Surabhi Karambelkar is completing her PhD in geography at the University of Arizona, minoring in public policy. She is interested in the legal and policy dimensions of interactions of water and energy systems, often termed as the “water-energy nexus.” Her PhD work specifically examines these interactions in the case of hydropower on the Colorado River Basin, where she aims to understand how the different bodies of water and energy laws influence hydropower generation and how they create constraints and opportunities for hydropower operations.
Before beginning her PhD, Karambelkar worked as a consultant for environmental consulting firm ERM. At ERM, Karambelkar worked on numerous social impact assessments, as well as resettlement and livelihood restoration studies in south and southeast Asia. In her time at ERM, she worked on numerous large-scale hydropower projects in Nepal and India, and her passion for hydropower stems from this experience. Karambelkar holds a masters from University College London and has also spent some time working on water issues in Latin America.
When she can’t be found doing research or talking to stakeholders, she can be found hiking in the gorgeous Catalinas in Tucson.
Karambelkar completed her research this month on Hydropower Operations on the Colorado River Basin: Institutional Analysis of Opportunities and Constraints with the support of mentors Linda Church-Ciocci with the National Hydropower Association and Aaron Levine with the National Renewable Energy Laboratory, along with her advisor at the university, Dr. Carl Bauer. Her work focused on the Colorado River Basin, which is facing an unprecedented drought. In ongoing drought management efforts, limited attention has been paid to hydropower generation. While some studies do exist on hydropower, they are quantitative in nature and focus on calculating the reduction in megawatts generated at dams in the basin with declining water availability. These studies simplify the complex process of hydropower generation. Water availability is but one factor that impacts hydropower generation. At a more fundamental level, formal institutional arrangements — that is, laws, policies and rules — create the framework within which dams are operated and hydropower is generated.
This paper conducts a comparative institutional analysis of water, environment and energy laws and policies and changes therein to understand the constraints and opportunities faced by hydropower generation in the Colorado River Basin. To tease out the nuances in how institutional arrangements affect dam operations and hydropower generation, the comparative analysis focuses on the two largest and strategically important dams in the basin: Hoover and Glen Canyon. This paper uses Elinor Ostrom’s institutional analysis and development framework to analyze laws and policies at three levels: constitutional-choice, collective-choice and operational levels. Constitutional-choice level laws and policies apply to the entire basin, whereas collective-choice level and operational level laws and policies are dam-specific.
While water and environmental laws and policies pose constraints for hydropower generation, the analysis in this study further finds that specific historic provisions within energy-related institutional arrangements and recent changes within power contracts have maintained and even enhanced the value of hydropower to power customers. Historic institutional provisions ensure that hydropower is sold “at cost,” making this resource economically competitive with wholesale electricity market rates. Recent power contract modifications have resulted in the amendment of an older resale prohibition clause to expand the flexibility available to power customers in using their capacity and/or energy allocation in regional transmission organizations, independent system operators and bulk power markets. This amendment has opened up an opportunity for customers, especially Hoover power customers, to use flexible generation and ancillary services in a market environment. In addition, the extension of power contract duration to the legally maximum term has enhanced the reliability and stability of this resource for customers.
In the Colorado River Basin, despite the enduring economic responsibility of power customers — where laws require customers to pay for a large portion of construction and O&M costs whether or not they actually receive hydropower — the persistent threat of a drought-induced water shortage, and constraints imposed by water and environmental laws and policies, power customers continue to invest in this resource as energy-related institutional arrangements and power contract provisions protect the reasons why they value hydropower.
Lastly, the analysis in this study finds that the consequences of changes in hydropower generation for energy users, irrigators and environmental programs in the basin depend on how specific institutional arrangements tie electricity revenues to irrigation aid and environmental programs, and how the power contracts themselves are set up. Collective-choice level institutional arrangements create a higher level of financial dependency of irrigation aid and environmental programs on electricity revenues in the Upper Basin — the legal subdivision of the Colorado River where Glen Canyon Dam is located — compared to the Lower Basin — the legal subdivision of the Colorado River where Hoover Dam is located. Therefore, changes in hydropower generation or the way its revenue is collected and used will have far-reaching detrimental consequences for the Upper Basin. Likewise, differences in the nature of power contracts for Glen Canyon and Hoover dams also creates differences in the financial impact incurred by energy users when there is a reduction in hydropower generation. While this study identifies the types of impacts on resource users as a result of specific institutional arrangements, the calculation of extent of impact warrants further attention.
Hydropower in the U.S. is in a unique position today. The strategic importance of this resource for the nation’s electricity sector is rapidly growing even as its contribution to overall electricity generation remains fairly small. This strategic importance, however, is built on hydropower’s ability to operate flexibly in order to support the integration of intermittent renewable generating sources and the expansion of electricity markets. As this study shows, such flexibility may not be available at certain plants not due to the lack of water availability but because of institutional constraints. Institutional arrangements may also require dam operators to first consider high-priority water uses (such as irrigation or environmental needs), which in turn may limit the ability to generate hydropower when it is most valuable or useful.
Engineering and quantitative models, such as production cost models, recognize policy constraints for hydropower operations but often inadequately capture or assume away such constraints in the models. A failure to account for policy constraints in these models runs the risk of inaccurate representation of the operational flexibility and capacity available at specific hydropower plants, which can result in over/underestimation of hydropower’s ability to support the integration of variable renewable resources and address grid reliability concerns. Against this background, this paper and the analysis it contains serves as an example of how we can systematically identify institutional constraints (and opportunities) that influence the flexibility in not only generating electricity at specific dams but also using this hydropower once it is generated.
Karambelkar is completing her PhD over the coming year, and she is excited to begin work in the hydropower industry after her studies are completed. To connect with Karambelkar or learn more about the Research Awards Program, please email firstname.lastname@example.org or visit www.hydrofoundation.org
The Hydro Research Foundation is actively supporting graduate students to conduct research related to conventional and pumped storage hydropower. These students are funded through the U.S. Department of Energy’s Water Power Program and industry partners through a four-year grant.