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Interior Reports Details Potential for Expanding
Hydro Energy at Existing Northwest Dams

by Staff
Columbia Basin Bulletin, April 1, 2011

The Department of the Interior this week released the results of an internal study that shows the department could generate up to one million megawatt hours of electricity annually and create jobs by adding hydropower capacity at 70 of its existing facilities, including those in the Northwest.

The report, "Hydropower Resource Assessment at Existing Reclamation Facilities," estimates that the additional hydropower capabilities could create enough energy to annually power more than 85,000 households. Based on industry estimates for job potential associated with the kind of hydropower additions identified in this report, approximately 1,200 jobs could be created, say Interior officials, including jobs in administration, manufacturing, construction, engineering, operations and maintenance.

"Adding hydropower capability at existing Reclamation facilities is a cost-effective and environmentally sustainable way to build our clean energy economy," said Assistant Secretary for Water and Science Anne Castle. "We can increase our renewable hydropower output without building new dams. This report highlights the exciting potential for substantial hydropower development and related jobs at existing facilities throughout the western United States."

The Bureau of Reclamation developed the report as part of President Obama's initiative to develop a comprehensive renewable energy portfolio and to meet 80 percent of our energy needs with clean sources by 2035.

"Our report reflects Reclamation's commitment to advancing renewable energy in a manner that promotes efficiency and sustainability through the use of existing resources," said Reclamation Commissioner Mike Connor.

The report studied 530 sites throughout Reclamation's jurisdiction -- including dams, diversion structures, and some canals and tunnels. Of those sites, the assessment made a preliminary identification of 70 facilities with the most potential to add hydropower. These 70 facilities are located in 14 states.

Colorado, Utah, Montana, Texas and Arizona have the most hydropower potential. Facilities with additional hydropower potential are also found in California, Idaho, Nebraska, Nevada, New Mexico, Oregon, South Dakota, Washington and Wyoming.

The chart at shows a state-by-state breakdown of the 70 sites with the greatest potential to develop additional hydropower and contribute energy to the grid. It indicates potential installed capacity, annual production and a benefit-cost ratio that incorporates incentives for developing energy available from existing federal and state programs.

Connor explained how the report can best be used.

"Although this report is not a feasibility analysis, it provides information that allows Interior and developers to prioritize investments in a more detailed analysis that focuses on sites demonstrating reasonable potential for being economically, financially and environmentally viable," he said.

Connor pointed out that for many of these sites, hydropower development would be conducted under a "Lease of Power Privilege Agreement" through which a non-federal entity is given a contractual right for up to 40 years to use a Reclamation facility for electric power generation

Reclamation will be publishing two Federal Register notices in the near future regarding Lease of Power Privilege opportunities at Granby and Pueblo dams in Colorado. These dams were identified in the report as having high potential for hydropower development.

A related product that Reclamation is making publicly available is the Hydropower Assessment Tool that was used in the report to analyze the 530 sites. The tool can be applied to any potential hydropower site and requires simple inputs of daily flows, head water elevations and tail water elevation. The results provide valuable information on potential hydropower production and economic viability.

The Bureau of Reclamation is the largest wholesale water supplier and the second largest producer of hydroelectric power in the United States, with operations and facilities in the 17 Western States. Its 58 power plants annually produce, on average, 40 billion kilowatt-hours per year, enough to meet the needs of 9 million people.

Related Sites:
Assessment of Potential Capacity Increases at Existing Hydropower Plants Department of Interior, October 2010

Executive Summary

There has recently been a considerable resurgence of interest in hydropower in the USA. The current interest in hydropower has been primarily directed at developing incremental hydropower where an existing dam, or an existing dam and powerhouse can be utilized. Incremental hydropower can be developed through efficiency increases in existing units and/or by the addition of capacity to utilize flow for generation that would be otherwise spilled at existing dams. One of the driving forces behind the increased interest in electricity generation from hydropower plants is that greenhouse gas (GHG) emissions from hydropower are virtually zero when compared to thermal generation from fossil fuels. Additional clean hydropower generation would offset or reduce GHG emissions from fossil fuel-fired generation.

Reclamation has 58 existing hydroelectric plants with a total installed capacity of about 15,000,000 kilowatts (kW) (15,000 megawatts [MW]). This report assesses the potential for capacity increases at the 58 existing hydroelectric plants that could potentially generate additional power.

Also included in the report is an estimated quantification of incremental energy increases from efficiency gains that would result from replacement of older turbine runners with new runners of modern design. A final task involves the estimation of potential GHG offsets that could be credited to the incremental energy increases or the avoidance of outages at the existing plants.

Due to the large number of plants involved, these studies were performed at the planning-level (reconnaissance-level)) for purposes of screening between plants. Additional more detailed feasibility-level studies of individual plants would be needed to make final investment decisions at those specific plants that show promise for capacity additions in this study.

Because the "best" capacity addition from an economic standpoint was not known in advance, five capacity additions of different sizes were tested for each plant. The capacity additions tested at each plant were 10%, 20%, 30%, 40%, and 50% of the existing combined nameplate capacities (the installed capacity). For each of the alternative capacity additions, a benefit to cost ratio (BCR) and a net present value (NPV) were determined.

The preferred capacity addition would have either the maximum benefit to cost ratio (if it was greater than 1.00) or the maximum net present value (if positive).

The determination of benefits from a capacity addition requires the estimation of the average incremental energy generation, which is developed with a hydroelectric energy simulation model. An energy model was developed that could simulate up to 30 years of daily energy generation at each of the 58 existing plants. Plant specific input data to the energy model was supplied by Reclamation that included reservoir outflows and elevations, and many characteristics of the existing hydroelectric plants. Results generally showed reasonable agreement between the simulated and recorded generation, which satisfactorily validates the model.

In addition to the energy generation in megawatt-hours (MWh), the value of energy ($/MWh) and capacity ($/kW-yr) must be known to determine the total benefits of a capacity addition. The value of energy was developed on a regional basis for each of the plants based on information obtained from the Energy Information Administration, Department of Energy. The value of energy was separated into on-peak and off-peak hours. The value of capacity was also developed based on information obtained from the Energy Information Administration, Department of Energy and is a variable function of the relative amount of energy associated with each capacity addition, so the more incremental energy, the higher the capacity value.

An estimate of the costs associated with each plant capacity addition was necessary to evaluate the benefit to cost ratios and net present values. The cost estimates included construction, mitigation, and operation and maintenance costs. The cost estimating methodology was taken from a 2007 Federal report (U.S. Department of the Interior, et al, 2007), known as the 1834 study, on potential hydroelectric development at existing Federal facilities. Notably, the 1834 study excluded the 58 existing Reclamation plants that are studied herein because it was thought at that time that with few exceptions, the existing plants were either originally constructed or had already been uprated so that they were then currently sized to the available flow.

Results of this study show that only 10 of the 58 plants have potential capacity additions of any size with positive NPVs, which corresponds to a BCR greater than 1.00 and is an indicator of economic feasibility. The 10 plants that show initial promise for capacity additions (Table ES-1) are mostly among the smallest of the 58 plants. Selecting the capacity addition at each of the 10 plants that has the highest benefit to cost ratio would result in a total capacity addition of about 67 MW. The additional 67 MW capacity would represent less than one-half of one percent of the existing total nameplate capacity of the 58 plants. If maximum NPV was the criterion for selecting the capacity addition (Table ES-2), the economic capacity addition would rise to about 143 MW, still less than one percent of the existing total nameplate capacity. The Palisades hydropower plant has the highest net present value.

It can be concluded that 10 of the 58 plants show some promise for capacity additions that could be investigated in more detail in future studies. But it must also be concluded that if the capacity additions were implemented in the sizes indicated by this planning-level study, the resulting additions would increase the total capacity of the 58 existing Reclamation plants by less than 1%. This conclusion generally supports the assertion in the 2007 Federal study that the existing Reclamation hydroelectric plants are with few exceptions currently economically sized to the available flow.

Additional results presented in detail in subsequent chapters of this report show substantial potential for generation increases from efficiency gains that would result in substantial offsets of greenhouse gasses (GHGs) from fossil fuel-fired generation. Table ES-3 shows the ten plants with the largest opportunities for annual generation increases due to efficiency improvements at the existing units, provided the potential efficiency improvements are at least 3%. One plant in the Pacific Northwest Region, Hungry Horse, and a few plants in the Mid- Pacific Region top the list. A total of 36 plants could potentially increase their annual generation by more than 3%.

In addition to generation increases, three potential ways of achieving GHG offsets were determined. Table ES-4 shows the total GHG offset opportunities for each of the five regions. GHG offsets from efficiency improvements and from capacity increases are based on the capacity addition increment from each plant that yielded the highest BCR. GHG offsets from avoided outages is a concept that was developed as part of the asset investment planning process. Results for individual plants are also presented in Chapter 9, Summary of Results.

Costs and economic benefits were not assigned to the efficiency gains or greenhouse gas offsets in this study. A cost/benefit analysis was not performed for potential efficiency gains because this more detailed level of analysis is performed in the Asset Investment Planning Tool that is included in a separate task under the current overall contract. GHG offsets were not assigned dollar values because there is currently a great deal of uncertainty regarding their future valuation.

Table ES-4. Potential Greenhouse Gas(GHG) Reduction Opportunities by Region

Region GHG Offsets from Incremental
Generation from Efficiency
GHG Offsets from Incremental
Generation from Hydraulic
Capacity Increases
GHG Offsets from Avoided
Energy Losses
  (MWh/yr) metric tons
(MWh/yr) metric tons
(MWh/yr) metric tons
Mid-Pacific 186,818 84,961 187,735 69,129 527,348 243,476
Upper Colorado 81,627 63,134 116,853 67,246 473,221 373,756
Lower Colorado 141,191 79,612 30,833 15,993 77,649 43,783
Pacific Northwest 193,491 106,405 142,011 63,803 398,253 215,777
Great Plains 144,159 77,825 105,692 45,683 584,088 302,024

Interior Reports Details Potential for Expanding Hydro Energy at Existing Northwest Dams
Columbia Basin Bulletin, April 1, 2011

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