Smaller hydro sites can have difficulty competing in electricity market
By Michael Hill
Associated Press
WALKILL, N.Y. (AP) — Eat locally. Shop locally. Generate locally?
Some electricity customers in New York’s Hudson Valley support hydropower harnessed from running water close to home.
The idea is similar to farm-to-table, except for electricity instead of food.: green-minded customers supporting an area renewable resource. And smaller hydro plants like those run by Harry Terbush and Sarah-Bower Terbush have a different way to keep their turbines turning.
“It’s community energy, and it allows us to sell directly to customers, and allows them to get a little more benefit of what’s in their backyard,” said Sarah Bower-Terbush.
The husband-and-wife engineers running Natural Power Group have been maintaining hydro sites north of New York City for three decades. The trio of sites they operate now are “run of the river” that rely on flowing water. The steel-encased turbines are modern, but sites have a long history of producing power.
The Wallkill River site once provided mechanical energy for a hat factory. It now can generate 0.5 megawatts — enough power for around 400 homes — by diverting into a short canal that feeds a pair of turbines inside the rebuilt plant.
A larger 2.5-megawatt site across the Hudson River in Wappingers Falls is in a long brick building beneath a fast-falling stretch of Wappinger Creek. Water flows through a 9-foot diameter pipe that snakes across Wappinger Creek to a site that first produced electricity more than a century ago.
“Why not utilize what we have?” Bower-Terbush asked.
But it can be difficult for smaller hydro sites to compete in the electricity market. In New York, plants that generate less than 1 megawatt are currently unable to participate in wholesale markets because of their size. Older hydro sites can miss out on incentives promoting new construction in solar and wind.
And as Matthew Swindle of the hydro company NLine Energy put it: “The challenge is that you can site wind and solar just about everywhere. I can’t put hydro on a rooftop.”
Swindle, who is involved with the National Hydropower Association, said hydro operations are starting to sell to customers in their area by taking advantage of states’ differing energy policies.
In states like California, New Hampshire and New York, it can involve a form of “net metering.”
In New York, Gravity Renewables sells its power from its Chittenden Falls Hydro Project on Kinderhook Creek plant to Skidmore College 60 miles away under the state’s remote net metering program. Skidmore owns the meter at the site, and it counts toward around 10 percent or more of the campus’s electricity use.
“You can produce kilowatt hours more cheaply from a coal plant or from, generally, a gas plant than you can from a small hydro plant,” said Ted Rose, CEO of the Colorado-based company. “But the real question is: Is a small hydro asset that’s been around for 100 years inside a community, does that have value to that community above and beyond those kilowatt hours? And I think that answer is yes.”
For decades, the Terbushes sold their hydro power to the local utility under a 1978 federal law promoting renewable energy. Those contracts lapsed, and they began selling power last year from Wallkill under the state’s “community-distributed generation” program.
Bower-Terbush said the transition to marketing directly to customers has been challenging, but they are working toward selling power the same way at their other two sites.
The policy allows electricity customers to collectively invest in renewable projects, mostly solar, in their utility service territory.
It allows Manna Jo Greene to support the Wallkill site, 20 miles from her home.
“My thought was to support a local source of generation: clean hydroelectric power,” said Greene.
They can’t run a power cord from Greene’s home. Wallkill’s hydroelectricity still flows into the grid. Instead, customers essentially reserve a percentage of the power generated by a hydro project. The local utility still sends a monthly bill, but with credits based on hydropower the customer signed up to buy. Natural Power Group sends a separate bill, with a 10 percent discount on the credits.
New York ratepayers help fund renewable programs like this through a monthly charge on their bills, though regulators say costs are mitigated by investments in local generation.
Greene and other customers say cheaper electricity bills are nice, but the choice is philosophical. Greene is a veteran environmental activist who already relied on rooftop solar panels for most of her electricity. Officials in nearby Woodstock purchased hydro to help keep the famously left-of-center town meet its carbon-neutral goals.
“They decided that they really wanted to have something local, where you could actually understand that the renewable power was being generated,” said Kenneth Panza, a resident who helped choose hydro, “rather than buying renewable energy credits from windmills in Texas or Oklahoma.”
