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The endless wrangling over the rights to water from the Klamath River, the second largest river in California, may finally be over. The dispute has involved farmers and fishermen, the U.S. Government and Native American tribes. Among other things, the proposed agreement would establish a water bank to maintain water levels in times of drought. It would rebuild fish populations and habitats, and it would allocate water for agriculture and wildlife.

The deal has been two years in the works and it hinges in part on the destruction of four hydroelectric dams. That will be the largest dam removal in U.S. history. But first, as David Gorn reports, the owner of those dams has to agree to the demolition.

DAVID GORN: In the unpredictable world of California politics, you can always count on one thing, if there's water, there's a fight. And there's been no water fight quite like the one over the Klamath River. You've got massive salmon kills, federal bailouts for ocean fishermen, longstanding feuds, and Warren Buffet's electric company at the center of all of it. It's quite a mix. But wonder of wonders, says state fish and game official Steve Thompson, there has been a breakthrough, an agreement.

Mr. STEVE THOMPSON (Regional Director, California Department of Fish & Game): Tension and stress along the river has been going on for longer than I'm alive. So the fact that very different groups have come together to come up with solutions, functional solutions on the river is nothing short of amazing.

GORN: Everyone along the river it seems has had a hand in the recent agreement. Farmers who need the water to irrigate, Native Americans down river who need water flowing for some of the largest salmon runs in the nation, state agencies from California and Oregon, the Department of the Interior, Environmentalists, irrigators, regulators. For the first time in recent memory, everyone is in agreement. Well, not quite everyone.

(Soundbite of gushing water)

GORN: The flashpoint of the last remaining Klamath argument is here, at the Iron Gate dam. The Iron Gate sounds a lot more imposing than it is; really it's not much of a dam. It looks like a big pile of rock, walking up the river with a large straw coming down on side of it, leading into a small, energy-generating room.

This generator produces about 18 megawatts of power. Altogether, the four hydroelectric dams on the Klamath pump out enough electricity to supply about 70,000 homes. Of the four dams, Iron Gate is the southern most one, which means it is as far as salmon are allowed to go up to river.

Mr. TROY FLETCHER (Yurok Tribal Leader): Historically, fish went much farther up into the Klamath basin.

GORN: Troy Fletcher is a Yurokenisian(ph) tribal leader. The Yurok had long been against these dams saying they've altered the entire river, keeping salmon and steelhead away from their spawning grounds and fallowing the water.

Mr. FLETCHER: This dam here, Iron Gate dam, represents the ending point that has driven many of those species of fish to the brink of extinction.

GORN: But these days, the Yurok are far from alone in trying to take down the dams. The Federal Energy Regulatory Commission said it won't renew the license for the dams unless costly improvements are made. The California Energy Commission said it would be cheaper to destroy the dams than upgrade them. And now all the stakeholders on the river all say the same thing - take out the dams.

Not so fast, says Toby Freeman.

Mr. TOBY FREEMAN (Hydro Relicensing Manager, PacifiCorp): I think that the rationale for dam removal is not very well supported and I think the environmental risks associated with dam removal is quite high.

GORN: Freeman is a spokesman for the company that owns the dams, PacifiCorp, which is owned by billionaire Warren Buffet. First off, Freeman says, those salmon get a 190 miles to roam up the Klamath before they even encounter the dam.

Mr. FREEMAN: Actually, no, we are not seeing salmon and steelhead right now banging their heads against Iron Gate dam in hopes of moving upstream.

GORN: In fact, Freeman goes a step further to say that the dams actually might help the salmon by breaking up algae blooms from the lake that feeds the river, thereby improving water quality.

Mr. FREEMAN: To put it simply, our hydroelectric project appears from the data to be functioning much like a sewage treatment plant.

GORN: The resistance put up by PacifiCorp is understandable. It is not just the $97 million a year in electricity at stake, but also the cost of demolition and debris removal could balloon out of control. At its root, this is a financial decision. Will it cost more to upgrade the dams or to destroy them? PacifiCorp is meeting now with government officials and river representatives to try to work that equation out. Several committee members said a decision could come in the next two months.

For NPR News, I'm David Gorn.

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