Rich Swanson, PHD
Advising senior energy executives in realizing the full value of their investments through expert financial valuation, economic analysis and risk mitigation, to accelerate complex projects to financial close.In Africa and Asia energy development plans call for large investments in hydropower. But there is room to invest in this proven renewable energy source in the U.S. as well. And, the trends in the U.S. may be interesting for other countries as well. Late last year, the Department of Energy (DOE) awarded $24.9 million in funding to stimulate hydropower innovation in the U.S. This follows its significant “Hydropower Vision” report released in 2016.
Though advances in solar, wind and battery storage have been in the headlines, the US energy mix still features hydropower as its largest renewable energy source at 7% of total energy delivered (wind is not far behind at 6.5%). The DOE continues to promote hydropower innovation and envisions 48.3 GW of new capacity by 2050.  In fact, much of the DOE award money mentioned above appears to be clearing the way for new investments by promoting efficiency and environmental innovations.
Here are three areas in which hydropower investment in the U.S. may make the best sense…
• Augmenting capacity at existing sites. Refurbishment at existing sites takes the form of life extension, upgrades and expansions. Since the average age of the existing hydropower fleet is now approaching 50 years, the “re-commissioning” of these sunk costs can account for a significant increase in energy delivery.
• Non-powered dams and other existing infrastructure. There are over 80,000 non-powered dams in the US and thousands of miles of existing, man-made conduits that move water and wastewater. The abundance of existing infrastructure can limit cost, and environmental impact (due to using an existing structure) make this an attractive resource for hydropower development.
• Low-head hydro. These are small capacity facilities that use tidal flows or rivers with a head of 20 meters (66 ft) or less to produce energy. Often, no dam is needed. Using the drop in a river or even tidal flows to create electricity can provide a renewable energy source that will have a minimal impact on the environment.
Advising senior energy executives in realizing the full value of their investments through expert financial valuation, economic analysis and risk mitigation, to accelerate complex projects to financial close.
Richard Swanson, Ph.D.
Asset valuation and project finance expert, specializing in financial and economic analysis of civil infrastructure assets.