Hydro plant could be money-maker

Whitefish Pilot

The Whitefish City Council on Monday indicated it supports spending $535,000 to get its hydroelectric plant up and running again, but with audits showing shortfalls in the water and sewer funds, the expenditure might not survive the upcoming budget process.

Whitefish consultant Jeff Arcel, of Mother's Power Inc., estimates that when completed with a new turbine, generator and other improvements, the city's hydroelectric facility could produce enough power to serve 150-200 average homes.

The new system should have an effective operating life of 30-40 years and produce 35 percent more power than the original equipment installed at the city reservoir in 1983, public works director John Wilson told the council. Wilson recommended including the needed $535,000 in the city's water fund budget for fiscal year 2010.

The funding would cover the $395,00 estimated cost of a new turbine, generator and control equipment, as well as $50,000 for changes to the intake structures, 15 percent for design costs and 5 percent for negotiations and contingencies, Wilson said.

According to Arcel's lengthy analysis and report, the city has a leg up toward getting back into the power generation business:

¥ The diversions, pipeline, powerhouse and other infrastructure are already in place and in good shape.

¥ The city already possesses the required permits and licenses.

¥ And the 12-inch pipe delivering water from First, Second and Third creeks on Big Mountain possesses sufficient flow and pressure to "generate meaningful amounts of clean, renewable energy."

"Unfortunately, there are no records for the seasonal flow variations for the First, Second and Third creek water sources," Arcel's report states. "This complicates the task of developing accurate estimates for the power potential of the Whitefish Hydro System."

City workers began taking daily readings to establish seasonal flow on March 7. In the meantime, Arcel used the 760-foot drop and the maximum 2,500-gallon flow in the penstock to produce a theoretical power output. From that, he turned to Canyon Hydro, of Deming, Wash., which manufactures a 235-kilowatt unit that could replace the existing 190-kilowatt system.

"It may be possible to repair the existing system and restore it to operation," Arcel's report states. "However, it will be a very difficult and time-consuming process fraught with the potential hazard and risk of making mistakes during reconstruction of the turbine and controls."

Estimates to repair the existing equipment ranged from $16,000 to more than $165,000, but serious damage occurred to the equipment on two occasions. Within the first few years of its operation, debris entered the turbine and damaged the pelton wheel. A new pelton wheel manufactured by a foundry in Anaconda was used at the Whitefish plant, but a lightning strike in either 1989 or 1990 burned parts of the generator and put the facility out of operation.

"It is noted in the city's own records that the system was generating approximately $50,000 per year in revenue back in 1990," Arcel's report states. "If the existing system had been producing an average of $50,000 per year consistently since its installation, it would easily have produced more than $1 million in total revenue to date."

W.H. Edelman, of Ronan, operating as Hydro Management Inc., first approached the city about installing the hydroelectric facility in 1982. Working with another company, Hytech Hydro Inc., three very similar facilities were set up in Montana — the one at the Whitefish city reservoir and two in Philipsburg, which continue to operate.

Hydro Management proposed building and operating the Whitefish hydroelectric facility at their own expense and eventually transferring ownership to the city, but the company ceased operations and filed for bankruptcy in 1989.

"The failure of Hydro Management was the primary factor that led to the hydro system's current dysfunctional state," Arcel's report states. "Hydropower systems require regular and consistent operational procedures and maintenance to function properly. Once Hydro Management went into bankruptcy, the owners effectively walked away from the system, and there was no longer anyone with the knowledge or experience required to care for the system."

Flathead Electric Cooperative is interested in working with the city on the project, Arcel said, and it's likely Co-op power rates could increase by 12-25 percent by 2011 and continue rising along with the national average after that. But that's not a sure bet.

"FEC is accustomed to long-term power purchase agreements at very low rates," Arcel's report states. "How much they may be willing to pay the city of Whitefish for electricity produced by the Whitefish Hydro Plant is still an open question."

The council directed Wilson to consider the funding needed to get the hydro plant going again in the upcoming budget.