Increasing Hydro’s Stakes

November 02, 2009

Ken Silverstein, EnergyBiz Insider
Editor-in-Chief

The hydropower industry is gushing with enthusiasm. A new study commissioned by its top Washington lobbying organization says that with the proper federal incentives and initiatives, it could provide up to 25 percent of the nation's power by 2025.

That, of course, is wishful thinking. But the central premise behind its study is worth noting -- that hydropower will get swept up in the clean energy trends now breezing across the country. And as such, its share of the electricity market will grow. The industry group says that hydro facilities could easily become more efficient and thereby improve the output at existing plants.

The U.S. hydropower industry today has 100,000 megawatts of installed capacity, says the National Hydropower Association, which released a study discussing the sector's potential. The segment will add 60,000 megawatts of new capacity through new technologies, efficiency improvements, and research and development. The goal, it adds, is to increase its total generating capacity to 300,000 megawatts.

"The hydropower industry is prepared to double its current capacity of clean, domestic, renewable waterpower resources," says the Andrew Munro, who is the president of the association and head of Grant County (Wash.) Public Utility District. "Hydropower offers tremendous potential for America to double its renewable energy production, provide reliable electricity for American families, and create thousands of new jobs."

According to their study, only 3 percent of the nation's the 80,000 dams are able to generate electricity. The additional capacity would come from making those current facilities more resourceful and by retrofitting them with new technologies that will enable them to bolster production.

If the hydro industry is to accelerate its growth, the lobbying organization says that hydro must be given the same opportunities as other green energy forms. It says specifically that developers must be given long-term tax incentives that are on par with other types of renewable energy and that regulators must accelerate licensing procedures.

That's especially true for small hydro plants and pumped storage facilities, which are able to hold water that can be later used to generate electricity and which can increase hydro capacity. About 40 storage facilities are planned, which would create 30,000 megawatts.

The Federal Energy Regulatory Commission is already reviewing licensing applications for more than 65,000 megawatts of hydropower. Among those already in the works: American Municipal Power, which has recently begun the first of five hydroelectric projects at existing dams on the Ohio River in Kentucky. The company's five proposed projects represent the largest development of new run-of-river hydroelectric facilities in the United States, or 350 megawatts.

Hydro Infrastructure

Hydro is mature. But it has found new channels from which to grow. The sector's next phase is focusing on smaller hydro units that are less disruptive environmentally but still useful in supplying electricity to remote areas. Government researchers say that almost 60 percent of the nation's water energy resources are potentially available for development using newer, environmentally-friendly technologies.

Most of those units that are under consideration are "run-of-river" that would generate electricity by using distributed hydropower units that include underwater watermills. While such technology is dependent on stream flow and access to power lines, it does not require the construction of dams that block water and kill off aquatic life.

By contrast, the conventional way to produce hydroelectricity is through dams. But the amount of power is contingent upon the speed of the water that turns the turbines. Dams can increase the velocity by raising the water level. But they leave big footprints and can cause local populations to disperse. Investors, meantime, are skeptical because the permitting process is slow and costly.

Creative solutions are the key to hydro's growth. Consider Hydro Green Energy, which in partnership with the city of Hastings, Minn. has installed hydrokinetic turbines downstream from an existing 4.4 megawatt run-of-river hydro plant along the Mississippi River there. The city says that its power production will rise by as much as 5.7 percent as a result.

Meantime, Brookfield Renewable Power is adding a 10.3 megawatt hydropower facility at one of its dams along the Mississippi River in Minneapolis. And, Grant County Public Utility District is upgrading an existing facility by installing "fish-friendly" hydropower turbines and generators at two of its dams on the Columbia River in Washington State. That will add 430 megawatts, it says, or enough to power 150,000 homes.

"There's no one solution to the energy crisis, but hydropower is clearly part of the solution and represents a major opportunity to create more clean energy jobs," says Energy Secretary Steven Chu. "Investing in our existing hydropower infrastructure will strengthen our economy, reduce pollution and help us toward energy independence."

He adds that hydro energy can be stored behind dams and released when it is most needed. Therefore, improving the country's hydro infrastructure can help to increase the utilization and economic viability of intermittent renewable energy sources like wind and solar power. The Department of Energy is providing $32 million in stimulus funding to modernize the existing hydropower infrastructure as well as increase efficiency and reduce environmental impact.

While the hydro industry's lobbyists are touting some aggressive goals, the sector's growth is likely to be more tempered. That said, contemporary technologies in conjunction with pending developments will serve to increase hydro power's stakes in the electricity market.

More information is available from Energy Central:

• Hydro Revisited, EnergyBiz, Nov/Dec 2008

• Mississippi River Generation - Catching Current, EnergyBiz, May/June 2008

• New Approaches to Hydro - Boosting Power Output, EnergyBiz, Jan/Feb 2008