Nelson Energy to seek license on hydroelectric project in Minnesota

Nelson Energy LLC told the Federal Energy Regulatory Commission in a Sept. 18 update that it plans to file a license application by Oct. 1 on the Coon Rapids hydroelectric project in Minnesota.

The project has completed a draft license application which was submitted to all of the required agencies and 500 residents located around the reservoir area,” said the company. “As indicated in the attached six-month report, [BOST1 Hydroelectric LLC] has entered into a purchase option agreement with Western Minnesota Municipal Power Agency (WMMPA) to acquire, construct and operate the project. BOST1 and WMMPA will jointly negotiate with the Three Rivers Park District to obtain their approval for the use of park land. Subsequent to this approval, a final license application will be filed.”

BOST1 is a wholly owned subsidiary of Nelson Energy. Nelson is a small developer of hydroelectric projects at existing dams. In order to bring the projects to construction and operation, the later stages of project development Nelson identifies a financial partner to finance the project and to ultimately own and operate the facility. Nelson said it has been successful utilizing this strategy for the 10-MW Lower St. Anthony Falls Project which went online in 2011 and the 36-MW Red Rock Project, which is currently under construction. Nelson currently has an option agreement with a large independent power producer to develop the 36-MW Lock and Dam No. 3 project on the Red River in Louisiana.

The Coon Rapids Dam was constructed in 1912-1913 and provided hydroelectric power to the Twin Cities area until 1966. Total original generating capacity was 6.5 MW. In 1969 ownership of the dam and adjacent lands was transferred to the Hennepin County Park District (currently Three Rivers Park District). Since 1969, the dam has been operated by Three Rivers. The City of Anoka obtained a license to install 10 MW generating capacity at the dam in 1987. Construction never happended and the license was terminated in 1990.

During the period from 1969 through 2005 Three Rivers Park District incurred major expenses in maintaining the dam. Major maintenance projects included upgrade of the powerhouse area in 1973, installation of pneumatic gates to replace the existing tainter gates system in 1995 and downstream scour repairs in, 2005 and 2011.

BOST1 in 2010 obtained a preliminary permi from FERC to evaluate the hydroelectric potential at the Coon Rapids Dam. In September 2013, FERC extended the term of the preliminary permit until Oct. 1, 2015. The development activities during the initial term of the permit (from 2010 to January 2013) were delayed due to the uncertain future of the dam and the exact nature of recently-concluded rehabilitation work, Nelson Energy said. The rehabilitation project began in 2013 and was completed in early 2015.

A hydroelectric development utilizing HydroMatrix turbines was completed at the Lower St. Anthony Falls Project in downtown Minneapolis in 2011. This project successfully used a matrix of 16 hydro matrix units in the auxiliary lock structure. These turbines were manufactured by Andritz Hydro. Based upon the information and impacts identified for the initial project design concept, Andritz was requested to review the potential for a HydroMatrix installation at the Coon Rapids facility. Andritz submitted a design proposal which would utilize 16 HydroMatrix units in a newly constructed concrete bulkhead situated in the existing stilling basin downstream of the existing crest gates, Nelson Energy said. The HydroMatrix development plan has been adopted and has been used as the basis of a license application.

An existing 115-KV substation owned by Xcel Energy is located approximately 450 feet away from the powerhouse area. An underground transmission line would be constructed to avoid any impacts to the adjacent recreational facilities.

Over the past six months, BOST1 has been actively seeking a financial partner to address the security concerns and requirements stated by the Three Rivers Park Board. BOST1 has entered into a purchase option agreement with WMMPA to acquire the project. Under the terms of this agreement, BOST1 and WMMPA will work jointly to negotiate an arrangement with Three Rivers to allow the filing of a final license application. The agreement allows WMMPA to acquire the project and then to proceed with construction and long-term operation of the project.

WMMPA is a municipal joint action agency, which supplies power and other electrical services to 62 communities located in Minnesota, North Dakota, South Dakota and Iowa. Nelson Energy, the parent company of BOST1, has previously worked with WMMPA on the $300 million Red Rock project which is currently under construction in Iowa. It is anticipated that the option agreement will be executed prior to Oct. 1.

About Barry Cassell 20414 Articles
Barry Cassell is Chief Analyst for GenerationHub covering coal and emission controls issues, projects and policy. He has covered the coal and power generation industry for more than 24 years, beginning in November 2011 at GenerationHub and prior to that as editor of SNL Energy’s Coal Report. He was formerly with Coal Outlook for 15 years as the publication’s editor and contributing writer, and prior to that he was editor of Coal & Synfuels Technology and associate editor of The Energy Report. He has a bachelor’s degree from Central Michigan University.