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Hydropower

ATB data for hydropower are shown above. These projections are based on projections developed for the Hydropower Vision study (DOE, 2016) using technological learning assumptions and bottom-up analysis of process and/or technology improvements to provide a range of future cost outcomes. The projections use a mix of EIA technological learning assumptions, input from a technical team of Oak Ridge National Laboratory researchers, and the experience of expert hydropower consultants. Cost projections are derived independently for non-powered dam (NPD) and new stream-reach development (NSD) technologies.

The three scenarios for technology innovation are:

Conservative Technology Innovation Scenario (Conservative Scenario): no change in CAPEX, OPEX and capacity factor from 2018 to 2050
Moderate Technology Innovation Scenario (Moderate Scenario): incremental technology learning, consistent with the Reference case in the Hydropower Vision study (DOE, 2016); CAPEX reductions for NSD only
Advanced Technology Innovation Scenario (Advanced Scenario): gains from pushing to the limits of potential new technologies, such as modularity (in both civil structures and power train design), advanced manufacturing techniques, and materials, consistent with Advanced Technology in Hydropower Vision (DOE, 2016); both CAPEX and O&M cost reductions implemented.

Resource Categorization

Hydropower resources can be categorized into broad groups depending on analytical needs and technology characteristics. The following hydropower categories are included in the 2020 ATB:

Powering Non-Powered Dams (NPD): These are existing dams that do not currently have hydropower. Previous studies have estimated up to 12 GW of technical potential of U.S. NPD based average monthly flow rate over a 30-year period, and a design flow rate exceedance level of 30% is assumed. However, financial decisions in recent development activity suggest the economic potential of NPD may total approximately 5.6 GW at more than 54,000 dams in the contiguous United States. (Technical potential encompasses technologically feasible sites; economic potential includes only those where economic benefits exceed economic costs to society; market potential includes those where financial benefits exceed financial costs.) Most of this potential (5 GW, or 90% of resource capacity) is associated with fewer than 700 dams.
New Stream Development (NSD): These are greenfield hydropower developments along previously undeveloped waterways (DOE, 2016). The resource potential is estimated to total 53.2 GW/301 TWh at nearly 230,000 individual sites (Kao et al., 2014) after accounting for locations that are statutorily excluded from hydropower development, such as national parks, wild and scenic rivers, and wilderness areas. In general, NSD potential represents smaller-capacity facilities with lower head than most of the historical data. These characteristics lead to higher CAPEX estimates than past projects, as many of the larger, higher-head sites in the United States have been previously developed. New hydropower facilities are assumed to apply run-of-river operation strategies. Run-of-river operation means the flow rate into a reservoir is equal to the flow rate out of the facility. These facilities do not have dispatch capability.
Upgrades of Existing Facilities (NSD): These are existing hydropower infrastructure investments that have the potential to continue providing electricity in the future through upgrades (DOE, 2016). At individual facilities, investments can be made to improve the efficiency of existing generating units through overhauls, generator rewinds, or turbine replacements. In particular, as plants reach the license renewal period, upgrades to existing facilities to increase capacity or energy output are typically considered. The bulk of upgrade potential is from large, multi-megawatt facilities, with a total of total of 6.9 GW/24 TWh (at about 1,800 facilities) based on a series of case studies or owner-specific assessments (DOE, 2015).

Scenario Descriptions

In general, differences among the technology innovation scenarios in the ATB reflect different levels of adoption of innovations. Reductions in technology costs reflect the cost reduction opportunities, and the Hydropower Vision study (DOE, 2016) includes road map actions that result in lower-cost technology. The tables below provide an overview of potential hydropower innovations.

Summary of Technology Innovation: Moderate Scenario (2030)

	Learning by Doing
Technology Description	Widespread implementation of value engineering and design/construction best practices
Impact	Facility cost reduction
References	(DOE, 2016)

Summary of Technology Innovation: Advanced Scenario (2030)

	Modularity	New Materials	Automation/Digitalization	Eco-Friendly Turbines
Technology Description	"Drop-in" systems that minimize civil works and maximize ease of manufacture reduce both capital investment and O&M expenditures	Use of alternative materials in place of steel for water diversion (e.g., penstocks)	Implementation of standardized "smart" automation and remote monitoring systems to optimize scheduling of maintenance	Research and development on environmentally enhanced turbines to improve performance of the existing hydropower fleet
Impact	Civil works cost reduction	Material costs reduction	Reduced maintenance cost	Reduced environmental mitigation costs
References	(DOE, 2016)	(DOE, 2016)	(DOE, 2016)	(DOE, 2016)

Representative Technology

In the 2020 ATB, CAPEX is shown for four representative non-powered dam plants and four representative new stream-reach development plants. CAPEX estimates for all identified hydropower potential (~700 NPD and ~8,000 NSD) results in a CAPEX range that is much broader than that shown in the ATB. It is unlikely all the resource potential will be developed because of the very high costs for some sites. For the 2020 ATB, all potential NPD and NSD sites are first binned by both head and capacity. Analysis of these bins provided groupings that represent the most realistic conditions for future hydropower deployment. The design values of these four reference NPD and four reference NSD plants are shown in the table below. The full range of resource and design characteristics is summarized in the ATB data spreadsheet. The reference plants shown below were developed using the average characteristics (weighted by capacity) of the resource plants within each set of ranges. For example, NPD 1 is constructed from the capacity-weighted average values of NPD sites with 3–30 feet of head and 0.5–10 MW of capacity. The weighted-average values are used as input to the cost formulas (O'Connor, Zhang, et al., 2015) in order to calculate site CAPEX and O&M costs. Regional cost effects and distance-based spur line costs are not estimated.

Upgrade potential becomes available in the ReEDS model at the relicensing date, plant age (50 years), or both. For this reason, hydropower-specific upgrade projections are not included in the 2020 ATB.

Design Values of Representative Hydropower Plants

	Resource Characteristics Ranges			Technology Characteristic
Plants	Head (feet)	Capacity (MW)	Head (feet)		Capacity (MW)	Capacity Factor	Intake	Water Conveyance (feet)	Transmission Access (miles)	Powerhouse	Turbine Type
NPD 1	3–30	0.5-10	15.4		4.8	0.62	New/Existing	<250	<5	New	Axial
NPD 2	3–30	10+	15.9		82.2	0.64	New/Existing	<250	<5	New	Axial
NPD 3	30+	0.5-10	89.6		4.2	0.60	New/Existing	250-500	5-15	New	Francis
NPD 4	30+	10+	81.3		44.7	0.60	New/Existing	250-500	5-15	New	Francis
NSD 1	3–30	1–10	15.7		3.7	0.66	New	Site Dependent	5-15	New	Various
NSD 2	3–30	10+	19.6		44.1	0.66	New	Site Dependent	5-15	New	Various
NSD 3	30+	1–10	46.8		4.3	0.62	New	Site Dependent	5-15	New	Various
NSD 4	30+	10+	45.3		94.0	0.66	New	Site Dependent	5-15	New	Various

Methodology

This section describes methodology to develop assumptions for CAPEX, O&M, and capacity factor. Click on these links for standardized assumptions for labor cost, regional cost variation, materials cost index, scale of industry, policies and regulations, and inflation.

Capital Expenditures (CAPEX)

Definition: Based on EIA (2016) and the system cost breakdown structure described by O'Conner et al. (2015), the hydropower plant envelope is defined to include items noted in the table above.

Recent Trends: Data from the literature, which includes 7 independent published studies and 11 cost projection scenarios within these studies, were reviewed. See the historical and literature review charts below. An attempt is made to identify potential CAPEX reduction for resources of similar characteristics over time (e.g., estimated cost to develop the same site in 2015, 2030, and 2050 based on different technology, installation, and other technical aspects). Some studies reflect increasing CAPEX over time and are excluded from the 2020 ATB based on the interpretation that rising costs reflect a transition to less attractive sites as better sites are used earlier. Literature estimates generally reflect hydropower facilities of sizes similar to those represented in U.S. resource potential (i.e., they exclude estimates for very large facilities). Due to limited sample size, all projections are analyzed together without distinction between types of technology.

For CAPEX estimates represent actual and proposed projects from 1981 to 2014. Year represents the commercial online date for a past or future plant.

Normalized CAPEX acronyms include IEA-ETSAP=International Energy Agency (IEA)-Energy Technology Systems Analysis Program (ETSAP); IRENA = International Renewable Energy Agency; NPD = non-powered dam; NSD = new stream-reach development

Base Year: CAPEX for each plant is based on statistical analysis of historical plant data from 1980 to 2015 as a function of key design parameters, plant capacity, and hydraulic head (O'Connor, DeNeale, et al., 2015).

NPD CAPEX = (11,489,245 × P^0.976 × H^-0.24) + (310,000 × P^0.7)

NSD CAPEX = (9,605,710 × P^0.977 × H^-0.126) + (610,000 × P^0.7)

Where P is capacity in megawatts, and H is head in feet. The first term represents the initial capital costs, while the second represents licensing. Actual and proposed NPD and NSD CAPEX from 1981 to 2014 (O'Connor, DeNeale, et al., 2015) are shown in box-and-whiskers format for comparison to the ATB current CAPEX estimates and future projections.

Estimates of CAPEX for NPDs in the 2020 ATB based on the above equations range from $3,800/kW to $6,000/kW. These estimates reflect facilities with 3 feet of head to more than 60 feet of head and from 0.5 MW to more than 30 MW of capacity. In general, the higher-cost sites reflect much smaller-capacity (< 10 MW), lower-head (< 30 ft.) sites that have fewer analogues in the historical data, but these characteristics result in higher CAPEX. The Base Year estimates of CAPEX for NSD range from $5,500/kW to $7,900/kW. The estimates reflect potential sites with 3 feet of head to more than 60 feet head and from 1 MW to more than 30 MW of capacity. The higher-cost ATB sites generally reflect small-capacity, low-head sites that are not comparable to the historical data sample's generally larger-capacity and higher-head facilities. These characteristics lead to higher ATB Base Year CAPEX estimates than past data suggest. For example, the NSD projects that became commercially operational in this period are dominated by a few high-head projects in the mountains of the Pacific Northwest and Alaska.

Future Years: Projections developed for the Hydropower Vision study (DOE, 2016) using technological learning assumptions and bottom-up analysis of process and/or technology improvements provide a range of future cost outcomes. Three different CAPEX projections are developed for scenario modeling as bounding levels:

Conservative Scenario: NPD and NSD CAPEX unchanged from the Base Year; consistent across all renewable energy technologies in the 2020 ATB
Moderate Scenario: consistent with the Reference case in the 2016 Hydropower Vision:

NSD CAPEX reduced 5% in 2035 and 8.6% in 2050. These estimates are not imposed in the 2020 ATB. There is an ongoing effort to update the cost estimates, and this would support future ATB scenarios.
NPD CAPEX unchanged from the Base Year

Advanced Scenario: consistent with the Advanced Technology case in the 2016 Hydropower Vision:

Low-head NPD/All NSD CAPEX reduced 30% in 2035 and 35.3% in 2050; Low Head NPD is NPD-1 and NPD-2.
High-head NPD CAPEX reduced 25% in 2035 and 32.7% in 2050; High Head NPD is NPD-3 and NPD-4.

Use the following table to view the components of CAPEX.

Operation and Maintenance (O&M) Costs

Definition: Operation and maintenance (O&M) costs represent average annual fixed expenditures (and depend on rated capacity) required to operate and maintain a hydropower plant over its lifetime, including items noted in the table below.

Base Year: The core metric chart shows the Base Year estimate and future year projections for fixed O&M (FOM) costs for each technology innovation scenario. The estimate for a given year represents annual average FOM costs expected over the technical lifetime of a new plant that reaches commercial operation in that year.

A statistical analysis of long-term plant operation costs from Federal Energy Regulatory Commission Form-1 resulted in a relationship between annual, FOM costs, and plant capacity. Values are updated to 2018$.

Lesser of Annual O&M = (227,000 × P^0.547) or (2.5% of CAPEX)

Future Years: Projections developed for the Hydropower Vision study (DOE, 2016) using technological learning assumptions and bottom-up analysis of process and/or technology improvements provide a range of future cost outcomes. Three different FOM projections are developed for scenario modeling as bounding levels:

Conservative Scenario: FOM costs unchanged from the Base Year to 2050; consistent with all ATB technologies
Moderate Scenario: FOM costs for both NPD and NSD plants unchanged from 2018 to 2050; consistent with the Reference case in Hydropower Vision
Advanced Scenario: FOM costs for both NPD and NSD plants reduced by 50% in 2035 and 54% in 2050, consistent with the Advanced Technology case in Hydropower Vision.

Use the following table to view the components of O&M.

Capacity Factor

Definition: The capacity factor represents the expected annual average energy production divided by the annual energy production, assuming the plant operates at rated capacity for every hour of the year. Capacity factor is intended to represent a long-term average over the lifetime of the plant; it does not represent interannual variation in energy production. Future year estimates represent the estimated annual average capacity factor over the technical lifetime of a new plant installed in a given year.

The capacity factor is influenced by site hydrology, design factors (e.g., exceedance level), and operation characteristics (e.g., dispatch or run-of-river). Capacity factors for all potential NPD sites and NSDs are estimated based on design criteria, long-term monthly flow rate records, and run-of-river operation.

Recent Trends: Actual energy production from about 200 run-of-river plants operating in the United States from 2003 to 2012 (EIA, 2016) is shown in the historical chart below. This sample includes some very old plants that may have lower availability and efficiency. It also includes plants that have been relicensed and may no longer be optimally designed for current operating regime (e.g., a peaking unit now operating as run-of-river). This contributes to the broad range, particularly on the low end. Interannual variation of hydropower plant output for run-of-river plants may be significant due to hydrological changes such as drought. This impact may be exacerbated by climate change over the long term.

For capacity factor, historical data represent energy production from about 200 run-of-river plants operating in the United States from 2003 through 2012 where year represents calendar year. Projection data represent expected annual average capacity factor for plants with the commercial online date specified by year.

Base Year: Base Year capacity factors for new hydropower plants are assumed to be near the 80^th percentile of the historical range, with a small range, and reflect site-specific expectations for future hydropower plants.

Future Years: The capacity factor remains unchanged from the Base Year through 2050. Technology improvements are focused on CAPEX and O&M costs.

References

The following references are specific to this page; for all references in this ATB, see References.

DOE (2016). Hydropower Vision: A New Chapter for America's Renewable Electricity Source. (No. DOE/GO-102016-4869). U.S. Department of Energy. https://www.energy.gov/sites/prod/files/2018/02/f49/Hydropower-Vision-021518.pdf

DOE, United States Department (2015). Wind Vision: A New Era for Wind Power in the United States. Executive summary March 2015. Report nr DOE/GO-102015–4557, 50 pp.

EIA (2016). Capital Cost Estimates for Utility Scale Electricity Generating Plants. U.S. Energy Information Administration. https://www.eia.gov/analysis/studies/powerplants/capitalcost/pdf/capcost_assumption.pdf

O'Connor, Patrick W., DeNeale, Scott T., Chalise, Dol Raj, Centurion, Emma, & Maloof, Abigail. (2015). Hydropower Baseline Cost Modeling, Version 2. (No. ORNL/TM-2015/471). Oak Ridge National Laboratory. https://info.ornl.gov/sites/publications/files/Pub58666.pdf

O'Connor, Patrick W., Zhang, Qin Fen (Katherine), DeNeale, Scott T., Chalise, Dol Raj, & Centurion, Emma E. (2015). Hydropower Baseline Cost Modeling. (No. ORNL/TM-2015/14). Oak Ridge National Laboratory. https://www.osti.gov/biblio/1185882-hydropower-baseline-cost-modeling

Developed with funding from the U.S. Department of Energy’s Office of Energy Efficiency and Renewable Energy.