Two Ways Hydro Can Win: Call it 'Renewable,' Position it as Backup to Solar and Wind

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Written by John Egan for Industrial Info Resources (Sugar Land, Texas)--Changes in the U.S. Power generation fleet and transmission network may create new opportunities for pumped-storage hydroelectric projects, speakers told a hydro conference in Denver in late June. "The grid of today is not the grid of tomorrow," Tim Welch, hydropower program manager in the water power technologies offices at the U.S. Department of Energy, told attendees at the HydroVision International conference June 29. The event was sponsored by PennWell (Tulsa, Oklahoma).

Pumped-storage projects have fallen out of favor due to their large size, big price tag and long licensing process. Industrial Info is tracking 51 active pumped-storage hydroelectric projects in the U.S., valued at about $50.23 billion. But cancelled or deferred projects outnumber the active projects: 62 pumped-storage projects, valued at $71.07 billion, have been cancelled or placed on hold, according to Industrial Info's North American Industrial Project Platform.

Among the U.S. states with active pumped-storage projects being developed, Oklahoma, California, Washington State and Ohio have the largest total investment value (TIV) of pumped-storage projects, according to the project platform.

Click on the icon at right to see the U.S. states with the largest dollar-value of pumped-storage projects under development.

Despite the federal government's decision to withdraw from the Paris climate accord, there still is ample appetite for renewable energy development. Though often characterized as largely solar or wind, hydro also could be deemed a "renewable" energy resource if a bill making its way through the House of Representatives succeeds in defining hydro as a renewable. For more on that bill, H.R. 3043, the Hydropower Policy Modernization Act of 2017, which is sponsored by Rep. Cathy McMorris Rodgers (R-Wash.), see July 6, 2017, article - Hydro Industry Expects Better Days in a Trump Administration.

Even if that definition gets stripped out of the House bill, hydroelectric generation in general--and pumped-storage projects in particular--have an important role to play in backing up intermittent generation sources like wind and solar. Though many renewable projects are backed up by gas-fired generation, some regions of the country rely on hydro to back up intermittent renewable energy resources.

The U.S. has 42 pumped-storage projects with total generating capacity of about 22,000 megawatts (MW), Linda Church Ciocci, executive director of the national Hydropower Association (NHA) (Washington, D.C.), told HydroVisionl International attendees June 28. She referenced the U.S. Department of Energy's mid-2016 report, "Hydropower Vision: A New Chapter for America's 1st Renewable Electricity Source," which said that the nation could add about 35,500 MW of new pumped-storage generation by 2050, with the right set of policies and regulatory reforms. This 35,500-MW goal also would require low-cost financing, the DoE report added.

For more on that, see July 3, 2017, article - HydroVision Conference Speakers Showcase Hydro's Potential. For more reports from the HydroVision International conference, see July 10, 2017, article - Can FERC Pilot Licensing Program Speed Installation of Hydro Generators at Non-Power Dams? and July 5, 2017, article - Exhibitors at HydroVision International Chase Refurbishing, Greenfield Projects.

"There is a tremendous room to grow pumped-storage projects, but there are significant challenges as well," Church said June 28.

She noted that 15 pumped-storage projects, totaling 8,534 MW of generating capacity, have received their preliminary permits, and an additional 23 projects, with total generating capacity of 4,556 MW, have preliminary permits pending. Three large projects, located in Utah, Oregon and New York, have new licenses pending, she added. Those three projects have a total generating capacity of 1,633 MW.

Church and other speakers at the event decried hydro's current regulatory system, where it typically is not recognized as a renewable resource. But whether hydro ever gets redefined as a renewable resource, it has an important complementary role to play with other renewable resources, speakers pointed out.

One step forward, Church said, would be to require consideration of energy storage resources in states' integrated resource planning (IRP) processes, including requiring pumped-storage projects to be given equal consideration with traditional generating resources.

Several speakers warned attendees against trying to pit hydro versus wind and solar. Rather, hydro should be positioned as complementing those resources, particularly as a form of emission-free backup power. That was a critical characteristic of hydro that was not being adequately valued in state IRP processes.

The Federal Energy Regulatory Commission (FERC) (Washington, D.C.) might become more of a pro-hydro force with the nomination of Neil Chatterjee and Robert Powelson as new commissioners, speakers suggested. "When he worked on energy issues for Senate Majority Leader Mitch McConnell, Neil was pro-hydro development, Jeremy Harrell, policy director for Clear Path (Washington, D.C.), a Republican-oriented clean energy research and advocacy organization, told conference attendees June 28. "And Robert Powelson, as a state utility regulator, has a good understanding of the barriers facing hydro at the state level."

Both nominees were approved by the Senate Energy & Natural Resources Committee, but both still require a vote of the full Senate before they can take their seats at FERC. Congress is due back from its July 4 recess this week, but with contentious issues like health care reform and tax reform clogging up the legislative calendar, it is unclear when the two nominees would get a vote in the Senate. For more on the currently quorum-less FERC, see June 12, 2017, article - FERC Eyes Restoration of Quorum, Resumption of Rulings and March 6, 2017, article - New Hurdle for Interstate Energy Projects: A Quorum-less FERC.

"And Cheryl LeFleur, the acting FERC Chair, has been great on hydro too," added NHA's Church.

When the general public thinks about "energy storage," they probably think of battery storage, speakers acknowledged. But hydro in general, and pumped-storage projects in particular, could be transformed if the industry started referring to those projects as "bulk energy storage," several speakers told conference attendees. Officials at the National Hydropower Association predicted more active messaging and outreach on hydro in the coming months as they try to change the views of lawmakers, opinion leaders and the general public about hydro's role as a renewable resource and as a non-emitting source of back-up generation for wind and solar.

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