Hydroelectric Plan Gains Steam

May 22 - Cincinnati Post

Hamilton's desire to construct and operate a hydroelectric facility on the Ohio River is gaining momentum.

Earlier this month, the city filed a request with the Federal Energy Regulatory Commission to obtain a license to build and operate a hydroelectric facility at the Meldahl Locks and Dam, located downstream from Cincinnati on the Ohio River.

Until recently, the federal license to move forward with the estimated $250 million project had been held by Augusta, Ky. But in early March, however, the commission terminated Augusta's license because the city had failed to develop the project since receiving approval to do so in 1995, according to FERC filings.

Hamilton had competed against Augusta in the early 1990s for that license, submitting design documents and feasibility studies that cost the local electric system about $375,000, officials have said. This week, the commission rejected Augusta's attempt to regain the license, citing in its official decision that it "is in the public interest to allow other entities the opportunity to develop the Meldahl site, rather than once again reserving the site for some period of years to Augusta, which has hitherto not shown the ability to move forward with the project."

At least one other electric provider, Louisville Gas and Electric, is known to be interested in the license, Hamilton officials said.

However, LG&E is a privately-owned utility and federal regulations call for municipally owned utilities to receive preference when it comes to handing out such operating licenses, according to officials with the city of Hamilton.

"LG&E is interested, but by federal statute, Hamilton has preference," said Mark Brandenburger, Hamilton's deputy city manager. "There may be others out there that are interested, but we are not aware of any at this time."

Meanwhile, Hamilton has received a resolution of support from American Municipal Power of Ohio, a nonprofit corporation that represents the interests of publicly-owned utilities across the state.

If Hamilton were to secure federal approval, American Municipal Power would work with other public utilities in Ohio to help finance the project, said Kent Carson, director of member relations for the organization.

"Until it moves along farther, there's really not much more we can do," Carson said. "With other hydro projects that we've worked with, we have helped go out and get our members to commit to purchasing the output (electric) from the facility or participate in whatever project costs there are."

As the state's largest municipally owned utility provider, Hamilton provides electric, gas, water and waste water service to more than 60,000 local customers. Already, the city owns a hydroelectric facility in Greenup, Ky., near the Greenup Locks and Dam more than 100 miles upriver from Cincinnati. Officials have touted the operations at Greenup as key to stabilizing Hamilton's electric rates.

Unlike the electricity produced at the city's power plant, which has been impacted significantly by increased costs of coal and steel, power generated from Greenup comes in at a fixed price, officials have said.

Greenup is the largest hydroelectric facility on the Ohio River. Brandenburger said the Meldahl facility would supersede Greenup.

In addition, he said a Meldahl operation, unlike Greenup, would provide a "huge" generation of electricity due to the constant water level that is contained in the area.

Greenup, officials have said, is vulnerable to dry spells and flooding that impedes hydroelectric generation.

City officials expect a decision from federal regulators by the end of the year.