A major California water lifeline serving more than 600,000 residents is on the brink of being shut down by one of America’s largest utility companies – and now its fate may lie in the hands of Donald Trump.
Since 1922, the century-old Potter Valley Project has diverted water from Northern California’s Eel River into the Russian River, serving as a critical source of water for farms and communities across Mendocino, Sonoma, Marin and Lake counties.
However, PG&E announced plans to fully dismantle the project, citing financial losses and aging infrastructure – a move that sparked controversy across the region, SF Gate reported.
In a rare twist, the federal government is now stepping into the local water battle, as the Trump administration reviews whether or not to block the shutdown.
‘If the Federal Energy Regulatory Commission (FERC) accepts the decommissioning plan by PG&E, there will be devastating impacts to infrastructures, economies and public safety,’ presidents of local farm bureaus wrote in a letter to Trump, SF Gate reported.
The Potter Valley Project, consisting of the Scott Dam and the Cape Horn Dam, became a hydroelectric facility after PG&E took over in 1930, later renewing its license for another 40 years in 1983.
The project’s license was set to expire in April of 2022, but instead of applying for renewal, PG&E chose to withdraw.
Later, they announced its plans to decommission the entire system, which would take effect on July 29, 2025.
The century-old Potter Valley Project has diverted water from Northern California’s Eel River into the Russian River, serving as a critical source of water for farms and communities across Mendocino, Sonoma, Marin and Lake counties – but now faces potential shut down
PG&E announced plans to fully dismantle the Potter Valley Project due to financial losses and aging infrastructure – a move that sparked controversy across the region as the water lifeline serves more than 600,000 residents
In a rare twist, the federal government is now stepping into the local water battle, as the Trump administration reviews whether or not to block the shutdown and ensure it aligns with an executive order directing federal agencies to avoid placing an ‘undue burden’ on domestic energy recourses
Its reasoning was clearly stated in the application: ‘The Project has been recognized by PG&E as uneconomic for PG&E’s customers (i.e., the cost of production exceeds the cost of alternative sources of renewable power on the open market).’
Along with money problems, the company flagged the Scott Dam as a major safety risk, with engineers warning that its century-old structure may not withstand an earthquake.
PG&E recognized the consequences of its decision, stating in the draft application that removing Scott Dam and Lake Pillsbury ‘could have unavoidable effects on recreation value, community way of life, and population and housing in the Scott Dam area’.
The draft also acknowledged that dismantling the project ‘may have unavoidable adverse impacts to water reliability and cost, economic opportunity (particularly farming and ranching), recreation value in the Russian River Watershed and community way of life’.
While PG&E plans to move forward despite the concerns, farmers, ranchers and local officials warned that the outcome would devastate local farms, economies and wildfire defenses across the North Coast – potentially threatening the fate of the multimillion dollar auriculate industry.
On April 4, local farm bureaus of the Lake Pillsbury Alliance sent a joint letter to the Trump administration, urging the president and his closest Cabinet members to halt the decommissioning process.
In it, they argued that the company’s plan goes against a presidential order from Trump, which is meant to protect water delivery efforts, SF Gate reported.
The entities urged the Bureau of Reclamation to take over the ownership of the dam to ensure continued water deliveries to hundreds of thousands of North Coast residents.
On April 14, the Bureau of Reclamation responded to a letter urging Trump’s administration to step in. Signed off by acting Commissioner David M. Palumbo (pictured), the response noted that the concerns raised by the Lake Pillsbury Alliance were consistent with those of other local stakeholders in recent weeks
Farmers, ranchers and local officials have warned that the plan would devastate local farms, economies and wildfire defenses across the North Coast – potentially threatening the fate of the multimillion dollar auriculate industry
The Bureau also identified two potential funding sources: the Department of the Interior’s Aquatic Ecosystem Restoration Program and the Inflation Reduction Act’s water system resilience funds – both created under the Biden administration
Estelle Clifton, president of the Mendocino County Farm Bureau, said that since the Scott Dam is located on public land, it would be ‘sensible’ for the federal government to take ownership it manage it as a national water project, San Diego Post reported.
On April 14, the Bureau of Reclamation responded, stating that the project funding is ‘undergoing reviews’ to ensure it aligns with Trump’s executive order.
The executive order directs federal agencies to avoid placing an ‘undue burden’ on domestic energy recourses – including hydropower.
The Bureau also identified two potential funding sources: the Department of the Interior’s Aquatic Ecosystem Restoration Program and the Inflation Reduction Act’s water system resilience funds.
Both programs, created under the Biden administration, could provide additional leverage for federal involvement.
The letter, signed off by acting Commissioner David M. Palumbo, noted that the concerns raised by the Lake Pillsbury Alliance were consistent with those of other local stakeholders in recent weeks.
The administration’s response signals a rare willingness to address local concerns, as the federal government typically avoids stepping into regional issues like this.
However, if Trump intervenes, it wouldn’t be the first time his administration has waded into California’s water conflicts.
PG&E recognized the consequences of its decision, stating in the draft application that removing Scott Dam and Lake Pillsbury ‘could have unavoidable effects on recreation value, community way of life, and population and housing in the Scott Dam area’, but still referred to the Scott Dam as a major safety risk
In January, the president ordered the Army Corps of Engineers to release 2.2 billion gallons of water from Lake Kaweah and Lake Success – both of which are key Central Valley reservoirs
In January, the president ordered the Army Corps of Engineers to release 2.2 billion gallons of water from Lake Kaweah and Lake Success – both of which are key Central Valley reservoirs, SF Gate reported.
The White House considered the order, which came during a time of low irrigation demand, wildfire support for Southern California.
On the other hand, lawmakers and water experts labeled the release as a political stunt, arguing that the water wouldn’t actually reach the systems in Southern California.
For now, the fate of the Potter Valley Project remains uncertain, as local, state and federal interests clash over the decision.
