National Hydropower Association: News and Updates – Part 1

The National Hydropower Association (NHA) is a non-profit national association dedicated to promoting the growth of clean, affordable hydropower in the U.S. It seeks to secure hydropower’s place as a climate-friendly, renewable and reliable energy source that serves national environmental, energy and economic policy objectives.

The following pages provide news and information from NHA, including an annual report on the association’s activities in 2012, its efforts to promote hydropower, and more.

2012: A Year in Review

NHA was very active in promoting hydropower in 2012, focusing on the value of existing generation and securing new growth and development.

Ushering in a new era for hydropower

NHA has dedicated itself to strengthening the hydropower industry for the 30 years it has served as the industry advocate. That commitment was stronger than ever in 2012 as NHA marshaled the collective efforts of our industry to achieve key initiatives to bring hydropower policy to a modern age.

NHA’s goal is simple: bring additional value to our members while serving as the industry’s collective voice to bring change. From piloting an industry-wide operational event reporting system to launching a multi-stakeholder initiative to expedite hydro licensing, from aggregating efforts to create the next generation hydropower workforce to improving market recognition of hydro’s benefits, NHA is working for you!

It’s clear that hydropower, both existing generation and new development, will play a pivotal role in America’s clean energy future. NHA is working aggressively to advance that recognition. First, by expanding this available, reliable, affordable and sustainable resource, we will drive our economy, providing new jobs and additional renewable energy. To make that vision a reality, NHA has helped advance hydropower bills through Congress and secured more favorable financial incentives for hydropower project development. Second, through NHA’s work to secure policy reinvestment in existing generation, hydropower’s unique electric attributes will continue to serve our nation, ensuring grid stability and energy security, and help our nation transition to cleaner energy choices. NHA is driving a new discussion among policymakers on hydropower and its many important benefits.

These are exciting times for hydropower. There has been much accomplished in 2012, yet much work lies ahead in 2013. We know we can count on the continuing engagement of NHA’s members and the collective hydropower industry as we drive to complete new supportive hydropower legislation, achieve regulatory improvements, raise hydropower’s profile, secure greater opportunities for market value, and promote operational excellence among industry’s finest operators – federal and non-federal.

Promoting our existing hydropower resource

Hydropower has a rich history in the U.S. that spans 130 years. From the very first project developed on the Fox River in Wisconsin in 1882 to new developments currently being built on the Ohio River, hydropower has served as a clean, renewable engine of growth for the American economy. It powered our country through some of its most difficult times, including the Great Depression and World War II. Today, hydropower’s role is just as vital as it was then. Its unique electric benefits, the flexibility it offers for grid stability and energy security are more important than ever.

Although there is room for hydropower to expand its contributions, it is already the largest source of renewable electricity in the U.S., generating nearly twice as much power as all the other renewable resources combined. Once more, hydropower’s ability to operate as peak energy or as a baseload or load following resource sets it apart from its renewable brethren. NHA believes a resource this large and unique must be preserved for the benefit of future generations.

NHA has worked to ensure the industry has the tools it needs to keep hydropower on top as a reliable, affordable and sustainable renewable energy resource. This is especially important as more than 20% of our existing hydropower resource awaits or will go through relicensing by the Federal Energy Regulatory Commission (FERC) in the next 10 years. Through engaging with regulators and advocating hydropower’s value, connecting the industry, and promoting the operating performance of the existing hydropower fleet, NHA continues to support and promote hydropower’s contributions to America’s power grid.

Over the past few years, NHA has worked with industry members to identify the key challenges before it.

Hydropower licensing remains a continuing concern among NHA members, whether relicensing or building new projects. As such, NHA has brought together a broad group of stakeholders to consider policy improvements to address the regulatory challenges our existing fleet, and new development, faces.

The Hydropower Policy Review Working Group first met in the fall of 2012 – comprised of NHA, American Rivers, Trout Unlimited, The Nature Conservancy, Union of Concerned Scientists, the American Council on Renewable Energy, the Theodore Roosevelt Conservation Partnership, Third Way, and the American Action Forum. Group members are working together with the common beliefs that America needs more low-carbon energy. The goal is to achieve common sense reforms that allow for an expedited process while preserving and building on habitat and water resource protection.

The regulatory challenge is only one of the major concerns voiced by NHA members over this past year. Securing market value for hydropower, its storage capabilities, and its ancillary services is another prime issue. NHA recognizes that policy makers at the federal and state level need to better understand the full suite of benefits that hydropower offers, including creating a more reliable electricity grid. They also need to understand how state and federal policy can negatively affect hydropower’s value and the critical role this technology plays in balancing the system. To educate and build regional approaches, NHA launched a Markets Initiative in the summer of 2012 to bring industry members together and discuss potential solutions grounded in regional differences and regional needs.

Through our committees and these special initiatives, NHA has launched a new era for the hydropower industry. Our policy work is important, but the opportunities to share experiences and unite the industry are equally valuable.

This year, NHA continued to provide our membership of nearly 200 companies opportunities to bring its collective knowledge and experience to bear on the industry through an ever-diverse program of meetings and tools that facilitate information sharing. By offering these opportunities, NHA seeks to constantly raise the industry’s standard of performance, raise hydropower’s profile among state and federal energy discussions, and provide an invaluable opportunity to learn from one another, whether members are new to hydropower or have decades of experience.

From Washington, D.C., to Sitka, Alaska, NHA held meetings in all corners of the country in 2012, connecting more than a thousand industry members with policy makers, regulators, business leaders and one another. With a record average attendance of nearly 100 at each of the four programs offered in 2012, the regional meetings program brought tremendous value by uniting industry to focus on specific regional issues and learn more about how Washington, D.C., and the policies under consideration will affect their operations. Our 2012 Annual Conference was one of the largest gatherings of NHA members to date, with the highest number of first-time attendees and non-member companies in attendance.

NHA is committed to bringing more opportunities for industry to learn from one another and promote the highest standards. Throughout 2012, NHA significantly advanced the Operational Excellence Initiative begun last year (for more information on this initiative, see page 60), which is composed of industry members and charged with identifying the resources needed to achieve a high level of operational excellence at hydropower facilities. To this end, NHA developed and launched a pilot Event Reporting system to provide the industry a forum for sharing information on significant operations, maintenance and environmental events through a central database. This information exchange will lead to valuable lessons learned and the development of best practices.

Our committee listservs continue to provide real-time information on policy issues before the industry. Our Hydraulic Power Committee retreat brings nearly 100 operators together each year to share invaluable operation and maintenance solutions, which results in reduced liability and cost savings.

Improving hydropower’s growth opportunity

The U.S. hydropower industry is a vibrant, growing part of the American energy economy. Hydropower provides tremendous benefits to our nation’s electricity portfolio and has the potential to contribute even more as our nation grapples with its energy challenges. More than 60,000 MW of hydro capacity could be developed in the next 15 years with the right policies in place, all while creating more than 1 million new jobs in the U.S. This growth potential, along with hydropower’s job creation opportunities, makes hydropower very attractive to policymakers. Why? Because hydropower is clearly part of the solution in moving our nation toward cleaner energy choices – a major goal for this administration.

That’s why NHA has been working to improve the regulatory and financial environments for new hydropower development through sustained outreach to key policy makers and opinion leaders in Washington, D.C.

In 2012, NHA released the first-ever U.S. Hydropower Supply Chain Snapshot (see Figure 1). This fully interactive online map demonstrates that our industry supports a thriving domestic supply chain that benefits regions and communities across the country.

hydropower supply chain snapshot

The U.S. Hydropower Supply Chain Snapshot features more than 2,500 companies in the non-federal hydro supply chain. The companies include small, medium and large firms and range from project developers to construction companies, engineering firms to electricians, and component manufacturers to biologists.

The snapshot clearly shows that smart, targeted federal policies to provide incentives for investment have paid dividends around the country. It also shows what is at risk if Congress fails to provide a stable, predictable policy environment for hydropower moving forward.

To make our growth goals a reality, NHA advanced legislation to make commonsense improvements to the federal hydropower regulatory process for small, conduit, incremental and pumped storage technologies. The Hydropower Regulatory Efficiency Act of 2012, introduced by Representatives Cathy McMorris Rodgers (R-WA) and Diana DeGette (D-CO), passed the House of Representatives unanimously in July, following swift committee consideration. This was the only energy legislation of the 112th Congress to receive wide-ranging support and move so quickly. The politics of hydropower are clearly changing. The groundwork NHA has laid over the past several years through stakeholder engagement and aggressive outreach offers new opportunities for bipartisan policies to promote the preservation and growth of our industry. (For more information on this legislation, see the article on page 32.)

hydropower growth potential by 2025

Amplifying the industry’s call for these legislative improvements was a top priority for NHA. NHA aided industry members and congressional champions in placing opinion pieces in key state and Washington, D.C., publications – including POLITICO, The Denver Post, and The Oregon Register-Guard – calling on the Senate to send hydropower legislation approved by the House to President Obama’s desk by the end of the year.

Although the Senate’s focus in the final months of 2012 was centered on the nation’s fiscal challenges and it was unable to take up the regulatory bill, NHA’s work raised the profile of hydropower as a bipartisan energy solution. Recognizing the strong industry and stakeholder support behind these measures, incoming Senate Energy Chairman Ron Wyden (D-OR) vowed to work with Ranking Member Lisa Murkowski (R-AK) to move hydropower regulatory changes this year in the 113th Congress.

FERC Pipeline

In addition to regulatory improvements, strong financial incentives continue to play an important role in the decision-making process of developers across the country. In fact, dozens of projects and nearly $500 million worth of investments were put at risk by the uncertainty over whether or not the production tax credits and investment tax credits would be extended past their expiration at the end of the year. NHA brought together renewable energy and other base-load and dispatchable energy technologies – including biomass, geothermal, and waste-to-energy – to advocate for changes in the qualifications for key renewable energy incentives.

Through meetings with personnel in key federal offices and increased media outreach in the heat of summer, NHA was able to secure language in the Senate Finance Committee’s tax extenders bill modifying the qualifications for the PTC/ITC to a “start construction” deadline from a “placed-in-service” deadline, which would allow additional time for hydropower projects to qualify.

NHA’s hard work was met with success in the waning hours of 2012, as lawmakers wrestled with the impending “fiscal cliff.” The PTC/ITC modification was included in the final bill passed on New Year’s Eve.

With financial incentives secure for another year and groundwork laid for action on hydropower legislation in the 113th Congress, the hydropower industry is certainly in a stronger position to expand America’s top renewable resource in the years to come.


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