Real Clean Energy: Hydro Dammed Up by Regulations

Hydro Dammed Up by Regulations

William Tucker

Real Clear Energy

December 4, 2015

http://www.realclearenergy.org/articles/2015/12/04/regulation_impedes_retrofitting_of_old_dams_108913.html

“I was talking with someone in the nuclear industry the other day and he said, `Gee, I didn’t realize you people were having the same problems we have.’ When it comes to getting through the permit process, we’re not much different from nuclear.”

So says Jeff Leahey, deputy executive director of the National Hydropower Association, the Washington lobbying group that supports the hydroelectric industry. NHA finds this particularly frustrating since it is in the midst of a revival that involves retrofitting existing dams with hydropower.

“Hydro is handicapped by an outdated licensing process that lacks coordination between federal and state agencies,” says LeRoy Coleman, senior manager of communications at NHA. “The result is duplicate reviews, conflicting priorities and deferred decision-making that delays real environmental improvements. These roadblocks are pushing the licensing process for some plants to nearly a decade.”

Hydropower projects deal mainly with the Federal Energy Regulatory Commission (FERC), which has authority over all hydroelectric projects. But there are nearly half a dozen federal and state agencies that must be brought into the process as well. The National Fish and Wildlife Service, the Environmental Protection Agency plus various state agencies concerned with the environment and water courses have their hand in as well.

“Under the status quo, state and federal resource agencies often fail to complete their important obligations under federal environmental laws within a reasonable timeframe,” says Coleman. “As a result, a proposed project can be rejected simply through an agency’s failure to make a decision. It may take ten years to get through the process.”

This timeframe exists both for new hydroelectric dams and for retrofitting older ones to electricity, which is the Association’s main interest right now. “Under normal circumstances, the process takes about five years to complete,” says Leahey. “The average natural gas combined cycle plant takes only 18-24 months start to finish. Now compare ten years with 24 months. The uncertainty of the process is what makes it difficult for hydropower to attract investment.”

The delays are particularly frustrating since the industry believes it has enormous contribution to make in the search for clean power sources. Two years ago, Oak Ridge National Laboratory published a paper published noting that the U.S. has a potential of 12 gigawatts – that’s 12,000 megawatts – in existing dams that were not built for hydroelectricity. The Army Corps of Engineers and other federal agencies have been busy building these dams over the last 50 years. There are now 80,000 such sites around the country, yet only 3 percent of them are producing power. If fitted for electricity, the dams would provide enough juice to power over four million homes.

“The common perception is that hydro in this country is pretty well tapped out because the growth curve over the last 20 years has been pretty flat,” says Leahey. “But there’s still enormous potential in dams that have already been constructed but haven’t been outfitted for hydroelectricity. Now that the focus has turned to clean energy investment, we’re seeing a revival of interest in hydropower.”

The biggest source of potential is in the network of lock-and-lift dams build along the valleys of the Ohio, Mississippi, Alabama and Arkansas Rivers. The map published by Oak Ridge National Laboratory shows these river valleys virtually clogged with sites awaiting improvement. The ten top sites have the potential for 3 GW and the top 100 sites together could potentially provide 8 GW of renewable energy.

Work has already begun on a few of these sites. Along the Ohio the Cannelton Dam in Indiana, the Smithland Dam in Livingston County, Kentucky and the Meldahl Dam in Braden County, Kentucky have already been retrofitted for 88 MW, 76 MW and 111 MW respectively. Two additional Army Corps of Engineer candidates for development are the Willow Island Dam in Pleasants County, West Virginia and the RC Byrd Dam in Gallipolis Ferry, West Virginia. They would provide 44 MW and 48 MW respectively. These projects have gone through the arduous review process. The Department of Energy says there are currently 331 dam sites going through the review process, including one for a 700 MW project in Alaska. 

The effort to improve these dam sites has not been evaluated from an economic point of view. “The analysis did not consider the economic feasibility of developing each unpowered facility,” writes Boualem Hadjerioua, the principal investigator at Oak Ridge National Laboratory in a report titled “An Assessment of Energy Potential in Non-Powered Dams in the United States,”published two years ago. “The assessment provides preliminary information for stakeholders (such as developers, municipal planners, and policymakers) who can further evaluate the potential increase hydropower production at NPD sites.” But according to the National Hydropower Association, that potential is great and the economics are feasible.

There is one other factor that figures into the equation. Many environmental groups are currently touring the country campaigning to tear down existing dams. The Sierra Club managed to have a measure put on the ballot two years ago that would have torn down the Hetch-Hetchy Dam, which provides San Francisco with half its electricity and 2/3rds of its water. The referendum was soundly defeated.

Such groups function better in court and before regulatory agencies, however. Is there any possibility that they may set up roadblocks to the retrofitting of existing dams?

“For the most part we’ve been able to deal with them,” says Leahey. “The environmental impact is already there with the construction of the dam so there’s not too much at issue. In some cases we’ll agree to the closing of one older dam if we can double the power output of another in the neighborhood. So it comes out pretty even.”

NHA is currently backing legislation in Congress that would put FERC in charge of all the permitting and try to speed up the process. As with nuclear, it is the glacial pace of the review process that is holding the industry back. If the news coming out of Paris is of any significance, there’s much work to be done.