SILVERTON – A tiny 11 kilowatt hydroelectric project built by the San Juan County Historical Society at the Mayflower Mill near Silverton is the first small hydro project in Colorado, and one of the first in the nation, to qualify for exclusion from federal permitting requirements under the recently enacted Hydropower Regulatory Efficiency Act, a federal small hydro permitting reform bill signed into law last August.
SJCH Chair Bev Rich received word of the exemption from the Federal Energy Regulatory Commission on Nov. 21. Small hydro projects in Telluride and Orchard City have also applied to FERC requesting exemption under the new law.
Under the new legislation, co-authored by U.S. Reps. Diana DeGette (D-CO) and Cathy McMorris Rogers (R-WA), small hydropower projects on existing conduits, including pipelines and canals, can apply to FERC requesting exemption from federal permitting requirements.
The legislation was passed unanimously by both the House and the Senate earlier in the year and was signed into law by President Obama on Aug. 9. It was widely hailed as one of the few bipartisan success stories to recently come out of congress.
“I am so proud that one of the first small hydro projects in the nation to benefit from my legislation is happening right here in Colorado, helping to create jobs in our state, and demonstrating the impact of smarter, more efficient hydropower project permitting,” said DeGette. “For Colorado and the nation, this law is already delivering tangible results by expanding renewable and affordable hydropower.”
The small, grant-funded Mayflower Mill hydro project is powered by water delivered through a pipeline from Arrastra Gulch, high above the mill. The hydro plant itself is housed in a recycled building that was donated to SHCHS by the Durango & Silverton Narrow Gauge Railroad.
The power that will be generated there will offset the $600-a-month electricity bill that OCHS now pays to keep the lights on at the Mayflower Mill, a National Historic Landmark that the society runs as a tourist attraction in the summer, with enough left over to sell surplus to San Miguel Power Association.
The plant has been ready to fire up for some time, but got caught up in bureaucratic red tape before the enabling legislation was passed, when FERC required that the project needed to apply for a hydropower license – same as giant hydro projects like the one on the Hoover Dam.
“Requiring a federal hydropower license for a tiny, non-controversial hydro project on an existing pipeline was completely nuts,” said Beverly Rich, Chair of the San Juan County Historical Society.
Prior to the new law, federal permitting requirements for small hydro projects had been time-consuming and costly. For smaller systems, in many cases the cost of federal permitting exceeded the cost of the hydro equipment -- which has been a barrier to small hydro development for decades.
The Hydropower Regulatory Efficiency Act solved this problem by creating a “regulatory off-ramp” from FERC permitting requirements for non-controversial hydro projects on existing conduits such as pipelines and canals which are less than 5-megawatts.
“The new small hydro permitting reform law doesn’t change any underlying federal or state environmental statute,” said Kurt Johnson, the President of the Colorado Small Hydro Association (COSHA) and Principal at Telluride Energy, a small hydro development and consulting firm. “It simply streamlines the federal approval process for non-controversial small hydro projects.”
Johnson has advocated for the legislative reform for the past two years, and traveled to Washington, D.C. in 2012 to testify on its behalf.
Studies conducted in recent years have shown that there is tremendous untapped U.S. hydropower growth potential. Navigant Consulting found that 60,000 MW of hydroelectric capacity could be built by 2025, with the right policies in place. Over one million cumulative jobs could be created in pursuit of that goal.
Colorado currently has hundreds of hydro-related jobs, a number that has the potential to grow rapidly. The National Hydropower Association has estimated 5.3 jobs created per megawatt of new hydro construction. COSHA estimates approximately 100 MW of potential new hydro development in Colorado, which could mean approximately 500 new jobs created, including jobs for developers, engineers, attorneys and financiers as well as concrete workers, plumbers, carpenters, welders and electricians.
Colorado legislators are currently considering similar state-level small hydro permitting reform legislation which would create a new process to synchronize state environmental agency review with federal review – a step which would further streamline the small hydro development process.