FEDS SEEK INFO ON HYDROELECTRIC DAM PROJECT

The following article by Drew Kerr was published in the July 13, 2012 on-line edition of Finance and Commerce:

Plans to build a 3.4-megawatt hydroelectric facility north of the Stone Arch Bridge have stalled for years, but the company behind the project is now looking at a new site they say could finally put the project in motion. (File photo: Bill Klotz)

Plans to build a hydroelectric facility north of the Stone Arch Bridge – stalled for a decade amid concerns it would disrupt the historic and recreational area – are coming back into focus as federal regulators demand to see evidence progress is being made on the project.

The Federal Energy Regulatory Commission in June sent Crown Hydro LLC: http://www.crownhydro.net/ a notice: https://parkwatch.files.wordpress.com/6-14-2012FERCNoticeofInitiationofTerminationProceedings.pdf saying the company needed to prove it was working toward construction of the facility or risk losing a license to build a 3.4-megawatt facility on the west side of the Mississippi River.

The project was licensed in 1999 but has stalled because the Minneapolis-based company, owned by local investor Bill Hawks, has failed to reach an agreement with the Minneapolis Park & Recreation Board, which owns the site where the facility was intended to be built.

Park Board officials have expressed concerns that a hydroelectric plant north of the Stone Arch Bridge would lower water levels over the Upper St. Anthony Falls: http://www.mvp.usace.army.mil/navigation/default.asp?pageid=145&subpageid=144 and disrupt sensitive environmental and historic resources in the area.

Tim Keane, counsel for Crown Hydro, said Friday that a response to the FERC notice would be filed by a July 19 deadline outlining steps that are being taken to pursue a U.S. Army Corps of Engineers site just 250 feet from the Park Board property.

Crown Hydro approached the Army Corps about the site last year, after an agreement with the Park Board fell through and it became apparent that no resolution was likely. Site review, expected to take around a year, is occurring now and construction could begin as soon as the fall of 2013 if permits are in place, Keane said.

Keane said he hoped that work would convince FERC officials that good faith efforts to advance the project are being made. If the license were lost, it would be a financial and logistical challenge to obtain another one, he said.

“The crux of our response to FERC is that we do not intend to surrender our license due to lack of progress or proceeding with due diligence,” Keane said. “To the contrary, we have been pursuing with due diligence and in good faith.” Keane said more progress has been made in the last nine or ten months with the Army Corps than in the previous 12 years with the Park Board.

Crown Hydro already has spent $6 million trying to get the project going, he said. Turbines and other equipment were purchased in 2003, but now sit in a temperature-controlled facility in Jordan, Minn. Construction was expected to cost $11 million, but the new site may be less expensive, Keane said.

Nanette Bischoff, FERC coordinator with the U.S. Army Corps of Engineers St. Paul District, was unavailable for comment on Friday. But in a recent letter addressing the proposal she listed concerns about navigation, historical, environmental and aesthetic impacts that would have to be addressed if the project is to move forward. The letter also raised questions about whether the project would be able to capture the 1,000 cubic feet per second of water Crown Hydro believes it needs because of existing hydroelectric facilities in the area.

Xcel Energy expects to complete an expansion of its Hennepin Island Hydro Generating Station: http://www.xcelenergy.com/About_Us/Our_Company/Power_Generation/Hennepin_Island_Hydro__Generating_Station?stateSelected=true on the other side of the Mississippi River, this spring. New turbines are increasing the facility’s generating capacity from 12 megawatts to 14.2 megawatts.

Rob Olson, Xcel’s superintendent of hydro operations, said the expansion shouldn’t impact Crown Hydro’s ability to capture the water flow it needs to operate, however.

The river has been running high all spring and summer, with flows occasionally topping 40,000 cubic feet per second – a level so high that locks and dams were closed to commercial and recreational traffic.

Keane said engineers for Crown Hydro also believe there is enough water to meet the facility’s needs, and that energy from the facility, capable of powering 2,500 homes a year, still is needed. Crown Hydro has a purchase agreement to sell the energy to Xcel.
Park Board leaders remain concerned about the project, however.

On Wednesday, Park Board commissioners approved a resolution to ask FERC to revoke Crown Hydro’s license.

Commissioner Liz Wielinski said the Park Board also has an easement to use part of the Army Corp land that Crown Hydro intends to use, and may have additional rights to other land needed to build the facility. A survey needs to be completed to clarify ambiguity about property ownership in the project area, she said.

Wielinski said she hopes the license will be revoked so that the proposal disappears for good.

“We realize now that the only way to be sure this project isn’t going to come back is to revoke the license,” she said.

There are more than 30 hydroelectric facilities in Minnesota, and plans have been floated: http://finance-commerce.com/2011/10/plugging-into-mighty-mississippi-river-shows-promise-for-hydroelectric-projects/ to build several more on lock and dams farther south along the Mississippi River.

The newest hydroelectric facility, a 10-megawatt plant: http://brookfieldrenewable.com/_Global/44/documents/relatedlinks/4616.pdf on the Lower St. Anthony Falls Dam, was built by Marlborough, Mass.-based Brookfield Renewable Energy Partners: http://brookfieldrenewable.com and Wayzata-based Nelson Energy: http://nelsonenergy.us . The $35 million facility went into commercial operation in December.

THE FRAGILITY OF THE FALLS

One of the concerns that has been expressed in opposition to the Crown Hydro project is the fragility of the area surrounding St. Anthony Falls. Beneath the Mississippi River’s limestone rock bed, there is soft sandstone. When the sandstone was disturbed in 1868 during construction of a tailrace for a mill on Nicollet Island, it set off a chain of events that threatened the Falls, which began disintegrating.

In 1874, the Army Corps of Engineers came to the rescue of the disintegrating Falls by constructing an 1,850 foot wall that “secured the stability of St. Anthony Falls and, with it, the future of milling.” But as John O. Anfinson pointed out, because of this incident, “the sights and sounds of the natural falls disappeared forever.”

For those who are familiar with the history of the St. Anthony Falls Area, it is this historic disaster–which was the unintended consequence of an ill-fated project–that comes to mind when the Crown Hydro project is mentioned.

This memorable incident is described in detail in an article published in Minnesota History vol. 58, Spring/Summer 2003 by Mr. Anfinson, who is now Chief of Resource Management with the Mississippi National River and Recreation Area, a unit of the National Park Service. For those who are not familiar with this historic incident, his recounting of it is well worth reading. It can be found on pages 259-260 of the article, which is being used here with permission of the Minnesota Historical Society.

Arlene Fried

Co-founder of Park Watch

SPIRITUAL POWER TO INDUSTRIAL MIGHT

12,000 YEARS AT ST. ANTHONY FALLS

by John O. Anfinson

The following item by Eric Roper was published on the July 5, 2012 Star Tribune website:

FEDS MAY PULL PLUG ON HYDROELECTRIC PROPOSAL

The federal government may soon put the kibosh on a controversial and long-delayed plan to build an underground hydro-electric power plant near the Stone Arch Bridge.

Crown Hydro, LLC, obtained a license 13 years ago for a 3.4-megawatt plant powered by the Mississippi River. But the project stalled because of continued opposition from local activists and the Minneapolis Park and Recreation Board, which owns a proposed site.

Last month, the Federal Energy Regulatory Commission sent notice that they may soon revoke the license because “[Crown Hydro] has failed to complete construction of the project as licensed, and [the commission’s] findings fail to show it can do so in the near future.”

That could spell the end of the project, unless someone makes the case why the license should be extended. Park Board Commissioner Liz Wielinski, who has opposed the project, is not ready to declare victory.

“For me, it’s a welcome sign that they’re finally taking this seriously,” Wielinski said. “But until every single door is closed, I’m not assuming that it’s completed yet. Because it’s come back many many many many times.”

An attorney for Crown Hydro, Tim Keane, said they plan to file a motion to intervene before the July 19 deadline. He noted that they are now pursuing using a plot of land owned by the Army Corps of Engineers.

“The FERC is aware of that — that we are no longer pursuing the location on Park Board property,” Keane said. FERC’s notice addressed the new site plan, observing that “there is still no expectation that [Crown Hydro] will complete construction of the project in the forseeable future.”

Even that site that could prove problematic. The Army Corps has raised its own concerns with the plans, and using the land would require extensive analysis and signoff from the Corps’ chief engineer in Washington, D.C.

“We support hydropower in general,” said Nan Bischoff, the FERC coordinator for U.S. Army Corps of Engineers, St. Paul District. “This particular proposal, I can’t say that we’re thrilled about. We’ve stated our concerns, and those concerns are published on the FERC website.” http://elibrary.ferc.gov/idmws/common/opennat.asp?fileID=12926425

Staff Writer Masako Hirsch contributed to this report.

The following article by Nick Halter about FERC’s notice of termination to Crown Hydro was published in the July 2, 2012 issue of the Downtown Journal. In it, a representative of Crown Hydro refers to Crown Hydro’s “substantial progress,” but there is no further explanation of what that “progress” is. Here’s the article:

CROWN HYDRO SAYS IT WILL INTERVENE BEFORE LICENSE TERMINATION

A project that would have harnessed St. Anthony Falls power for hydroelectricity near Downtown is on life support after a 13-year political battle, as a federal commission has initiated proceedings to terminate the project’s license.

The Crown Hydro project would have installed turbines below the St. Anthony Falls on the west side of the river and generated 3.2 megawatts of electricity, enough to power 2,200 homes.

Documents filed on June 14 by the Federal Energy Regulatory Commission say the project isn’t making any progress and therefore should lose its license. The only thing that can stop the proceedings is a motion to intervene, which is due July 19.

On June 22, Crown Hydro attorney Tim Keane left a voicemail with The Journal saying the project would intervene in the proceedings.

“Crown Hydro does intend to intervene in the notice to terminate on the basis of the substantial progress we have made developing a facility on the [U.S. Army] Corps [of Engineers] federal campus,” Keane said.

Crown Hydro got a federal license for the project in 1999 and the owner, Bill Hawks, purchased turbines that have sat unused since.

“After more than 13 years since the issuance of the license, there is still no expectation that the licensee will complete construction of the project in the foreseeable future,” FERC wrote in its documents initiating the license termination.

Crown Hydro has made several attempts to complete the project since 1999, but the Minneapolis Park and Recreation Board has denied it a lease needed to dig below park property.

Last May, Crown Hydro made one last effort to sway Park Board commissioners to approve the project. Crown Hydro even got as far as drafting a letter of intent in conjunction with Park Board staff, but at the 11th hour the deal fell apart. Crown Hydro says the Park Board made late changes to the letter that made the project unworkable.

The Park Board didn’t like a few things about the project. Commissioners and neighbors complained that by diverting water to the turbines, St. Anthony Falls would dry up. They also expressed concerns about what effects construction would have on the integrity of the surrounding land in the burgeoning Mill District of Downtown.

In recent months, Crown Hydro has been trying to get the U.S. Army Corps of Engineers to agree to a deal that would allow the turbines to be installed below federal property.