U.S. sees spike in hydropower project applications

Spurred by federal and state incentives, U.S. developers proposed hundreds of new or expanded hydroelectric projects to the Federal Energy Regulatory Commission during 2008. Many of the notices and orders issued by FERC were for unconventional hydrokinetic projects proposed for the Mississippi, Missouri, and Ohio rivers, and for offshore ocean sites.

FERC issued about 390 notices and orders involving preliminary permits, licenses, and amendments signifying growth in development activity in 2008.

Of those, the commission issued more than 240 preliminary permits during 2008, representing proposals to develop 15,460 MW of new installed capacity. That’s nearly five times the 50 preliminary permits issued for all of 2007.

FERC said it issued 120 preliminary permits during 2008 to developers wanting to study proposed hydrokinetic projects. It issued about three dozen preliminary permits for hydrokinetic projects in 2007 and just one in 2006.

At the end of 2008, FERC records showed the commission had formally accepted another 60 preliminary permit applications totaling 9,800 MW, but had not yet acted on them. At least half of those were applications to study hydrokinetic projects.

The preliminary permit, the first step in the hydro licensing process, does not allow construction. Instead it maintains the permit holder’s priority over potential competitors to apply for a development license. The permit holder has three years to study a site and makes financial arrangements necessary to apply for a license.

Incentives spur record hydro developer interest

In a presentation last April, a FERC official described the hydro activity as the highest level of developer interest in more than a decade. (HNN 5/19/08) At that time, Kim Nguyen of FERC’s Office of Energy Projects attributed the 10,000 MW in projects before FERC to renewables tax credits, state renewables portfolio standards, and the high cost of oil.

In October, Congress renewed expiring production tax credits for renewable energy including incremental hydropower resulting from additions or upgrades to existing hydro plants, and hydroelectric projects installed at non-hydropower dams. (HNN 10/3/08) It also expanded the list of eligible renewables to include ocean, tidal, and in-stream hydrokinetic technologies. It also extended the Clean Renewable Energy Bond program for renewable energy projects by public power utilities.

Developers also have benefitted from guidance and incentives from agencies such as FERC (HNN 4/16/08) and the Department of Energy. (HNN 1/7/09) In addition to federal incentives, dozens of states have adopted renewables portfolio standards benefitting hydropower. (HNN 11/19/08)

The number of filings for preliminary permits could increase yet again in 2009, given the federal government’s support for renewables. An $825 billion economic stimulus package unveiled by House Democrats contains billions of dollars in tax breaks for renewable energy and spending for energy efficiency and transmission. (HNN 1/16/09)

Big rivers, ocean feature in hydrokinetic filings

Developers granted permits in 2008 to study hydrokinetic projects include Free Flow Power Corp. (HNN 6/9/08), which is pursuing river-current projects in the Mississippi, Missouri, and Ohio rivers. Hydro Green Energy LLC, another developer, holds permits to study river-current projects in New York, Alaska, and in the Mississippi River. Hydro Green recently installed a hydrokinetic power unit at the city of Hasting’s 4.4-MW Mississippi Lock and Dam No. 2 project in Minnesota. (HNN 12/16/08)

Another developer, Grays Harbor Ocean Energy Co. LLC, filed preliminary permit applications with FERC in October 2008 to study the feasibility of ocean wave energy projects off the coasts of six states: California, Hawaii, Massachusetts, New Jersey, New York, and Rhode Island. FERC granted the company a preliminary permit for another project, 6-MW Grays Harbor Ocean Energy (No. 13058), in the Pacific Ocean off the coast of Washington, in 2008. Pacific Gas &Electric Co. already holds permits to study two 40-MW ocean wave projects in California. (HNN 10/17/08)

Hydropower operator Brookfield Power created affiliate BPUS Generation Development LLC in 2008 to expand its development of new projects. (HNN 1/3/08) During 2008, the company received preliminary permits to study more than two dozen projects totaling 467 MW. BPUS Generation also is pursuing development of pumped-storage projects. It filed applications for preliminary permits in 2008 for the study of several pumped-storage projects, including 1,040-MW Banks Lake (No. 13296), 1,150-MW Duffey Lakes (No. 13295), 1,340-MW Little Potlatch Creek (No. 13303), and 1,100-MW Umtanum Ridge (No. 13304). Those applications are pending.

Canada incentives advance new hydro development

Hydropower development activity in Canada remains strong, partly due to incentive programs, especially in British Columbia. In response to BC Hydro’s Clean Power Call for projects, developers recently proposed 45 hydropower projects representing 8,700 gigawatt-hours of annual generation. (HNN 12/4/08)

Canada’s new Natural Resources Minister Lisa Raitt met the Canadian Hydropower Association in November, pledging to promote hydropower development. (HNN 11/24/08) Ontario’s Ministry of Natural Resources acted in December to extend indefinitely the deadline for new applications for waterpower site development. (HNN 12/10/08) MNR provides opportunities to develop sites on government-owned land where no dams exist, and allows use of existing government dams for hydro generation.

New hydro projects are advancing across Canada, including the 100-MW Dunvegan project in Alberta (HNN 1/5/09), 200-MW Wuskwatim in Manitoba (HNN 12/4/08), 2,824-MW Lower Churchill in Newfoundland and Labrador (HNN 1/13/09), the 464-MW Lower Mattagami redevelopment in Ontario (HNN 9/17/08), and the 1,550-MW Romaine complex in Quebec (HNN 11/20/08).

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