By Bob Gallo
April 10, 2017 at 5:00 am ET
In recent remarks to an industry roundtable, President Donald Trump said, “You know, hydropower is a great, great form of power. But we don’t even talk about it anymore because the permits are virtually impossible. [Hydropower] is one of the best things you can do, but we don’t even talk about it anymore.”
For those who work in the original renewable energy industry, the president’s praise was a welcome acknowledgment of the biggest challenge we face moving forward. Yes, hydropower is indeed great, but regulatory and investment hurdles prevent it from becoming even greater.
Fortunately for President Trump, Congress has started to clear a path for increased hydropower development.
Hydropower licensing reform was a key component of the Energy Policy Modernization Act of 2016, a comprehensive and bipartisan bill that sought to strengthen research and development and increase efficiencies and production across virtually all energy sectors.
For hydropower, the legislation addressed an acute need to reduce unnecessary licensing delays that can drive up the cost of projects and the price consumers pay for electricity. Most importantly, it designated the Federal Energy Regulatory Commission as the lead agency in the licensing process, with authority to set firm schedules. The lack of timelines is one of the primary reasons hydropower licensing can last 10 years or more — even longer than the process for nuclear energy.
Despite bipartisan support in both the House and the Senate, Congress did not finish its work on the Energy Policy Modernization Act before adjourning in December. President Trump can make hydropower even greater by including hydropower investment and licensing reform in his infrastructure plan.
Hydropower and its associated infrastructure are prime targets for investment. Though the average American likely views hydropower through the lens of the iconic western dams built in the early and mid-20th Century, its future lies in the approximately 80,000 dams across all parts of the country that do not produce electricity and upgrading the mere 3 percent that currently generate power.
These dams — both powered and non-powered — represent tremendous untapped energy potential, and many are already in need of important upgrades to ensure they can generate clean and reliable hydropower well into the future. Dams of all types, which are on average 56 years old, were given a D grade in the American Society of Civil Engineers’ 2017 Report Card for America’s Infrastructure.
For those that already produce power, the long operating life of their equipment means these facilities are falling behind on modern technological standards that increase electric generation and environmental performance. Investments in resources and manpower in hydropower projects would provide substantial benefits in the form of increased energy output and efficiency, new job creation, and improved environmental sustainability. The fact that the federal government operates 50 percent of the nation’s generating capacity means these investments are both a responsibility and a clear opportunity.
Make no mistake: The state of our hydropower fleet is a short-term and long-term challenge. Nearly 15 percent of our currently-installed hydropower capacity will be up for relicensing in the next decade and a half. Facing the time and expense of a burdensome relicensing process, some hydroelectric facility owners have already opted to abandon their existing projects.
The focus on hydropower must increase to preserve this critical infrastructure and provide needed additional power to a nation hungry for clean energy. Indeed, the Department of Energy’s Hydropower Vision Report estimates that domestic hydropower generation can increase by 50 percent by 2050, but that won’t happen if we only maintain the status quo.
Increased hydropower production also has a very important side benefit: jobs. There are currently 300,000 people working in the hydropower industry across the U.S., and many of these jobs are both highly skilled and pay well. The hydropower supply chain includes 2,500 businesses that touch all corners of the country.
With an increase in new orders resulting from additional investment in and regulatory streamlining of hydropower, Pennsylvania’s Voith Hydro could add many new field operations, engineering, and manufacturing jobs to our current 680-strong nationwide workforce. These are the jobs that provide the massive turbines, generators, and other equipment relied upon to bring clean, affordable, and reliable energy to millions of Americans.
But these energy, infrastructure, and jobs goals will not be realized without meaningful investment in hydropower coupled with robust licensing reform.
President Trump’s analysis of hydropower was spot-on, and we encourage him to work closely with members of Congress from both parties, as well as industry stakeholders, to ensure hydropower is a prominent piece of any infrastructure plan.
Improving and increasing our hydropower infrastructure will go a long way in making both hydropower and America great again.
Bob Gallo is president and CEO of York, Pa.-based Voith Hydro, Inc.
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