Hydro Currents

Senate bill would enhance hydro incentives

Sen. Maria Cantwell, D-Wash., introduced legislation that would expand incentives to hydro project developers, including a long-term extension of the renewables production tax credit and Clean Renewable Energy Bond (CREB) program. Under current law, a facility qualified to apply for production tax credits must begin service by Dec. 31, 2008. Cantwell’s bill would extend that five years to 2013. Additionally, all qualifying facilities would receive the full rate of credit; current law reduces the credit by half for technologies including hydropower, to 0.9 cent per kilowatt-hour. The bill also would make “zero carbon emissions resources,” including ocean, tidal, and instream kinetic technologies, eligible. The bill offers similar provisions for the Clean Renewable Energy Bond program so that consumer-owned utilities, which cannot benefit from tax credits, receive an extension of the time to invest. Cantwell’s bill also would boost the limitation on bonding authority. Bonds issued before Jan. 1, 2009, would have a limitation of $1.2 billion; bonds issued after Dec. 31, 2008, and before Jan. 1, 2014, would have an annual limitation of $5 billion.

Bill: Existing dams could be modified

Sen. Cantwell’s production tax credit bill also would ease restrictions on the modifications an eligible developer may make to an existing non-power dam when adding hydro generating equipment. Currently, the law prohibits enlargement of a diversion structure; construction or enlargement of a bypass channel; or any impoundment or withholding of additional water from the stream. To make addition of generating equipment more feasible, the bill would allow enlargement of a diversion structure or construction or enlargement of a bypass channel if it is done in compliance with a Federal Energy Regulatory Commission hydro license.

Buffett defers to FERC on Klamath dams

Multi-billionaire Warren Buffett told protesters it is up to federal and state regulators, not his investment company, whether utility PacifiCorp removes hydroelectric projects from the Klamath River in Oregon and California. Indian tribal elders and commercial fishermen traveled to Omaha, Neb., to protest the dams during a May 5 shareholders meeting of Berkshire Hathaway, Buffett’s investment firm, which recently acquired control of PacifiCorp via its MidAmerican Energy unit. PacifiCorp is attempting to relicense the 161.338-MW Klamath project before the Federal Energy Regulatory Commission (FERC). Two speakers who were allowed into the shareholders meeting called on PacifiCorp to remove the dams. Buffett said it was beyond his power to compel PacifiCorp to remove the dams. “That is entirely a question for FERC and the state commissions… PacifiCorp will do exactly what they say,” he said.

Ontario streamlines hydro site releases

Ontario’s Ministry of Natural Resources (MNR) is acting
to reduce the complexity, cost, and administrative burdens on developers who propose small hydro projects on government land. MNR supports new hydropower generation by providing opportunities to develop sites on government land where no dams currently exist, and by using existing government-owned dams for generation of electricity. The province amended its Waterpower Site Release and Development Review Policy and its Waterpower Site Release and Development Review Procedure, effective in May. Although Ontario’s 2004 policies contemplated a fully deregulated electricity market, the expected amount of competition has not occurred. As a result, developers, aboriginal communities, and staff have found that for smaller sites, MNR’s site release process has been time-consuming, onerous, and expensive. “The administrative changes undertaken will provide a more efficient process for the waterpower industry, aboriginal communities, and staff,” MNR said.

Panel sends FERC nomination to full Senate

The Senate Energy Committee sent the name of Commissioner Joseph Kelliher to the full Senate for a confirmation vote on a second term on the Federal Energy Regulatory Commission (FERC). The name of Kelliher, FERC’s chairman, was moved out of committee by voice vote May 23. Although there was no roll call, Sens. Maria Cantwell, D-Wash., and Jon Tester, D-Mont., asked that they be recorded voting against advancing the nomination. Senate Majority Leader Harry Reid, D-Nev., will determine when to bring the nomination to a vote. President Bush named Kelliher, a Republican, in March to serve another five-year term, and to continue as chairman.

GE Financial to double investment in renewables

GE Energy Financial Services announced plans May 24 to double its renewable energy investments by 2010, including its investment in Plutonic Power Corp.’s 196-MW East Toba River and Montrose Creek hydro project in Canada. GE Energy Financial Services, a unit of General Electric, said the expanded investment target would increase the share of renewable energy in its overall portfolio to nearly 20 percent, or $4 billion, by 2010. GE said investments in East Toba River and Montrose Creek, and a 209-MW wind energy project in Texas would help it reach its target. The company first disclosed plans to invest in the British Columbia hydro in 2006. It now says it will invest up to C$112 million (US$103 million) to acquire 49 percent equity and 60 percent economic interest in the project. GE and Manulife Financial also are leading a C$466 million (US$430 million) debt offering to finance the project. The company also said it would make C$30 million (US$27.7 million) of credit available to Plutonic to increase the capacity of a transmission line. That is to pave the way for Plutonic to self-finance construction of three more Toba River Valley projects totaling 116 MW.

FPL to build fish passage at four Maine projects

FPL Energy Maine Hydro LLC agreed to install upstream fish passage at four more of its hydroelectric projects on the Saco River in southern Maine. FPL Energy, which already built upstream passage at two other projects, also will provide measures for passing American eel at its projects in the basin. The licensee’s plans are part of a settlement agreement filed with the Federal Energy Regulatory Commission. The agreement addresses passage and fisheries management at six projects. It calls for upstream fish passage at 4-MW Bar Mills, 7.812-MW West Buxton, 7.2-MW Bonny Eagle, and 10.9-MW Hiram, sequentially, beginning in 2016. Permanent facilities would be provided as returns of anadromous species increase substantially. In the meantime, trap and haul of adults from fish lifts at 6.65-MW Cataract and 16.8-MW Skelton would continue to provide passage and access to upstream reaches for target species.

Senate eyes renewables portfolio with hydro

Senate Energy Committee Chairman Jeff Bingaman, D-N.M., said he would offer an amendment on the Senate floor to impose a renewables portfolio standard that would require, by 2020, that 15 percent of U.S. electricity supplies be generated by renewable energy sources. Eligible renewables under the amendment would include incremental hydropower installed at existing hydro plants or water resources facilities and energy from wave, tidal, or other ocean-powered projects. Existing hydropower projects would not be eligible. Bingaman said he would offer the amendment to a bill proposed by the Energy Committee that would improve energy efficiency, promote renewable fuels, and invest in research on carbon sequestration.

Alcoa pledges to back Alcan hydro deals

U.S. aluminum giant Alcoa Inc., which is pursuing a US$28 billion takeover of Canada’s Alcan Inc., promises to meet Alcan’s investment obligations that are linked to favorable hydropower concessions from the province of Québec. “Alcoa and Alcan together are uniquely qualified to assume stewardship of the hydro resources and other natural resources currently under Alcan’s ownership, control, direction, and influence in Québec,” Alcoa told Alcan’s board. Alcoa said it would continue Alcan’s Québec and global expansion projects. Alcan’s hydropower facilities in Québec total 2,687 MW. Alcan has a preferential power rate under long-term contracts with Québec government-owned utility Hydro-Québec, and waterways rights that are key to its ability to economically produce aluminum in the province. Alcan also owns facilities in British Columbia, including the 896-MW Kemano hydroelectric project.

Congress examines ocean power opportunities

Officials told a congressional hearing there are plenty of opportunities to develop renewable energy in the oceans off U.S. shores. Ten panelists testified in April. Michael Olsen, deputy assistant secretary for Land and Minerals Management for the Department of Interior, said interest in alternative energy development on the Outer Continental Shelf is growing, particularly in the Northeast and along the West Coast. Olsen said Interior’s Minerals Management Service (MMS) is working with the Federal Energy Regulatory Commission (FERC) to coordinate project review and authorization. FERC has jurisdiction over hydropower licensing, while MMS has authority over offshore energy development on the Outer Continental Shelf. Director Ann Miles of FERC’s Division of Hydropower Licensing said ocean-based hydro eventually could double U.S. hydropower production. She cited an Electric Power Research Institute study that estimates the potential for wave and current power in the U.S. to be more than 350 billion kilowatt-hours annually.

Oregon utility to remove 21-MW Bull Run

Oregon utility Portland General Electric (PGE) is preparing for the biggest dam removal in Oregon history with the decommissioning of its 21-MW Bull Run hydroelectric project in mid-2007. Deconstruction of the 47-foot-tall Marmot Dam on the Sandy River is to begin no later than August and last about four months, PGE said. A second dam, 16-foot-tall Little Sandy Dam, will be decommissioned in 2008. The utility decided the likely cost of environmental protection, mitigation, and enhancement measures would make continued operation uneconomical.

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