HomeMy WebLinkAboutMN-HDPC-1988-12-13 DRAFT -
Minutes - Hydropower Committee Meeting
December 13 , 1988
Third Floor Conference Room
City Hall, Ithaca, New York
Present: Dan Hoffman, Martin Sampson, Ellen Harrison, Ed
Brothers, Mike Sprague, Mark Walker, Seth Mulholland, Helen
Jones
Absent: Cathy Emilian, Alex Skutt, Therese Araneo
Stated Agenda (Memorandum from City of Ithaca Department of
Planning and Development - no date) :
1. Approval of Previous Minutes
2 . FERC License Requirements - Compliance Report
3 . Fisheries Update Analysis - Final Approval
4 . NYSEG Power Sale Contract Negotiations - Report
5. Ithaca Falls Project Timetable
6 . Six Mile Creek Projects
Minutes of the Meeting
The meeting began at 7 :30 PM. Roughly a dozen members
of the public attended. Chairman Hoffman suggested that the
agenda be changed to ensure that issues important to them be
discussed before considering other Commission business,
particularly the minutes from previous meetings.
Chairman Hoffman gave a brief report about the status
of the proposed hydropower project on Fall Creek. He
reported that the November referendum to build had been
approved by a majority of city voters. In order to preserve
this option, the city must continue to comply with license
requirements set by the Federal Energy Regulatory Commission
(FERC) .
1 . FERC License REquirements - Compliance Report
Helen Jones gave a brief report of the city' s efforts
to meet FERC requirementss . She has been working to meet two
requirements - the design of a fish diversion rack at the
intake for water piped to the generating plant and the
design of an emergency action plan in case of a dam break.
Helen consulted with the New York State Department of
Environmental Conservation about the specifications for the
fish diversion rack. The design is determined by the size
of the bars needed, which in turn is related to the maximum
allowable water velocity at the rack. Helen reported that
no extra measurements of stream velocity would be needed
for the final design.
In conducting her studies for the Emergency Action
Plan, Helen found that although the reservoir behind the
existing Fall Creek dam is small, the dam is larger than
previously thought. The structure appeared to be set on a
weathered rock formation, which, upon closer inspection, was
found to be concrete. The concrete spans twelve to fifteen
feet from base to crest of the dam. However, based on the
amount of storage behind the dam, the city has requested
exemption from filing a comprehensive emergency action plan.
Ed Brothers suggested that threat of dam break would
coincide with high flow times when the downstream portions
are least used.
Flow measurement after the dam is an important
requirement that may be more difficult to meet than was
previously thought. Helen' s conferences with the U.S.
Geological Survey (USGS) have found a few options for
measuring flow, though this is complicated by the lack of a
good control structure in the creek bed below the falls .
Helen and Jim Campbell of the USGS are examining
alternatives.
2 ) . Fisheries Update Analysis - Final Approval
Ichthyological Associates, Inc. submitted revisions to
the "Angler Survey and Fish-Stocking Review for Ithaca Falls
Hydroelectric Power Project - DRAFT, " which was submitted on
September 6 , 1988 . The Commissionls discussions focussed on
further revisions to clarify parts of the report important
to determining operating policies for the plant. These
include a clearer, stronger statement to support extra
conservation releases to make sure that fish don' t mass in
the tailrace pond, where they would be very vulnerable to
anglers.
Eric Seidler, an observer in the audience, suggested
that the survey was limited, in that it did not consider
potential effects on "non-glamorous" species -- those not
stocked by the NYSDEC.
The commission agreed that the revisions called for
were not major, but that final payment should follow
completion of the report. However, rather than asking the
consultants to wait for approval and payment until full
commission approval, Ed Brothers and Dan Hoffman will review
and approve the revisions if these are completed before the
next commission meeting.
3 . NYSEG Power Sale Contract Negotiations - Report
Before the November referendum the City began
negotiations with New York State Electric and Gas for a
purchase price for power generated by the proposed Fall
Creek plant. Helen and the city ' s controller and attorney
have been the negotiating team. The negotiations lead to
substantial agreement on several proposed rates and types of
payment schedules. The Budget and Administration Committee
of the Common Council received a draft version of the
contract and will discuss it during its final meeting of
1988 . The contract is NYSEG' s standard agreement.
In Helen' s opinion the most difficult parts of the
contract to accept will be the "out clauses, " that serve as
safeties for NYSEG in the event of a city default or
circumstances that force NYSEG to nullify their contract
with the city. One further complication lies in a
requirement that the city post a letter of credit or
security bond if some levelized cost options are adopted.
This would be to insure that in the event of a city default
on the contract NYSEG would be able to recoup losses from
initial overpayments.
However, much larger decisions being made in the State
are forcing contract negotiation and acceptance deadlines
that may be difficult for the Common Council to meet, given
the complexity of the contract and possible need for further
negotiations. These include a change in the way that NYSEG
sets prices for power. On December 1 NYSEG petitioned the
Public Service Commission to suspend negotiations with
roughly 30 small power generators, such as the city, in
favor of a proposed bidding system. The city is nineteenth
or twentieth in line for a final contract and all of the
others are trying to negotiate and sign before the Public
Service Commission lets NYSEG suspend negotiations.
Suspended negotiations will lead to a bidding system
that may be very unfavorable to pursuing a direct sale to
NYSEG. The system may be in place in the first months of
1989 . Under this arrangement, NYSEG would request bids for
power to offset peak power demands, which generally come in
the winter and summer. These are low flow seasons for Fall
Creek, and consequently the predicted power generation curve
for Fall Creek would be unappealing to NYSEG under the new
bidding system. Fall Creek' s peaks occur in Spring and
Fall.
4 . Other Options for Hydropower Development on Fall Creek
a ) . Exemption
Chairman Hoffman suggested that the option to exempt
the site had not been pursued with vigor by the City. when
Matt McHugh was approached two looming deadlines may have
influenced his response about the possibilities for
protecting the Fall Creek Site from development. First, the
congressional year was drawing to a close and second, the
obligatory referendum for developing the site was to take
place in November. Hoffman believes that faced with these
two factors and no clear sense of what the Ithaca voters
wanted, Congressman McHugh had no reason to pursue the
exemption.
Hoffman pointed out that two things have changed since
the first request to Congressman McHugh. First, FERC
granted the city a two-year extension of the construction
deadline. Second, the referendum passed ensuring the city' s
control over the site for at least the next two years.
Hoffman felt that the results of the referendum had not sent
a clear mandate for hydropower to the Common Council. In
fact, now that the project economics are becoming more
difficult to predict the Council may wish to consider a new
recommendation from the Hydropower Commission to petition
Congressman McHugh for a federal exemption. Hoffman
suggested that he would write such a recommendation for the
Commission to consider at its next meeting.
b) , wheel the Power - to Other Utilities or to City
Facilities
Wheeling the generated power by sending it along NYSEG
distribution system to other utilities or the City may be
possible. Helen reports that the city has the option of
sending generated power to city buildings and operations,
such as the city garage or the sewage treatment plant, along
NYSEG lines free of charge. The city may send power through
NYSEG' s lines without charge to any facilities within a mile
of the proposed plant. The power could then be used to
offset the city' s electric costs.
Selling power to other utilities by wheeling it through
the NYSEG system would involve transmission costs that vary
according to distance to customer. Helen mentioned both
Niagra Mohawk and Long Island Lighting Company as potential
customers, though the city has had no contact with them
about this option. Although bidding specifications from
these or other utilities may be more favorable than those
proposed by NYSEG, gains in power sales may be offset by
wheeling charges.
It may also be possible to develop the Falls
cooperative with Cornell, with Cornell as consumer of the
power. However, Martin Sampson pointed out that Cornell
currently sells all generated power from its Beebe Laxe
plant to NYSEG. Members of the Commission were uncertain
about the attractiveness of this idea to Cornell.
c) . A Smaller Plant
Chairman Hoffman noted that plants designed to generate
less than 2 megawatts of power will be exempt from price-
setting through bids. He suggested that a smaller plant
than that specified in the license would be a further option
for Fall Creek.
Helen concluded the discussion by saying that if the
economics of the project were unfavorable, the city would
surrender their license to build.
5. Ithaca Falls Project Timetable
The construction deadline for the Ithaca Falls project
is September, 1991. Helen reported that the city will need
at least nine to ten months to complete the engineering
design and detailed study leading up to construction.
Design and study will be preceded and followed by soliciting
bids and contracting for the work at all phases. The two
year extension allows for a comfortable margin of time
between now and when construction would begin, though much
many tasks be completed between now and then.
Helen suggests that, beyond negotiating with NYSEG, all
plans are awaiting resolution of the project costs and
returns.
6 . Six-Mile Creek Projects
a) . 60 Foot Dam
In order to retain the license to develop this site,
the city must complete a dam safety study by January 9,
1989 . The study is extensive and costly (estimated $10 , 000 )
and the Common Council has already refused to authorize
funds for this purpose. Both for lack of time and lack of
funds the study will not be completed by the deadline.
The Commission passed a motion that City surrender its
license to FERC.
b) . Van Atta' s Dam
This small plant will be exempt from bidding because of
the proposed amount of power generated. A private
developer, Bill Allen, is very interested in this site. The
city has the options of either developing the site or
leasing it to a private developer. Either option would have
to be approved in a Spring referendum, though (as with the
Fall Creek site ) a referendum may not be mandatory for a
leasing arrangement. Construction must begin by March, 1990
to meet the requirements of the license.
7 . Approval of Previous Minutes
The Commission reviewed two sets of minutes from
meetings held on August 10 and August 30 . The minutes from
August 10 were approved. Those from August 30 were reviewed
and the Commission suggested some amendment and editorial
work before approval.
8 . Next Commission Meeting
The next Commission meeting will be held on January
17th, 1989 .