In January, the power company PacifiCorp notified state officials of the expiration of a deal that for decades has supplied farmers on the Oregon-California line with some of the cheapest electricity around. It means that the owners of about 1,300 farms, most in Oregon, could be socked next year with more than tenfold rate increases.
"The profitability of growing many crops is pretty thin already," says farmer Lynn Long, who leads a group opposing the rate change. "This would push people over the edge."
Environmental groups, meanwhile, see the looming rate increases as a free-market tool that will achieve what they have not been able to: eliminate marginal farms and free up water for fish and birds.
"When this (marked-down rate) goes away, it’s going to be a big step in bringing everything back into balance," says Jim McCarthy of the Oregon Natural Resources Council.
But higher rates may not be all good for the environment, say farmers and others: New sprinkler systems underwritten with some $50 million in federal aid to promote water conservation might become unusable because of high pumping costs. Wells supplying a government-funded "water bank" that provides extra water for wildlife — but depresses the water table — would become much more expensive to operate. And farmers might return to flood irrigation, which requires less pumping but consumes more water — potentially compounding the irrigation shortages that reached a breaking point in 2001.