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Commentary: Could Hydropower Come Rushing Back?


Industrial Management

Commentary: Could Hydropower Come Rushing Back?

Once considered green and clean, hydropower enjoyed decades of glamour next to its bad-boy cousin, the nuclear plant. Even when it was obvious that dams ruined river ecosystems and often weren't economical to build, hydropower fans and foes agreed that electricity produced from water was at least dependable.

Today, dependability wins a lot more points. After a summer of wild energy-price volatility, and consumer exasperation with power disruptions, even the most hard-nosed environmentalists are praising hydroelectricity as a renewable resource that produces far less pollution than thermal plants. The problem is, hydropower's newfound popularity comes at a time when few untapped resources are left. "We've utilized all the best sites," says George Gross, a University of Illinois expert in energy policy. "There is nowhere else to build."TOUGH TIMES. But it may not be necessary to build anew. The vast majority of the thousands of dams in the U.S. are today used only for irrigation and agricultural purposes--electricity is produced by just 3% of them. "We can take some of these existing dams to generate electricity," says Linda Church Ciocci, executive director of the National Hydropower Assn. "There are tremendous growth opportunities, and we can do it in an environmentally sensitive way." Consequently, many experts believe that hydroelectricity--in a modest, small-is-beautiful way--will play a bigger role in supplying U.S. power needs. Right now, only 3.32% of the nation's total energy consumption comes from hydropower, down from 3.71% in 1990.

Hydro's share could climb again, Gross and others say, when the energy shortages that have racked California spread across the U.S. Continuing deregulation of the $220 billion U.S. electricity market seems sure to cause instabilities in supply and pricing, which will encourage more reliance on stable power sources. "Given the large interests that depend on cheap hydro, I doubt that many large dams will be torn down," says Stanford economist Geoffrey S. Rothwell. "The question facing electricity policy makers in a few decades will be whether to replace aging dams."

Hydro advocates figure that the unquenchable demand for electricity will keep dams in action. That sentiment is certainly in sync with much of the developing world. In some countries, such as Turkey and China, the need for electricity has overpowered environmental concerns. Although new hydro construction in the U.S. is confined to small, unregulated dams serving local needs, Third World countries are still pushing forward with giant projects--witness China's massive Three Gorges Dam.

Few people wish to pursue anything like that in North America. Indeed, the prognosis for renewable energy in general--wind, geothermal, and solar, as well as hydro--is not terribly bright, because of uncompetitive economics. By output, hydro makes up 80% of the renewable category today. While it will probably hold at around that level, the U.S. Energy Dept. predicts that faster growth in other power sources will cause America's reliance on renewable power sources to fall from 11.3% of 1998's total to about 9.5% in 2020.

The hydro cause is not helped by the fact that opinion is so polarized--even in the green community. "We don't build hydro dams for the same reasons we don't build carts with stone wheels," says Ken R. Margolis, president of Portland-based River Network. "Maintaining dams here guarantees the extinction of salmon."

To make matters worse, hydropower as a business is hampered by regulatory red tape. Getting a license for a hydroelectric dam can take 8 to 10 years--versus just 18 months for a natural-gas generator. Such delay tends to drive away even the most enthusiastic investors.

Still, the urgent need for inexpensive power is forcing reevaluation of hydro's potentials. Water is likely to become a more viable part of the nation's energy future.By Petti Fong; Fong Reports on Energy from Vancouver.


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