Preliminary permits have been approved and feasibility studies are under way for a proposed multibillion dollar hydroelectric power station that would be located on the banks of the Minnesota River near Granite Falls.
The new power project was proposed earlier this year by Golden Valley-based Nelson Energy group. According to Douglas Spaulding, co-founder of Nelson Energy, two sites near Granite Falls are being considered because of their proximity to two major transmissions lines and the Minnesota River.
Spaulding called the massive energy project a power storage project rather than a power plant, as it adds very little to the power grid. Instead, the main design of the project is to provide load balancing to the power grid during periods of high energy need. If an electrical grid calls for more energy, it can take days for coal and nuclear plants to reach peak production, Spaulding said. Hydro-electric plants take minutes.
"Hydro-electric turbines are the most responsive type of generation available," he said. "They can fluctuate their power in seconds."
The proposed hydro-electric plant would involve boring 1,800 feet down into granite bedrock forming six water-storage "galleries" deep below the earth's surface. Water would drop through pipes from an 135-acre 30-foot-deep upper reservoir on the bank of the river down into six lower reservoirs, generating emission-free electricity by passing through four 250-megawatt turbines in the process. Each of the six lower galleries would be 150 feet high, 1,000 feet long and capable of storing in excess of 1 billion gallons of water.
The water would be stored in the lower reservoir until off-peak energy hours. Then, at night, the water would be pumped back up to the upper reservoir using cheap off-peak energy sources such as wind turbines.
Wind energy reaches peak generation at night during off-peak energy hours, Spaulding said. Currently, technology is limited to store that energy. The hydro-electric pump system would use that off-peak energy to draw the water back up into the upper reservoir, essentially storing the energy until peak energy-intensive hours during the day when the reservoir can again be drained over a six-hour period to the lower galleries to generate electricity.
The project is still in its early stages.
Nelson Energy and its partner on the project, Toronto-based Riverbank Power, submitted preliminary permits with the Federal Energy Regulatory Commission (FERC) for two sites to the north and east of Granite Falls. The companies are currently conducting feasibility and environmental impact studies as part of a lengthy government permitting process to get the project approved.
The permit outlines a number of guidelines to be followed during the environmental study citing "significant potential environmental impacts." According to the document, the companies are expected to conduct a full environmental analyses under the National Environmental Policy Act.
Spaulding expects the environmental impact to be minimal.
Water to initially fill the reservoir would be drawn from the Minnesota River, but Spaulding said they could wait until periods of high water to draw from the river and that the overall impact on the river would be minimal. Very little water beyond the initial fill-up would be needed, but small amounts may be drawn to compensate for evaporation.
"Any energy source that you have has impacts associated with it," Spaulding said. "You pick your impacts and you pick your power source."
The general concept behind the plant is nothing new. According to Spaulding, at least 35 pump storage projects exist in the United States with many more installed abroad.
"It's an old technology but it's coming into view now because it can take unreliable power sources and make it reliable," Spaulding said. "It increases our reliability on wind energy while smoothing the ups and downs of power generation."
It could take up to five or six years for FERC to issue a permit for the project and another five years to build the estimated $2 billion, 2,000-megawatt structure. At this stage the project is still not a sure thing. Spaulding said that future interest rates and power markets will determine if the project moves forward.
The extended time-table also makes financing for the project tricky, Bob Larson, a manager at Nelson Energy, said. With six years or more before construction, Larson said they cannot count on government subsidies being available. Instead they must rely on private sources to fund the project. Nelson Energies partner in the project, Riverbank Power, may finance initial costs, but additional investors will be needed before the project moves forward. Larson said he hopes energy companies and electrical grid managers see the benefit of the project and assist in funding the project in the future.
With such staggering figures at stake, Spaulding said he remains optimistic that the plant will continue to be in demand in the future.
"It makes sense for the markets and what we know today," Spaulding said. "It's always a leap of faith, but it looks like a project in the right place right now, and that's why we're pursuing it."
