Maximizing the Value of Hydropower

“You’ve got to be very careful if you don’t know where you are going, because you might not get there.” - Yogi Berra

How do you turn the complexity of investing in and owning hydropower assets into a competitive advantage? At Atrium Economics , we work with investors, owners, and developers to do just that by helping identify/quantify/manage these risks to make optimal decisions. Read below and reach out to learn how we help advance our clients’ hydropower interests.

Think about how unique hydropower is as a generation resource…

• It’s baseload(ish)…
• It can follow load (sometimes, sort of)…
• Water flowing through the turbine doesn’t generate CO2 (but other aspects of hydro are controversial)…
• No two sites are the same (differing in terms of generation profile, environmental impact, competing uses for the waterway, impacts on historical resources, and on many more fronts)…
• It’s one of the few forms of power generation that gets broad support from both sides of the aisle in Washington (yet efforts to streamline and “de-risk” the Federal licensing and permitting of hydro assets have not yet resulted in meaningful improvements, and progress remains evasive)

Add into the mix that roughly 40% of the nation’s FERC-regulated hydropower plants are up for relicensing over the next 10 years, and due diligence, refinancing, and planning for the future of hydropower assets becomes even more complex and challenging. Key questions include:

• How does hydro fit into the energy transition and how will its attributes be valued going forward?
• Will a license be renewed, for how long, and at what cost?
• How are water flows changing given record droughts and changing hydrological conditions?
• What will it take to reach consensus with ever-increasing requirements of resource agencies and stakeholders???
• Will there be pressure to cease hydro operation and potentially return the waterway to its original condition?

With long useful lives, predictable generation profiles, and new FERC licenses that range from 30-50 years, hydro assets can be extremely valuable. BUT, all are not created equally. At Atrium, we help investors, owners, and developers identify and evaluate risks to hydro ownership and relicensing to make prudent, profitable decisions. Reach out to talk about how we can help advance your hydropower goals.

Contact Tom Feldman, Director at Atrium Economics .