Hydropower Resource Assessment at Existing Reclamation Facilities

Executive SummaryConclusionsThe Resource Assessment concludes that substantial hydropower potentialexists at Reclamation sites. Some site analyses are based on over 20 years ofhydrologic data that indicate a high likelihood of generation capability. TableES-3 presents 70 of the 530 sites that could be economically feasible to developbased on available data and study assumptions; of which 36 sites used highconfidence data for the analysis.The results of the Resource Assessment will be of value to public municipalitiesand private developers seeking to add power to their load area or for investmentpurposes. It provides a valuable database in which potential sites can be viewedto help determine whether or not to proceed with a feasibility study. For manyof these Reclamation sites, development would proceed under a Lease of PowerPrivilege Agreement as opposed to a Federal Energy Regulatory Commission(FERC) license. A lease of power privilege (lease) is a contractual right of upto 40 years given to a non-Federal entity to use a Reclamation facility forelectric power generation. It is an alternative to federal power developmentwhere Reclamation has the authority to develop power on a federal project. Theselection of a Lessee is done through a public process to ensure fair and opencompetition though preference is given through the Reclamation Project Act of1939 to municipalities, other public corporations or agencies, and also tocooperatives and other nonprofit organizations financed through the RuralElectrification Act of 1936. In order to proceed under a lease, the project musthave adequate design information, satisfactory environmental analysis/impacts,and cannot be detrimental to the existing project. Some sites in the analysis arealready being pursued by public or private entities. Reclamation does not intendto interfere with existing plans for site development. Reclamation selected sitesfor this analysis that do not have existing hydropower facilities; although somemay have FERC preliminary permits issued. The reports notes sites that have aFERC preliminary permit issued or are being pursued by other means.The results could also be used to support an incentive program for hydropoweras a renewable energy source. A large number of projects fall in the gray areaof being economically feasible. The Resource Assessment shows that greenincentives for hydropower development are largely not available in individualstates, but, when they are, can contribute substantially to the economic viabilityof a project. For example, state-sponsored programs in Arizona and Californiacan, in some instances, double the benefit cost ratio for a site. Washington alsohas a green incentive program that can contribute to the economic viability ofhydropower development. For the 14 remaining states, renewable energyincentives for hydropower are not available at the state level. A Federalincentive program exists, but does not contribute significantly to economicbenefits. Further, if sites are developed by Reclamation, they would not beeligible for the Federal incentive, but could qualify for state-sponsoredincentives. This analysis could be useful in promoting hydropower at existingES-6 – March 2011