U.S. Hydropower Market Report (January 2021 edition)

Abstract

On the front cover: Red Rock Hydroelectric Project, Marion County, IA (image courtesy of Missouri River Energy Services). This project, which adds hydropower generation capability to a non-powered dam owned by the U.S. Army Corps of Engineers, will have a capacity of 36.4 MW and generate enough electricity to meet the demand of approximately 18,000 households. The Federal Energy Regulatory Commission issued the Western Minnesota Municipal Power Agency a license to develop the project in April 2011, construction started in the third quarter of 2014 and was completed in the summer of 2020. Commercial operation is scheduled for the spring of 2021.This report is being disseminated by the U.S. Department of Energy (DOE). As such, this document was prepared in compliance with Section 515 of the Treasury and General Government Appropriations Act for fiscal year 2001 (Public Law 106-554) and information quality guidelines issued by DOE. Though this report does not constitute "influential" information, as that term is defined in DOE's information quality guidelines of the Office of Management and Budget's Information Quality Bulletin for Peer Review, the study was reviewed both internally and externally prior to publication. For purposes of external review, the study benefited from advice and comments of eleven hydropower industry and trade association representatives and six U.S. Government employees.

What Does Global Land Climate Look Like at 2°C Warming?

“…For instance, greatly reduced precipitation over the Amazon region in the 2040s may pose an increasing challenge to keep current hydropower production while finding alternative reliable energy sources. Projected increase in precipitation over African and South Asia may grant potential opportunities in hydropower production but more precipitation may accompany with higher variability, that is, extreme rainfall events, further challenges to be prepared for extreme weather events (Uria Martinez et al., 2021) (Figures 3 and 4). This is particularly critical to some countries, such as Bhutan and Nepal, where hydropower accounts for over 90% of total electricity generation.…”

Closed-Loop Pumped Storage Hydropower Resource Assessment for the United States. Final Report on HydroWIRES Project D1: Improving Hydropower and PSH Representations in Capacity Expansion Models

“…Cost estimation is also difficult for the U.S. context, as only one new PSH project 8 has been completed in the past 20 years, and its construction began in 2005. Three projects have been issued licenses by FERC: Eagle Mountain in California, Gordon Butte in Montana, and Swan Lake in Oregon (Martinez et al 2021). The FERC application for Eagle Mountain, which included sufficient proposed cost detail to allow a high-level comparison, is detailed in Section 3.2.1.…”

Price Formation in Zero-Carbon Electricity Markets: The Role of Hydropower

“…Because of its reliable capacity availability and flexible operating characteristics, a hydropower resource can provide ancillary services. For example, in the PJM market, hydropower provides less than 5% of total installed capacity, but provides about 20% of regulation reserves, 30% of non-synchronized primary reserve, and 15% of day-ahead scheduling reserve on average between 2014 to 2019 (Uria Martinez, 2021). As the demand for reliability services increases in zero-carbon systems to help balance variable wind and solar generation, the ability of hydropower to provide these services will also likely be increasingly valuable.…”