficult to replace, role’ in its portfolio.


By Pete Danko – Staff Reporter, Portland Business Journal
Jan 27, 2022

The Confederated Tribes of Warm Springs have pushed their ownership stake in Portland General Electric’s Pelton Round Butte hydroelectric project in central Oregon from one-third to just shy of 50%.

Both parties said the move reflects the close partnership they have forged over an energy resource type that elsewhere in the Pacific Northwest has delivered little but pain to Native Americans.

“It could have been a completely different story, but we’re working together to make progress in the right direction,” James Manion, general manager of Warm Springs Power and Water Enterprises, said.

Pelton Round Butte, which adjoins the Warm Springs Reservation, was completed in 1964 with three dams on a 20-mile stretch of the Deschutes River.

Under a 2000 agreement, the tribes acquired their one-third stake on the last day of 2001, with an option to purchase another one-sixth share in 20 years. They recently exercised that option, giving them a 49.99% ownership stake. The agreement gives the tribes the further option of boosting their ownership to 50.01% in 2037.

Like all major hydro projects, Pelton Round Butte has faced habitat-impact issues. An ongoing challenge is managing dam operations to keep water temperature and dissolved oxygen levels within acceptable bounds.

At the same time, its importance for PGE (NYSE: POR) has only grown as climate change had put a premium on clean energy, especially clean energy that can be counted on at virtually any time.

The tribes have always sold their portion of Pelton Round Butte’s energy and capacity to PGE, and will continue to do so under a new deal reached last year that runs through 2040. That revenue stream will help address the debt service for the tribes’ expanded ownership, Manion said.

PGE said the agreement will reduce a forecasted 2025 capacity shortfall from 511 megawatts to 287 megawatts. In a filing, PGE said Pelton Round Butte is its “largest hydroelectric on-system resource and thus plays an important, and difficult to replace, role in PGE’s portfolio.” It generates enough electricity to power about 150,000 homes.