Power on Their Own Terms: Tribal Utilities and Energy Self-Sufficiency

On August 9, 1961, President John F. Kennedy wrote to the Seneca Nation of Indians to reject their calls for halting construction of the Kinzua Dam on the Allegheny River in Pennsylvania. Kennedy acknowledged the “very deep sentiments” over the Seneca Nation’s loss of nearly 10,000 acres within their Allegheny Reservation, “lands,” he observed, “which have been owned by the Seneca Nation for centuries.” But the President explained that his interference with Congressional efforts to provide flood control protection for downstream communities would be “improper.”¹ As a result of the dam’s construction, over six hundred citizens of the Seneca Nation of Indians were displaced and ancestral graves were desecrated.²

After the dam’s completion in 1965, the Federal Power Commission authorized a 50-year license for hydroelectric power from the Kinzua Pumped Storage Project, which drew water from a reservoir created by the dam. According to Dennis Bowen, former President of the Allegheny Seneca Nation in New York, within two years of the dam’s completion and the hydroelectricity license’s authorization, half of the Seneca Nation’s elders had died, their demise attributed by Bowen to their “broken hearts.”³ The Kinzua Project would eventually generate 452.35 megawatts of electricity, enough to power over 450,000 homes across the region, but only at the cost of traumatizing and displacing an entire people.⁴

Across the United States, harrowing stories of energy developments’ impacts on tribal nations abound. From the Allegheny to the Yellowstone River in Montana and beyond, the federal government has historically rebuffed the natural resource interests of tribal nations in favor of electric utilities.⁵ This tragic dynamic has emerged despite protections for tribal nations enshrined in treaties and Supreme Court cases. The Treaty of Canandaigua of 1794, signed by President George Washington’s Secretary of State, promised the United States would “never claim the same, nor disturb” the Seneca Nation’s lands.⁶ The Supreme Court’s Winters decision in 1908 held that tribal nations had implied water rights that superseded those of United States interests.⁷ Nevertheless, as Judge Leonard P. Moore of the U.S. Court of Appeals for the Second Circuit observed of the Allegheny Reservation’s flooding for the Kinzua Dam, “it is the Government which is the Indian giver and the Government which breaks its word.”⁸

Tribal nations, objecting to disruptive and harmful energy developments, have historically been dismissed as inhibitors of societal progress.² Today, however, the federal government is facilitating programs that fundamentally upend that paradigm, partnering with tribal utility organizations to build the electric grid of the future.

Tribal nations’ reservations span approximately 56 million acres, held in trust by the Bureau of Indian Affairs within the Department of Interior.⁹ Many reservations contain abundant natural resources like coal, oil, natural gas, and uranium.¹⁰ Under federal law, tribal nations can lease their land to mining and drilling companies for profit. The revenue collected from energy resource leases is transferred to accounts for individual tribal members held by the Bureau of Indian Affairs.¹¹ Historically, however, energy resources on tribal land have been subject to the jealous interests of investor-owned utilities and the federal government, and extraction has sometimes led to disenfranchisement.

Take the Black Mesa controversy in Arizona. Hopi and Navajo tribal councils leased 65,000 acres of coal-rich reservation land to Peabody Coal in 1966 with hopes of enjoying economic prosperity. But Peabody’s operations failed to enrich either tribal nation and required the use of one billion gallons of water per year from the Black Mesa aquifer,¹² compromising the tribal nations’ precious water resources.¹³ The Navajo Nation sued Peabody and other southwestern utilities in 1999, alleging that the companies deceived the Nation in order to pay lower royalty rates on the coal within their tribal lands.¹⁴ In 2011, the utilities settled with the Navajo for US$65 million.

The Black Mesa settlement followed in the wake of another groundbreaking tribal lawsuit, this time against the federal government. In 1996, under the leadership of Blackfeet tribal elder Elouise P. Cobell, the nations alleged that the Department of Interior had mismanaged revenue from tribal energy resource leases for decades. In 2009, the Obama Administration settled with Cobell and the tribal nations for US$3.4 billion.¹¹ When it comes to energy resources, tribal nations have thus had ample reason to doubt the good faith of investor-owned utilities like Peabody as well as the federal government.

Bruised by their mistreatment, and concerned by the environmental impacts of electricity generation from fossil fuels, some tribal nations have created their own tribal utility organizations. A tribal utility is an energy company fully owned and operated by a tribal nation, delivering power to the reservation and providing employment to their members.¹⁵ Tribal utilities have been especially important for tribal economic development considering that an estimated 20 percent of tribal nations lived in poverty in 2010.¹⁶ Through tribal utilities, tribal nations have largely pursued the development of renewable energy projects that provide energy independence and mitigate the demand for carbon-intensive electricity. Tribal utilities give tribal nations energy self-sufficiency, and the agency to draw from and contribute to the electric grid on their own terms.

To its credit, the United States Congress has encouraged tribal energy ambitions through various pieces of legislation, including the Energy Policy Acts of 1992 and 2005 as well as the Indian Tribal Energy Development and Self-Determination Act of 2005. These laws created the Office of Indian Energy Policy and Programs in the Department of Energy, removed barriers for tribes to independently enter into lease agreements for energy resources, and promoted development of wind, solar, biomass, geothermal, and energy efficiency projects on tribal lands.¹⁷ From 2002 to 2014, the Office of Indian Energy Policy and Programs assisted tribal nations in bringing 580 megawatts of renewable energy into development through investments of US$48 million in 183 tribal clean energy projects.¹⁸ The Department of Energy has assessed that despite retaining control of only two percent of land in the United States, tribal nations have access to five percent of American renewable energy resources.¹⁹ Tribal utilities are at the forefront of innovating through clean energy technology, sustainably pursuing economic development goals.²⁰

But obstacles for tribal energy development remain. In 2016, the non-partisan Government Accountability Office identified unnecessary bureaucratic hurdles, such as poor workforce planning in the Bureau of Indian Affairs, as well as uncoordinated federal agencies, hindering tribal energy ambitions.²¹ Responding to these concerns, Congress is currently weighing amendments to the Indian Tribal Energy Development and Self-Determination Act that would facilitate tribal nations’ energy development goals by streamlining regulatory processes at the Department of Interior.²² These amendments, which promote greater tribal self-sufficiency, have bipartisan support, demonstrating how the federal consensus on tribal nations has shifted dramatically since President Kennedy’s era. Perhaps exemplifying the shift, President Obama posthumously awarded the Presidential Medal of Freedom in November 2016 to Elouise P. Cobell of the Blackfeet Nation, who championed tribal self-sufficiency by bringing suit against the federal government in 1996.²³

Fittingly, the Seneca Nation of Indians, once displaced by the federal government, has leveraged federal support for the purpose of energy development. In 2003, the Seneca Nation began a partnership with the Department of Energy to assess paths to energy self-sufficiency.²⁴ The tribal nation has since created its own utility, Seneca Energy LLC, dedicated to ensuring “the security, prosperity and independence of the Seneca Nation by building a sustainable energy platform and lowering energy costs for the Nation and its residents.”²⁵ Seneca Energy has begun construction on a 1.8 megawatt wind turbine that would earn the tribe credit through New York’s net metering program, thereby lowering electricity costs for tribal members.

But most crucially, anticipating the 2015 expiration of the Kinzua Dam’s 50-year license issued in 1965, Seneca Energy applied for the license to operate the very hydroelectric facility that had brought their nation so much misery. Writing in the Huffington Post, Dave Kimelberg of the Seneca argued that his tribe had “the capabilities and resources to do this effectively and efficiently, and bring necessary power to an economically depressed region sorely in need of business infrastructure.”²⁶ Were Seneca Energy to attain the license, Kimelberg observed, “the U.S. government would take a long overdue first step in making amends and helping to bring some dignity to an immoral situation.” Ultimately, the Seneca formally withdrew its application to operate the Kinzua Dam, citing a settlement agreement that “[resolved] a variety of the issues” between the tribal nation and the electric utility, FirstEnergy.²⁷ The stipulations of the settlement were not disclosed, but what is clear is that absent the technical capacity to operate the dam through Seneca Energy, the Seneca Nation of Indians would not have had leverage with which to bring FirstEnergy to the table.

Tribal utility organizations are promising agents for catalyzing tribal self-sufficiency, energy independence, and economic development. Tracing the tragedy of the Seneca Nation’s displacement by the Kinzua Dam to Seneca Energy LLC’s application for the dam’s operating license, one can see the potential for beginning to right historical wrongs through these means.

References

1. Kennedy, JF. Letter to the President of the Seneca Nation of Indians Concerning the Kinzua Dam on the Allegheny River, August 11, 1961. The American Presidency Project [online]. http://www.presidency.ucsb.edu/ws/?pid=8279.
2. Hauptman, LM. In the Shadow of Kinzua: The Seneca Nation of Indians since World War II (Syracuse University Press, New York, 2013).
3. Rose, C. 9 Reasons NOT to Celebrate the 50th Anniversary of the Kinzua Dam. Indian Country Today Media Network [online] (2015). https://indiancountrymedianetwork.com/history/events/9-reasons-not-to-celebrate-the-50th-anniversary-of-the-kinzua-dam/.
4. Federal Energy Regulatory Commission. Order Issuing New License. 152 FERC ¶ 62,045 [online]. https://www.ferc.gov/CalendarFiles/20150723131023-P-2280-018Order.pdf.
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7. Winters v. United States, 207 U.S. 564 (1908).
8. Seneca Nation of Indians, Appellant, v. United States of America, Appellee, 338 F.2d 55 (2d Cir. 1964) [online]. http://law.justia.com/cases/federal/appellate-courts/F2/338/55/333596/.
9. United States Geological Survey. Indian Lands of the United States. The National Map Small Scale [online] (2015). https://nationalmap.gov/small_scale/mld/indlanp.html.
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11. Savage, C. U.S. Will Settle Indian Lawsuit for $3.4 Billion. New York Times [online] (December 8, 2009). http://www.nytimes.com/2009/12/09/us/09tribes.html.
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13. Lee, T & Wilson, SJ. Holes and cracks scar Black Mesa landscape. Indian Country News [online] (2007). http://www.indiancountrynews.com/index.php/news/26-mainstream-politics/38-holes-and-cracks-scar-black-mesa-landscape.
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18. Strategic Roadmap 2025. U.S. Department of Energy Office of Indian Energy Policy and Programs [online] (2016). http://energy.gov/sites/prod/files/2016/03/f30/DOE%20Office%20of%20Indian%20Energy%20Strategic%20Roadmap%202025.pdf.
19. Developing Clean Energy Projects on Tribal Lands. U.S. Department of Energy Office of Indian Energy Policy and Programs [online] (2012). http://www.nrel.gov/docs/fy13osti/57048.pdf.
20. Keen, J. For Indian tribes, economic needs collide with tradition. ABC News [online] (2009). http://abcnews.go.com/Business/story?id=7002860&page=1.
21. Indian Energy Development: Additional Actions by Federal Agencies Are Needed to Overcome Factors Hindering Development. United States Government Accountability Office [online] (2016). http://www.gao.gov/assets/690/680935.pdf.
22. Policy Update: July 2016. National Congress of American Indians [online] (2016). http://www.ncai.org/policy-issues/July_2016_Policy_Update.pdf.
23. President Obama Names Recipients of the Presidential Medal of Freedom. Office of the Press Secretary [online] (2016). https://www.whitehouse.gov/the-press-office/2016/11/16/president-obama-names-recipients-presidential-medal-freedom.
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26. Kimelberg, D. A Chance to Right a Wrong: The Seneca Nation of Indians and the Kinzua Dam. The Huffington Post [online] (January 27, 2011). http://www.huffingtonpost.com/david-kimelberg/a-chance-to-right-a-wrong_b_812732.html.
27. Spiegel & McDiarmid LLP. Notice of Permanent Withdrawal of Notice of Intent to File License Application Seneca Nation of Indians, Project No. 13889-000 [online] (2013). http://www.waterpowerlaw.com/news/seneca-pumped-storage-project-settlement-agreement.