Looking through rose coloured glasses, some entrepreneurs approach small hydro development as a licence to print money in a permanent gold mine. Although this sounds more appropriate as an excerpt from a fantasy story, these were just some of the misconceptions about small hydro which were discussed at a recent workshop in the US.

Organised by Waterpower XII in co-operation with Natural Resources of Canada and the international-energy-agency, the workshop looked at the opportunities and challenges small hydro is facing in North America.

‘Generally people look at small hydro through rose coloured glasses,’ Kearon Bennett, president of Ottawa Engineering says. ‘They tend to think that as it is on a small scale it’s not affected by environmental issues. More often than not small hydro is viewed as a long term gold mine.The reality is it can be a tough business.’

In the early 1980s, following the oil crisis of the 1970s and consequent government initiatives to promote smaller renewable generators, small hydro developed at a good pace. But there were problems. Water resources consultant Chuck Howard explains. ‘In the early 1980s people put in capacity that just was not economically justified,’ he said. ‘They built small hydro plants, lost a lot of money and simply gave up.’

Combining their vast experience of developing and operating small hydro plants, panelists at the workshop agreed that small hydro can make money – but it can also be difficult.

‘We know how difficult it is to make money out of small hydro,’ Howard said. ‘You really have to shave the costs on these things.’

Bennett has over 20 years of small hydro experience. He owns a 300kW and a 700kW plant in Ontario and Quebec, Canada. ‘These are very small plants,’ he says, ‘and the particular challenge is to make them cost-effective.’

‘Yes, with the right combination of circumstances the plant can be very profitable,’ independent hydro power consultant Jim Gordon says. But he warns in many cases significant problems can be encountered.

In theory, financing small hydro schemes should be easy. A steady river flow should put the bank manager on your side. ‘But banks have little experience of small hydro,’ Bennett said. ‘They’re nervous. They’d prefer to lend money to someone opening a restaurant instead.’ His advice is to describe a small hydro business as a type of farming venture – farming water. ‘It will help the bank manager understand more if you explain that there will be variations in your crop each year,’ he says.

Small hydro experience in North America has also unearthed potential hydrology problems. ‘The water resource is the fuel that runs our hydro engine,’ says Howard. ‘But many small hydro plants are often sited on ungauged streams.’ The problem here is that most developers do not have the time and money for detailed hydrological engineering studies.

Studying small hydro

IMPS software (the integrated method for power) was developed in the late 1980s. It has been designed to work from topographic and weather data to develop simulated time series records of streamflow on an hourly or daily basis. From this, flow duration curves or power studies of potential plant designs can be made. IMPS proved to be particularly useful for small hydro developers in the mountainous regions of Canadian province British Columbia. Previously, statistical methods had not been successful in estimating stream flow data in ungauged streams.

Experience has shown that hydro developments on a smaller scale can sometimes give a false sense of security – there is the belief that less thorough studies are required. Consequently initial investigations can sometimes be overlooked.

‘You still have to do everything in the same detail as you would for a larger project,’ Bennett says, adding that taxes, insurances and so on are still necessary. ‘Small hydro still involves your environmental studies, and the regulatory and environmental processes are becoming more onerous as time goes on. The environmental side of a small scheme will cost you three to four times as much as the engineering component.’

The importance of effective operation and maintenance, including full appreciation of how much it costs, should not be overlooked. ‘Often the extent of maintenance is not recognised until after the project is commissioned,’ Gordon says, going on to talk about unexpected maintenance requirements.

Giving the example of a small hydro plant which had been added to a drop structure in an irrigation canal, Gordon explains that low penstock water pressure had forced it to shut down the day after commissioning. Investigations revealed that the trashracks had been blocked with tumbleweed which had rolled across the prairie. Consequently an automatic trash cleaner was installed.

Gordon says that maintenance considerations should be taken into account when the plant is under design. Good pointers include:

• Easy access to all equipment, including turbine bearings.

• Access to all vertical shafts, particularly unlined shafts containing equipment.

• Access to the crest and downstream toes of dams, particularly embankment dams.

• Provision to lift all gates suspended in water to deck level.

• Inward opening, high level windows for access to replace broken glass and for cleaning.

• All tunnel openings should be as large as possible.

In many small hydro developments, there are also minimal provisions for equipment maintenance. Some plants have been built without access to the equipment floor, while in others there is barely room to squeeze around the turbine-generator. ‘This is a serious omission,’ says Gordon. ‘It also adds to the cost of maintenance. As with all electromechanical equipment, maintenance is a necessity and becomes more onerous as the equipment ages.’

Minimal requirements would be the ability to back a pickup truck into the power house and offload an oil drum; provision of a small repair bay, with sufficient space to work on a component; and a crane in the power house with at least a motor hoist and manual travel.

It is recognised that a micro hydro plant of less than 100kW capacity could omit the second and third requirements. However, as the size of the turbine-generator increases, provisions for maintenance need to be improved, since delays in completing maintenance will cause significant losses in revenue. Even a rubber tyred, small 3-ton hoist mounted on an I-beam significantly improves ease of maintenance.

Key factors…

…For the successful development of small hydro
• Realistic assessment of project costs and benefits. Good assess-ment methodologies are available such as the IMPs software.

• Solid partnership with good management skills.

• Experience within the partnership. Select only experienced engineers and contractors. If the design engineer does not have sufficient experience in small hydro work ensure an experienced senior hydro engineer can provide guidance.

• Personal and corporate strength.

• Knowledgeable financial institution.

• Design with special attention to operation and maintenance. Small hydro operations can be remotely operated and it is not too expensive to do. Think of factors such as making the power house large enough so there is room should the turbine need taking apart for repairs/maintenance etc.

• Pro-active maintenance plans to minimise expense and downtime.

• Include a contingency fund in the budget to cover any unforeseen expenses.



Tables

Estimated annual costs…