fedgazette Page 13 NINTH DISTRICT FEATURE OCTOBER 2 01 1

Brookfield Renewable Power’s $35 million project on Lower St. Anthony Lock and Dam near down - town Minneapolis involved installing 16 turbines in an auxiliary lock next to the shipping channel. Power from the project can provide electricity for as many as 7,500 homes.

A new look at hydropower

Thanks to new technology and recent tax incentives, new energy proposals are coming to district rivers

By FRANK JOSSI has never been much of a hydropower renewable energy—is also creating ing dam infrastructure to capture water Contributing Writer producer, especially compared with the renewed interest in this old-form power energy at five locks and dams (numbers Colorado, Missouri and Columbia rivers. source. , for example, has 12 3, 4, 6, 7 and 9) between Red Wing, Call it a return to renewable roots. But spurred by aggressive renewable proposed and active projects involving Minn., and Lynxville, Wis., that will gen - Hydropower has been around long energy tax credits and new hydropower dam-and-turbine hydropower on rivers. erate more than 51 megawatts (MW). before the words “renewable energy” technology, a handful of companies have And that’s not all that’s happening became a political lightning rod in the filed plans to transform the lock-and- The Ol’ Miss on the river. Free Flow has proposed energy industry. But over the years, pro - dam system on the Upper Mississippi projects using the same technology for ponents of hydropower have watched it from Minneapolis to Rock Island, Ill., The main player on the Upper dams at Coon Rapids, Minn. (8MW) become a stepchild to sun-absorbing into a small powerhouse of hydro. There Mississippi, Boston-based Free Flow and at Genoa, Wis. (10 MW). Hydro solar panels and spinning windmills. are similar plans for several other lock- Power, has several projects at various Green Energy is working on a similar But thanks to new technology and new and-dam rivers throughout the country, stages of the approval process with the plan at a Red Wing, Minn., lock and applications of old ideas—and tax incen - including the Fox in eastern Wisconsin. Federal Energy Regulatory Commission dam (4MW). And in downtown tives for both—hydropower is again being Though traditional dam-and-turbine (FERC) to develop hydropower at lock- Minneapolis, Crown Hydro has pro - talked about, as proponents argue that hydropower has become somewhat and-dam systems in the U.S. Army Corps posed to divert part of the river to an thousands of dams could be retrofitted to passé over the years because of environ - of Engineers St. Paul District. The com - underground tunnel to create 1.7 MW produce small-batch electricity. mental protests, its relative efficiency— pany has several approaches, but the fun - of renewable power, but has run into a The Mississippi River, for example, especially compared with other forms of damental idea attaches turbines to exist - storm of opposition.

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Hydropower from page 13 The full-scale potential of such proj - With many existing dams at ity, but is the only source of hydropower ects is modest; the Upper Mississippi in North Dakota. Other rivers in that state proposals alone could add close to 100 simply don’t have the flow to produce MW, give or take, to the energy grid, or the end of their design cycle, it’s much energy or do not have a lock-and- a tenth of the power of Xcel’s Prairie dam system that could add hydro, accord - Island nuclear plant, and enough to estimated that the rehabilitation ing to Mike Diller, director of economic power about 75,000 homes for a year. regulation at the North Dakota Public Despite all the FERC filings and grand of dams with the latest designs Service Commission. designs, the only project to reach South Dakota has four major dams on fruition is Brookfield Renewable the , one reason that hydro Power’s 10 MW project near downtown and technology could increase generates almost half of the state’s elec - Minneapolis at the Lower St. Anthony tricity. But the state otherwise has few Falls Lock and Dam, which recently power output at these same dams untapped hydro assets. “The flows on our began producing power. rivers vary dramatically—in spring you But the new proposals have other have good flows; in summer not much is advantages. Dams have been heavily crit - by 20 percent or more. happening,” said Chris Nelson, vice chair icized for producing environmental of the Public Utilities Commission. debacles, but there seems to be no great opposition to the lock-and-dam propos - Follow the money als at this time. Rupak Thapaliya, nation - al coordinator for the Hydropower Relatively new federal incentives might Reform Coalition in Washington, D.C., change the equation a bit. In 2005 and said the proposals he’s seen are “relative - 2008, production tax credits were ly benign” since they build off existing extended to hydropower developers to infrastructure that has no chance of encourage them to improve existing being removed as long as shipping facilities, add hydro to nonpowered remains viable on a river. And as energy dams and build hydrokinetic power in companies and the public alike seek rivers and oceans that takes advantage more renewable energy, the Mississippi of constantly moving water to spin sub - and other rivers in the Ninth District not merged turbines. yet tapped for much hydro are likely to Through the energy investment tax see more attention. credit, hydro and other energy develop - “We’re seeing hydropower included ers write off 30 percent of the cost of a more and more in both state and feder - project. And since developers may want al incentives, whether that be for state that in the form of cash, rather than a renewable energy standards or federal write-off, a Treasury Department pro - tax incentives like the production tax gram allows them to get a direct grant credit,” said Jeff Leahey, the National from the federal government, said the Hydropower Association (NHA) direc - NHA’s Leahey. tor of government affairs. “Those are That’s not all. FERC has been providing incentives for people to look encouraging “small hydro”—defined as at new developments.” less than 5 MW—by streamlining the Hydropower supplies 7 percent of permitting process and dedicating staff total annual electricity generation, but to answer inquiries about it. In a speech two-thirds of the nation’s renewable last year before the U.S. House of electricity, the result of its efficiency in Representatives, FERC’s director of generating electricity compared with energy projects, Jeff Wright, said that other renewables. Jon Guidroz, Free “small hydropower is an important part Flow’s director of project development, of the nation’s energy mix, and offers said water is 800 times more dense and the potential to add a substantial renew - carries 26 times the force of air. able, flexible capacity.” In fact, some hydro plants generate Mark Stover, Hydro Green’s vice electricity more efficiently than even president of corporate affairs and the coal, evident in the average cost per architect of many of the tax credits as kilowatt for each. Reports from the the former lobbyist for the NHA, said Wisconsin Valley Improvement Co., the U.S. Department of Energy, con - million to upgrade Rainbow Dam at one of the primary challenges for which helps operate 25 hydro plants on cluded that by 2025, there could be Great Falls, which will increase its cur - hydro in rivers like the Mississippi is the Wisconsin River for 10 utilities, show 60,000 MW of additional capacity across rent 36 MW of production by 70 percent. attempting to capture energy in low- that hydropower there is produced for the country, enough to power tens of But as much as a third to one-half of head settings. Advocates of evolving less than one cent per kilowatt hour, millions of homes. The added capacity that potential new capacity comes sim - low-head technology say the approach half the cost of nuclear and one-third comes from a variety of sources, includ - ply from adding turbines to dams that allows for energy capture without hav - the cost of fossil fuel. Other reports ing in-stream hydrokinetics, which fea - currently generate no power, and that’s ing to create lakes and change the basic show similar results. tures turbines underwater capturing also where new technology comes into contours of rivers. wave energy, according to Leahey. play. Most dams in place today do not The energy created is modest, but New spin on an old idea The majority of the additional gener - generate power, and that’s because they could be widely applied; only about 3 ation, however, comes from doing more suffer from “low head”—when the percent of the nation’s 82,000 dams cur - Despite that efficiency advantage, envi - with the infrastructure in place. With height of a river above and below a rently produce any power, and about ronmental concerns and protests have many existing dams at the end of their dam or lock is less than about 30 feet; half of those nonproducing dams are at halted any new large-scale dam projects design cycle, it’s estimated that the reha - the lower the drop, the less energy that least 25 feet in height, according to the for decades. Still, many believe there is bilitation of dams with the latest designs can be produced. National Inventory of Dams, compiled potential for significantly more and technology could increase power The over the Missouri by the U.S. Army Corps of Engineers. hydropower production. A recent NHA output at these same dams by 20 percent River—the fifth-largest earthen dam in One of those is Clark Canyon Dam study, corroborated by earlier studies by or more. PPL Montana is spending $230 the world—generates 580 MW of electric - on the Beaverhead River in western fedgazette Page 15 NINTH DISTRICT FEATURE OCTOBER 2 01 1

Montana, where Riverbank Power is Hydro Green that the best market for in energy. Free Flow and Hydro Green, won’t pay enough for the power, the installing 4.7 MW of new generation. its turbines was in conventional in contrast, are relatively small compa - energy developer figures it will be a waste Turnbull Hydro recently put a 13 MW hydropower, and not hydrokinetic, nies with aggressive business goals. of time and money,” she said. plant online in an irrigation canal—a and is now applying that wisdom to Hydro Green has a total of 34 low- And if the first few projects on con - glorified, manmade ditch—in Fairfield, lock-and-dam systems. Using the head dam projects in the pipeline ventional dams or locks and dams Mont., with the support of a local ener - knowledge gained from two years of nationwide, totaling 1,000 MW and has have negative environmental conse - gy supplier. Hydrodynamics, another field tests, the company has created a raised $5.5 million in corporate financ - quences, the energy developers on the small energy provider, has proposed low-head hydropower turbine “we are ing. The company just moved its corpo - river may have a harder time moving nine small projects on existing dams in confident will work in these [lock-and- rate offices from Houston to Chicago to forward, according to Bob Larson of that state, the majority under 3 MW, but dam] settings,” he said. be closer to the sites of its proposals. Nelson Energy, a two-person firm in none have been built yet, according to Free Flow brought in $5.7 million this suburban Minneapolis that develops Tom Kaiserski, who manages the energy Potential challenges year from investors and claims a staff of hydro concepts, including the promotion division of the Montana more than 30 employees, with offices in Brookfield Power operation on Lower Department of Commerce. Still, the reality of widely retrofitting Boston and New Orleans. St. Anthony Falls. Free Flow’s Guidroz agrees that low- dams, or of new hydrokinetic applica - Still, neither company would release FERC’s permitting process requires head technology has come of age. tions, is a bit more sobering. A 2009 even the rough details of the cost of energy developers to notify all parties “You’ve got dams out there with 10, 15, NHA study revealed that the Midwest— adding hydro to a lock and dam. impacted by new dam proposals, includ - 20 feet of head, with an enormous from the Dakotas to Michigan and Brookfield Power’s project on the ing environmental groups. Though the potential onsite to realize power,” he Ohio—have the least hydro potential of Lower St. Anthony represented a $35 Hydropower Reform Coalition and oth - said. “You have to dust off the lenses of any region in the nation. million investment, according to the ers have not expressed opposition to the hydropower and come at it with a new And for all the potential running company’s website. lock-and-dam proposals, Larson perspective.” through these many small-scale proj - More than a few proposals have come recalled something he has heard many Hydro Green used the nation’s first ects, there are many roadblocks, includ - and gone. Nanette Bischoff, FERC coor - times. “Hydro is easy to go after for hydrokinetic energy pilot project at ing the expense of retrofitting a lock dinator with the U.S. Army Corps of opponents because, compared to other the lock and dam in Hastings, Minn., and dam on the Mississippi, and finding Engineers St. Paul District, said market renewals, it has been around the longest to develop a new low-head turbine for the money could pose a problem. conditions have doomed proposals over and the opponents are so well-educated in-stream applications. But Stover said Brookfield, which built the only fin - the years. “It comes down to an econom - on the topic.” f the Hastings experiment proved to ished project, is a deep-pocketed player ic decision, and if energy companies

Hydro in the Ninth District

Since 1999, the hydropower share of electricity production has generally Hydropower’s share of a state’s electricity production is also a bit misleading declined in the district—by as much as a third in some states. because some states are major power exporters. South Dakota produces about That is partly due to two reasons. First, hydropower has seen little expansion three times the hydropower as its northern sibling, but hydropower’s share of over the years, while energy production and consumption have risen signifi - state electricity production is more than 10 times higher (54 percent versus 4 cantly since 1999. Second, hydropower depends on river flows, and the years of percent, respectively). That’s because North Dakota’s vast coal reserves have drought in the Dakotas and Montana have had an impact on its production. made it a major producer (and exporter) of power. That influence can be seen in 2010 figures, which increased dramatically in the The federal government defines energy in “megawatt hours,” or MWh. One Dakotas, taking advantage of a high-water year in the Missouri River basin. MWh is 1 million watt hours.

Montana North Dakota South Dakota Minnesota Wisconsin Production Production Production Production Production 2009: 9,505,940 MWh 2009: 1,475,251 MWh 2009: 4,432,451 MWh 2009: 809,000 MWh 2009: 1,393,988 MWh 2010: 9,230,000 MWh 2010: 2,042,000 MWh 2010: 5,765,000 MWh 2010: 752,000 MWh 2010: 1,392,000 MWh Percent of total electricity Percent of total electricity Percent of total electricity Percent of total electricity Percent of total electricity production from hydro production from hydro production from hydro production from hydro production from hydro (2009): 35.6 percent (2009): 4.3 percent (2009): 54.1 percent (2009): 1.5 percent (2009): 2.3 percent

Sources: U.S. Energy Information Administration