ISSUE #45 .... Aspen's New Hydro PLANT: A Big Waste of "Green"

"We never know the worth of water till the well is dry."   --  Thomas Fuller, Gnomologia, 1732

This issue of The Red Ant is focused exclusively on the Castle Creek Hydroelectric Plant that many of you have inquired about.  You've seen the construction occurring this summer in the Marolt Open Space and along Power Plant Road.  This was all approved in a public vote in 2007, but you can be sure that there's a lot more to the story today!    ASPEN: THE BEST LIT CITY IN AMERICA, CIRCA 1890... According to the Aspen Historical Society, in 1885, Aspen became the first city west of the Mississippi River to harness hydroelectric power for lighting homes, businesses and streets.  The Aspen Times wrote, "The Aspen Electric Light Company turned on the current and some forty business places were instantly lighted."  Pretty impressive for a little mining town in the middle of the Rocky Mountains!    The original Castle Creek hydro plant in Aspen opened in 1893 as one of America's first hydro plants.  Fed by flumes from both Castle and Maroon creeks, the plant produced most of Aspen's power for 65 years.  The Castle Creek hydro plant was closed and decommissioned in 1958.   ... AND NOW Aspen still gets much of its electricity from hydro.  The city's municipal energy supply is 45% hydroelectric, sourced by the Ruedi Dam and Maroon Creek hydroelectric facility.   The Aspen water system contains over 75 miles of water distribution lines, 1100 water valves, 14 water storage tanks, 565 fire hydrants, 15 pump stations and 60 pumps, 3 municipal wells, 2 water treatment plants and 16 separate pressure zones that serve over 3500 customers in Aspen and Pitkin County.   In addition to operating the potable municipal water supply system, the city operates a pressurized untreated water system that serves the school campus, Rotary and Iselin Parks, and provides water for snowmaking at Aspen Highlands.  The treated municipal water system provides water for snowmaking on Aspen Mountain.  (During 2006 approximately 36 million gallons of treated water were used for snowmaking.)  The total storage of treated drinking water in Aspen is 9.66 million gallons.   THE 2007 VOTE Referendum 2C on the November  2007 ballot read:  Shall Aspen debt be increased by up to $5,500,000, with a maximum repayment cost of $10,780,000 by the issuance of general obligation bonds for a new hydroelectricity plant on Castle Creek?  The referendum passed 582-230 -- that's over 70% of Aspen voters who voted yes.  Did you vote for it?  This issue of The Red Ant will illustrate just what you authorized.  Or what you didn't.    THE CASTLE CREEK HYDRO PROJECT The Castle Creek hydro plant will produce up to 5.5 million kilowatt hours (kWh) annually, providing the city with 8% of its electricity needs -- enough to power 655 homes.  This hydroelectric offset translates to a 0.6% reduction in carbon emissions community-wide, the equivalent of over 5,000 tons of CO2.   To harness this capacity, the project also requires re-vamping the 1,800 square foot, 19th century powerhouse facility below the Castle Creek Bridge.   Will the new hydro plant reduce the price of electricity?  According to city public works director (and economist?) Phil Overeynder, "There is definitely a higher upfront cost, but, a hydro plant can be amortized over 20 years, and, with a lifespan of 50 years, we get 30 years of at-cost energy."   HOW IT WILL WORK? The project will utilize existing water rights, head gates and water storage components of the original Castle Creek hydroelectric plant.   Larger 42" penstock (pipeline) is currently being installed in order to divert water from Maroon and Castle Creeks for inflow into Thomas Reservoir, a 15-acre-foot retention facility that serves most of Aspen's water needs.  The new penstock will increase the inflow capacity to 25 cubic feet per second (CFS) from Castle Creek and 27 CFS from Maroon Creek for a total of 52 CFS inflow - more than doubling current capacity.  The new penstock will also upgrade the outflow from Thomas Reservoir to the Castle Creek hydro plant, and includes diverting the water 1 mile farther downstream to the plant before being discharged back into the stream.   The turbine and generator at the hydro plant will convert the force of water - falling 325 feet from the Thomas Reservoir - into electric power.  The electricity will be placed on the city's power grid and sold to the city's electrical authority which will then resell it to local consumers.  The plant is projected to produce enough power for the city to decrease its purchase of electricity, resulting in an annual increase of $300,000 in electrical utility revenue.   SHOW ME THE MONEY According to the prospectus on the bond offering dated September 10, 2008, the cost and funding sources of the hydroelectric plant break down as follows:   $6.2 million cost $5.5 million in general obligation bonds $400,000 grant from Community Office for Resource Efficiency (CORE)* $300,000 from the city's Electric Enterprise Fund The general obligation bonds are payable from available electrical utility fees and ad valorem property taxes levied by the city.  What this means is that if/when electricity revenues do not cover the debt service, property taxes will be increased to cover the shortfall as a matter of course.  The term of the debt is 27 years (2035), with a repayment value of just under $10 million.   In other words, the Aspen hydro plant is a no-risk financial proposition for a city not known for its financial management prowess.   *CORE is an Aspen-based non-profit that promotes renewable energy, energy efficiency and green building in western Colorado and beyond.   A RED ANT PRIMER ON RIVERS AND STREAMS IN THE ARID WEST A water year runs from October - September.  And as you can imagine, here in the Roaring Fork Valley there is a natural dramatic fluctuation in water flow levels that maintains the habitat.  Springtime (April/May) brings increased water from snowmelt, usually peaking in June (700-900 CFS), followed by a slow decline, with August/September levels (100 CFS) declining through the fall (40 CFS) and returning to the lowest levels that last throughout the winter (below 20 CFS).    During peak run-off season, there is an essential flow of water over and above the riverbanks and onto the floodplain to be soaked up by the soil.  Without this moisture, plants and critters in the riparian habitat cannot survive.  These plants include the plants and trees (cottonwoods, dogwoods, etc) that shade the rivers and streams and whose roots hold the banks stable.  Without these trees, the water will carve downward into the stream bed (instead of flooding over the banks), causing the end of the lush vegetation and enabling the invasion of non-native, invasive species of dry (brown) grasses.   In the winter, water levels are naturally very low, and this is very stressful to the eco-system.  If the stream levels get too low, the water can freeze, killing the may-flies, cactus-flies and stone-flies (a.k.a. fish food).  And the fish (Castle Creek has four varieties of trout:  Rainbow, Brown, Brook and Mottled Sculpin) -- they spend the winter in semi-hibernation in deep pools in the river.  Low water levels make it so the pools can also freeze -- not good for fish survival. There is currently a healthy quantity of good-sized trout in Castle Creek, which shows that there exists a good source of food and healthy water levels.       HOW LOW CAN WE GO? Castle Creek is a very diverse stream - it's wide, steep and varying in shape. There is a critical minimum level of water for Castle Creek -- 12 CFS is the state's minimum capacity level based on a 1974 decree.  As part of its internal analysis, the city recently hired Bill Miller of Miller Ecological Consultants, Inc. to conduct a $48,000 aquatic biology study to determine the effects of taking water from the creek.    Requested by the Colorado Division of Wildlife, the study was conducted to evaluate the effect of stream-flow changes between the point of diversion (4 miles upstream of the plant) and the point of return to the creek.  Miller determined that the minimum stream flow should be 13.3 CFS downstream of the diversion to protect the river ecosystem, and 17.2 CFS downstream of the plant to the confluence of Castle Creek and the Roaring Fork River.   Even with Miller's increase in minimum water levels, is this a healthy approach to sustaining our vital water resources and the surrounding ecology?  13-17 CFS is nothing.  Just envision 15 CFS (1' x 3' x 5') across a 20' stream bed.  Should we really be looking for the lowest possible in-stream flow level?   THE EFFECTS OF CLIMATE CHANGE The Roaring Fork Conservancy cites the nexus of global warming, natural variability and human growth will put "unprecedented pressure on water resources in the west in the 21st century, and set a broader context for assessing the present state of the Roaring Fork watershed and planning for its future."   According to John Kratzenberger of the Aspen Global Change Institute, predictions are that Aspen's run-off will start earlier and peak sooner.  As a result, water levels will become lower earlier and last longer.    So, what does this mean for Castle Creek with a new hydroelectric plant?  Ask yourself -- when is peak energy season for hydro-electricity production?  Yes, late spring/early summer.  Climate change is predicted to make our hot, dry season longer, stressing the stream all the more, even without a hydroelectric plant.  Hmmm.  Should we really be doing this??  For just 8% of our electricity??   SENIOR WATER RIGHTS - DOES THE CITY STILL HAVE THEM?? The city's director of public works regularly asserts the city's "senior water rights" and therefore its ability to do as it pleases.  At a public meeting in early June, he affirmed, "I could legally reduce the CFS level to zero."  How charming. Even council made the decision to honor a minimum stream flow level, despite not legally having to do, claiming "senior water rights."    However, this may not be the case exactly.  According to Colorado law, water right abandonment could become a critical barrier to Aspen's hydro plant plans: Non-use of a water right alone will not result in a finding of abandonment - there must be non-use coupled with intent to abandon the right. Intent, shown either expressly or by implication, is always the critical factor in an abandonment determination. Colorado law provides that failure to apply water to a beneficial use for a period of 10+ years creates a rebuttal presumption of abandonment. Once a presumption arises, the burden of proof shifts to the water rights owner to prove that the right was not abandoned.  Acceptable justifications for long periods of non-use are limited.  Owner must provide evidence that constitutes more than the mere declarations of a desire or intent to resume use sometime in the future. Non-use for an unreasonable period combined with insufficient evidence of intent not to abandon will result in the court declaring the water right abandoned. It would seem that the city's Castle Creek hydropower water rights are likely abandoned: The city admits they have not used the rights in approximately 50 years. The city made a deliberate decision to source its power needs from the federal power grid and discontinue the use of its hydropower water rights. The city decommissioned its hydropower plant and dismantled the turbines. The city removed portions of the original penstock, and the remaining portions cannot deliver water to the plant without being entirely rebuilt. A group of Castle Creek homeowners has retained the services of local water rights attorney Paul Noto, who has advised them not to grant interviews with the press amidst ongoing "discussions" with the city.  The Red Ant says, "YAY!"  There is strength in numbers when concerned citizens unite to confront the city with facts and formality.  Sadly, however, this often entails the retention of counsel in order to be taken seriously.    The Red Ant has located some archived comments by attorney Paul Noto on the subject of the Castle Creek hydro project: "If the city touts itself as an environmental leader, it ought to engage in a full environmental study." "The city's goal to create hydropower should not come at the expense of the streams, the wildlife and individuals who own water rights in those bodies of water." "The city-commissioned study is essentially asking 'What's the least amount of water that can be left in the stream without killing fish?'  I don't think that's the right question." As The Red Ant is fond of saying, "Ya think?"   WHAT'S REALLY GOING ON?  Penstock (pipeline) replacement conducted under false pretenses. City officials repeatedly claim that the current $2.3 million penstock upgrade project is a vital Thomas Reservoir emergency evacuation line that will "potentially aid in hydropower production." Strangely, according to a source who has asked to remain anonymous, safety engineers at the state don't even recognize Thomas Reservoir, and it has certainly never been noted as any kind of safety threat.   But the city's story sounds good - upgrade the old pipeline for alleged "safety" reasons and voila, the increased capacity just so happens to be appropriate for the hydro-electric plant!  This $2.3 million investment is definitely not one for safety, but rather a "we've already done that" step as part of an "end run" to get a federal permit to operate the plant.   The city wants a special exemption for their project; never mind they put the rest of us through bureaucratic hell for ours. All this "safety" propaganda incidentally also creates a nice convenience for the city - an upgraded conduit to "safely" drain the reservoir may qualify the city for what's called a "conduit exemption" for the hydro project that will enable it to circumvent federal laws and regulations.  This means that the city's application to bring its hydro project online could be more expeditious and less expensive than a new hydro license application with the Federal Energy Regulatory Commission (FERC).  And, the environmental requirements are less stringent with a conduit exemption - no environmental impact statement (EIS) and no environmental assessment (EA) are required.  Another egregious claim by the city is that their environmental analyses are the same as those that would be required by an EIS and an EA, the only difference being that the city will oversee these studies themselves.  (Oh good, just like they oversee the elections!?!) Questionable financial rationale (what a surprise!)  It seems so obvious, but somehow the voters, the local papers and concerned citizens missed it.  If the plant generates $300,000 annually and this is to be used to cover the debt service on the bonds (unless that's not enough at which point property tax increases kick in to cover the tab), just what is the annual debt service??   In 2009, it was $356,500.  In 2010, it will be $357,800.  Yep, it's true -- revenue from the hydroelectric plant will NEVER cover the debt.  The city knew it all along.  The ad valorem property taxes were designed from the start to cover the shortfall.   Plant will regularly be shut down one-third of the year.  The hydro plant will make power during peak season when it's feasible to generate a minimum of 300-400 kilowatt hours.  When water levels are too low for this to be achieved, the plant will be turned off and power production will cease.  Water levels are at such levels from January through April, therefore the hydro plant will be shut down 4 months of the year.  So, does the provision of 8% of Aspen's electricity needs take into account the 4 month shutdown?  Or with the shutdown, is the provision more like 5.3%??   New energy will be used to draw water UPHILL from the water treatment plant. As part of its municipal allocation, hydro plant-generated energy will be used to move water uphill from the ACSD (the water treatment plant on the Roaring Fork River) to irrigate the golf course, to power hot and cold heat exchangers at Burlingame (the notorious over-budget subsidized housing project) and other city irrigation projects.   The hydro plant is a misguided attempt by the city to meet unrealistic environmental benchmarks at the public's expense.   The city's Canary Initiative requires that by 2015, Aspen be 100% reliant on renewable energy sources, and by 2020 Aspen have a neutral carbon footprint.  These are obviously well-intended goals, however the "canary in the mine" symbolism ought to be focused as much on the cost of achieving these ambitious goals as their "green-ness" in order to qualify (and survive). Otherwise, costly and foolhardy projects will be undertaken, with predictably negligible and wasteful results.   Focus is on minimum vs. optimal water levels.  If the hydro plant is built, water levels will be reduced to the minimum stream flow level for several additional weeks at the beginning and the end of the low water season before diversions are stopped.  What is OK?  Does OK mean the minimum level for mere survival?  Or do we want to maintain the existing ecology?  What about optimal?  An artificial level is certainly not optimal.  What is optimal?   City council to determine acceptable water levels.  Perhaps the most frightening fact of all: the questions of when diversions should stop and how much water should be left in the creek above minimum amounts will ultimately be decided not by riparian experts, but by ..... city council.  Yep, city council.  Even The Red Ant can't make this up.   COMMUNITY VOICES   In a continuing effort to include diverse opinions on the subject at hand, this issue features a submission by Sally Spaulding, community relations director for the city of Aspen, as well as a letter from the archives of the Aspen Daily News from long-time local Kevin Patrick that ran on November 2, 2007, just prior to the vote to fund the hydro plant.  (Patrick's letter was provided to The Red Ant by a Castle Creek homeowner who, on the advice of counsel, could not personally write in.)  And of course, The Red Ant opines at the end.....   SPAULDING  Why is the City interested in hydropower? ·        The City of Aspen is absolutely committed to caring for the environment, which is why we are interested in building the Castle Creek hydro facility that will reduce CO2 emissions by about 5,000 tons per year.  The project was approved by Aspen voters by 77 percent in 2007. ·        A hydro project ran in almost the exact same location from the 1800s to the 1950s. The City already manages a Maroon Creek hydro facility, which we built in the late 1980s, and we get hydro from Ruedi Reservoir as well. About 75 percent of Aspen's power comes from renewable sources, and we have goals to reach 100 percent while still keeping rates lower than most Colorado utilities. I've heard that building a hydro facility will harm Castle Creek. Is that true? ·        No. We are NOT moving forward with the Castle Creek hydro project without considering the health of Aspen's streams. That's why we commissioned an additional study to give us a benchmark for how to keep Castle Creek healthy while still producing clean, renewable power. ·        The study showed that the suggested healthy stream flow in Castle Creek, for the stretch where the hydro project would take water out of the stream and divert it for power production, should be 13.3 cubic feet per second (cfs). A lot of people hear that number and freak out, but what that number means is, if the stream goes down to that level for a little while but maintains higher "flushing" flows at other times of the year, it will still be healthy. (As a side note, the current state requirement is only 12 cfs in Castle Creek, so 13.3 would be a voluntary increase.) ·        The most the City can ever take out of the stream is 25 cfs. Think about June when the river is running at 700 cfs... and the 25 cfs is a tiny amount. In other times of the year, like in the winter months, it's different. We learned from the study that we should leave 13.3 cfs of water in the stream during those low times to keep it healthy. If we see that diverting water for hydropower during those low times would take the stream below 13.3, that's when we shut down. We're not going to produce hydropower at the expense of the stream's health. ·        Some of the neighbors in the area, understandably, aren't excited about this project. There are construction impacts and fears about what the stream will look like. What we're asking them, and the community, to do is to trust that we will continue to be good stewards of the environment. We simply want to operate the hydro project in a way that makes sense for the environment on all fronts - from reducing our carbon footprint to keeping the stream healthy. But rather than debate the merits of the Castle Creek Energy Center here, we invite you to be involved in the public process!  The public process so far has involved several community meetings as well as public hearings in front of Aspen City Council. The next public hearing is scheduled for August 9 at Aspen City Hall. Can't make it? You can watch the meeting online at www.aspenpitkin.com (click on "Watch Webcasts"). You can also click here (http://www.aspenpitkin.com/Living-in-the-Valley/Green-Initiatives/Renewable-Energy/Hydroelectric/) to find out much more about the project.   PATRICK This is my first editorial after living here quite a long time (30 years next year).  I have always avoided writing (or reading) letters to the editor, but the present initiative to authorize the conversion of open space to a hydroelectric plant and to authorize bonds to fund $5,100,000 toward a new hydroplant deserves comment.  This sounds like a very "green" project.  However, it is wasteful and irresponsible.  The claim is that it will produce renewable electricity and utilize excess water rights of the city.  Those goals sound good, but they will not be achieved.  Voters should be aware:   1)            The city's water rights have not been used for this purpose in generations; in all likelihood under Colorado law they have been substantially abandoned.  The facility will likely sit unused, a waste of tax dollars.  To authorize expenditures before the feasibility of a project is resolved is irresponsible. 2)           Diversion of water under a new water right would adversely impact the minimum instream flow on Castle Creek, contrary to the other goal of the city of maintaining instream flows. 3)           Use of open space for an industrial use is a bad precedent. 4)           The city's "Canary Initiative" (a laudable goal, if implemented responsibly) is not met here.  Climate change and carbon emissions are not just local issues, they are global issues.  Therefore, the city's approach of merely considering relative impacts of producing energy from a hydroplant against those of a fossil fuel plant reveal a lack of understanding of these legitimate issues.  In assessing carbon loading issues, responsible programs review: a) emissions from the mining of raw materials; b) emissions from transporting the raw materials to manufacturing; c) emissions from manufacturing the raw materials; d) emissions from transporting the finished materials to the site; e) emissions from construction impacts; and f) emissions from long term operations.  It is only this last component that the city looks at.   The city's golf course "reuse" irrigation project is an example of how poorly the Canary Initiative goals are applied.  There, rather than use gravity to provide irrigation water to the golf course, as was historically done, the city plans to pump water more than two miles uphill to irrigate the same land.  The city merely funded and constructed, without regard to the long term costs of the project (energy or environmental) or the fact that it did not have the water rights to accomplish the stated goals.  The Castle Creek Hydroplant Project appears to be a project in the same vein.  People familiar with the water industry avoid lifting water uphill significant distances; it is a costly perpetual waste of energy.  If private enterprise sought to spend your money without undertaking the requisite due diligence, you would never give them your money...so why would you give them your vote?   THE RED ANT SAYS:  Gee, it sure feels good to "go green," doesn't it?  A friend once said, "There's a special place in hell for people who don't support green, renewable energy."  But there's a point when you just have to say - Are you kidding me??    You know something's rotten in Denmark when the city's public works director is the one espousing the economic upsides of a major multi-million dollar energy project!  Overeynder recently (and confidently) asserted that not only are "the economics of the project" good, the "debt service is (also) good, but I can't guarantee it."  Swell.  And so convincing.   How on earth are the economics "good" when the revenues generated will never once cover the annual debt service??  The Red Ant says, "Those economics are LUDICROUS."    Once again, in Aspen, debt financing is seen as free money.  This endemic sickness has so deeply permeated our culture that "raise property taxes" and "float a bond" have become synonymous with "make it happen."  The geniuses we've elected to lead us continue to perpetuate this ideology.  Councilman Skadron wrote a letter to the editor in support of the hydro plant, glorifying Aspen's ability "to produce its own clean, cheap power."  Yep, $6.1 million is cheap when you don't have to foot the bill!  And then there's Mayor Mick, who's never met a green idea he didn't like.  Since he's never one to question cost or source of funding, Mick proudly asserts, "I am supporting anything I can do that cuts our carbon footprint."    The Red Ant simply cringes when reading propaganda (notably The Aspen Times' endorsement of Referendum 2C) that states one benefit of the hydro plant is that some 5,000 tons of CO2 emissions will be "removed from the atmosphere."  Right.  Aspen's hydro plant will simply suck that bad stuff right out of the sky.  Just because Aspen cuts its (already small) purchase of coal-fired energy by up to 8% from the MEAN (Municipal Energy Agency of Nebraska) producers does not mean that they will cease to produce this same amount!  Puh-lease.  It will just be sold to someone else, somewhere else. And it will still end up in the atmosphere.  While Aspenites go out and hug a tree with the naïve belief that building a hydro plant will "remove" CO2 emissions from the atmosphere, they'd be far better served by looking up the definition of "vacuum cleaner" in a dictionary.  The hydro plant is a lot of things; an atmospheric vacuum cleaner is certainly not one of them.   Aspen, stop the madness. Ask questions!  Demand answers!  Our elected leadership jammed this pet project, its funding mechanism and its reckless stewardship of river ecology through on a warm, fuzzy green platform without fleshing out the facts or the numbers.  They simply dangled the "green" bait, and Aspen bit.    The Red Ant will analyze the issues for future elections, but the big lesson here is: be informed. And remember, if it sounds too good to be true, it generally is.  Do a quick cost-benefit analysis.  Is the proposed benefit worth the cost?  What is the cost?  And who will pay?  What else is at risk?    There are still legal pitfalls (such as the water rights issue) and ecological impacts that could derail the hydro plant, but the bonds were issued in 2008 and the money is already being spent.  Shouldn't these issues have been raised and resolved BEFORE the vote?    Plan to attend the next public hearing on August 9 and ask the important questions!   Ironically, the hydroelectric plant issue was on same ballot with the much maligned Instant Run-off-Voting (IRV) process.  Both won in landslides.....