By Natalie Johnson
Shelto-Mason County Journal
PUD 3 has a 10-percent stake in electricity produced at Energy Northwest’s Packwood Lake Hydroelectric Project but staffers said this week that an effort to increase productivity at the site will be scrapped due to an inability to secure stimulus funding.
The Packwood Lake Hydroelectric Project in Lewis County, was built in 1964 and produces 94 million kilowatt-hours of electricity annually. PUD 3 owns ten percent of the power produced at the Packwood project, which they sell to other utility companies. The profit from these sales can lower utility rates for consumers, said PUD 3 Power Supply Manager Jay Himlie.
"When the stimulus stuff was going around they (Energy Northwest) put in for a grant based on a previous study to say, "We think we can achieve some efficiency improvements at our facility,” Himlie said.
In order to receive stimulus funding for the project, they would have had to guarantee to the federal government that the improvements would increase productivity at Packwood by at least five percent, according to Energy Northwest.
Energy Northwest had many of its member utilities, including Mason County PUD 3, planned to increase productivity at the project by redesigning the way that the underwater turbine turns water pressure into electricity. Himlie said that this involved the creation of new parts, which no U.S. company could manufacture — a requirement for stimulus funding.
"They couldn’t find any U.S manufacturers, and then for a while they thought they might have a deal if they hired a U.S. manufacturer who sublet some of the work to somebody in a different country,” he said.
However, once Energy Northwest found a manufacturer to do the work, they couldn’t guarantee a five percent increase in productivity. According to Energy Northwest, one of the upgrades involved replacing a part of the turbine, which might have only given a 1.5 percent increase in productivity.
It might be 4.5 or 4.8 percent, but they can’t guarantee the five percent,” Himlie said. "So you would spend all the money to make all the improvements and if the tests proved that it was less than five percent, then you didn’t get the federal grant.”
Himlie explained that Energy Northwest and PUD 3 would have to pay for the upgrades out of pocket, and would then be reimbursed with stimulus money if the project met the criteria to receive a stimulus grant.
Because a five percent gain in productivity could not be guaranteed, Energy North-west decided to shelve the project for the time being.
If it had been successful, Himlie said, the gain in productivity would have helped stabilize power rates especially during peak usage.
By 2012, public utilities must get three percent of their electricity from renewable energy resources, and in 2016, that number jumps to nine percent. While hydroelectric power is not considered renewable, Himlie said any increase in productivity in an existing hydroelectric project would count towards the required nine percent, and help the city achieve their overall goal.
While the redesign has been shelved, Energy Northwest representatives say they are exploring other, cheaper ways to increase the productivity of the Packwood project, which would not require stimulus funding.