Energy Firms Show New Interest in Pittsburgh’s Hydropower
Potential
Pittsburgh Business Times
4 May 2012
By Anya Litvak, Reporter
A new slate of companies are vying for hydropower projects in the
region, replacing previous candidates who thought they could make
such projects work but later dropped their efforts.
It’s been a pattern in the Pittsburgh district. “They come and
go,” said Jeff Benedict, hydropower coordinator at the Pittsburgh
District of the U.S. Army Corps of Engineers, noting the last time
a new hydropower plant came online in this area was in the late
1980s.
The reality of long licensing times and “thousands of dollars” in
feasibility and engineering studies has stifled the interest of
several companies over the past several years, Benedict said.
Still, he’s “cautiously optimistic” that vibrant interest from
several newcomers may bring new projects online.
Hydropower plants use the kinetic energy of flowing water to power
a turbine that creates electricity.
Two years ago, interest in this area’s hydropower potential was
dominated by Massachusetts-based Brookfield Renewable Power, which
proposed 14 projects.
When it abandoned them in July 2010, saying it couldn’t justify
the economics, there was a brief lull in proposals that evolved
into a competition between several out-of-state firms.
Today, there are six companies looking at sites in southwestern
Pennsylvania and evaluating projects totalling 213 megawatts of
capacity. Half of them are new on the scene: Boston-based Free
Flow Power Corp., Utah-based Symbiotics Energy and
Minneapolis-based Nelson Energy Inc.
Free Flow Power has set its sights on seven locks and dams along
the Monongahela, Allegheny and Ohio rivers in Pennsylvania, as
well as Crooked Creek in Armstrong County and two sites in West
Virginia.
The company was founded in 2007, born out of the vision that
hydropower was the largest and most overlooked renewable
technology in the market today, said Jon Guidroz, director of
project development.
Free Flow took an inventory of available sites and saw
southwestern Pennsylvania as fertile ground for hydropower
development, made more attractive by certain federal tax
incentives, including the soon-to-expire renewable energy
production tax credit and the investment tax credit.
Guidroz said the earliest construction could begin at the
southwestern Pennsylvania sites is 2015.
High Hopes From the Feds
In a recent report assessing the hydropower potential of
unpowered dams, the Department of Energy found Pennsylvania to be
among the most promising states for new development, with what it
believes is 679 megawatts of capacity yet to be tapped.
About 75 percent of that is concentrated in southwestern
Pennsylvania along the area’s three rivers. The sites with the
most promise, according to the report, are Montgomery Locks and
Dam in Industry, which has the potential to generate 99.8 MW, and
the Emsworth Locks and Dams in Emsworth, with 84.4 MW of
potential.
In general, Benedict thinks the DOE’s assessment is “on the high
side” of what has been proposed in the past.
The Montgomery Locks and Dam is a case in point. Doug Spaulding,
president of Nelson Energy, which is pursuing an evaluation of the
site, thinks what’s feasible is about half the federal estimate.
Factors such as the siting of the powerhouse and making sure
hydropower doesn’t interfere with Corps navigation have the
potential to adjust the capacity size of the project, he said.
“The answer to that question is at the end of a bunch of
preliminary engineering studies,” Spaulding said, and the company
plans to decide within the next month if it will start putting
money into those studies or drop the project, which could carry a
capital cost of nearly $200 million.
Licensing a hydropower project in this region involves securing a
series of permits from federal, state and municipal officials, and
can take more than six years, according to Benedict. Most
companies that express initial interest in developing never follow
through on it.
“I can certainly sympathize there’s a lot of permitting involved,”
he said.
Take Mahoning Creek Hydropower, a project that’s furthest along
the development spectrum in this region. Owned by Ohio-based
Advanced Hydro Solutions LLC, the 6 MW proposed plant was fully
licensed by FERC more than a year ago, but has been delayed by
negotiations with the Corps and the DEP over water quality
parameters.
The estimated construction cost has gone from $12.5 million to $15
million over the past several years, and the construction start
date will not be this month, as planned, said Advanced Hydro
Solutions President David Sinclair, whose firm has been pursuing
the project since December 2005.
Anya Litvak covers energy, transportation, gaming and accounting.
Contact her at alitvak@bizjournals.com or (412) 208-3824.