US DOE to fund 293 hydroelectric improvement projects across 33 states

The US Department of Energy has selected of 293 hydroelectric improvement projects across 33 states to receive up to $430 million in incentive payments.

The funding will go toward upgrading hydropower facilities that have been in operation for an average of 79 years, the DOE announced Sept. 5.

“This could also potentially increase power generation from the existing hydropower fleet by improving efficiency,” Hilary Bao, S&P Global Commodity Insights senior analyst, said Sept. 6.

Hydropower currently accounts for nearly 27% of renewable electricity generation in the US, as well as 93% of all utility-scale energy storage, according to the DOE. However, the fleet is aging, with many facilities in need of repair and upgrades.

Administered by the Grid Deployment Office and funded by the Bipartisan Infrastructure Law, the Maintaining and Enhancing Hydroelectricity Incentives program will enhance dam safety, improve grid resilience at 215 facilities, and protect 6,000 existing jobs at hydropower facilities as well as contractors and vendors, according to the DOE. The funding includes 84 grid resiliency projects, 149 dam safety projects and 60 environmental improvements projects.

Among the top funding recipients are Southern Co., PG&E Corp., PacifiCorp, Portland General Electric Co. and Seattle City Light. The largest number of projects awarded is in California, with 39, followed by New York, with 35. The projects will not add any significant generation capacity to the grid.

“As our earliest form of renewable energy generation, hydropower has reliably kept America running for almost 150 years -- and the Biden-Harris Administration is ensuring these long-standing facilities can continue the steady flow of clean power,” US Secretary of Energy Jennifer M. Granholm said in the Sept. 5 statement. “Today’s funding will expand and modernize our hydropower fleet, while protecting thousands of American jobs.”

The federal incentive payments will be matched by more than $2.38 billion in private-sector spending, the DOE said. The bipartisan infrastructure law enacted in 2021 added $553.6 million to the DOE's hydropower incentive program. Payments cover up to 30% of a project's capital costs and are capped at $5 million per project.

The DOE anticipates releasing a second round for Maintaining and Enhancing Hydroelectric Incentives during the next calendar year. The Maintaining and Enhancing Hydroelectricity Incentives are complemented by two additional hydroelectric incentives: the Hydroelectric Production Incentives, providing incentive payments to qualified hydroelectric facilities for electricity generated and sold, and the Hydroelectric Efficiency Improvement Incentives, providing payments to increase power generation from the nation’s existing hydropower fleet.