A PROFITABLE PRIVATE MICROHYDROELECTRIC PLANT

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Another disaster that had to be guarded against was pipe implosion, which can be caused by the vacuum created behind water flowing from a pipe with its intake closed. To prevent such a calamity, Andy and Bob installed an air bleed near the top of the penstock. A 3"-diameter polybutyl pipe is connected to the 8"-diameter plastic and runs uphill to a point 10 feet above the intake. Thus no water can escape through the tube, but air can be drawn in if necessary.

FINANCES

Dr. Ayers estimates that, if the group hadn't saved money through the use of donated labor and careful equipment selection, the finished price for the site could have totaled more than $50,000. He hastens to add that one cannot, today, hire an engineering firm to develop a plant of this size and expect to make a profit.

As it stands, though, the ratio of dollars invested to KW capacity is quite favorable at Laurel Creek. With just short of $22,000 spent and a delivered output of 17.5 KW, the price per KW is well under the widely accepted guideline of $1,500. In fact, as a point of reference, Laurel Creek Hydroelectric was put on line for less money per KW than it costs a utility company to build a coal-powered plant.

In purely economic terms, the generator will deliver an average of about 132,000 KWH to BREMCO each year, bringing in a gross income of about $4,000 annually. (This figure will, of course, rise as electric rates go up.) Maintenance should be minimal—including bearing lubrication, belt dressing, trash rack cleaning, and inspection—so the major expense to be considered is capital. If the money used for Laurel Creek's construction had been borrowed at prevailing rates (which, of course, it was not . . . being a grant), the system would net about $200 each year (and more as rates rise) for ten years, at which point it would be paid off: From that time until the end of equipment life—a minimum of ten years more—the income produced by the site would be largely profit.

Still, the most difficult aspect of developing a microhydropower site—beyond acquiring or getting access to the necessary expertise—is raising the money. Grants similar to that which provided Laurel Creek Hydroelectric's source of capital have dried up with the "new austerity", and the possibility of federally backed loans is doubtful (the mechanism is there but no funding has yet been provided). And since the costs will run at least $1,000 per KW of capacity, the total sum would add up to more than most folks' savings accounts. Furthermore, banks are likely to be reluctant to make loans, simply because the concept of a profitable small—scale power—generating facility is so unfamiliar. For now, sites such as Laurel Creek offer the best references you can provide to lenders.

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