Government Spending Choices
[Headline from DRJ]
Alaska village will install new river power generator:
ANCHORAGE, Alaska (AP) — A tiny Native village in southwest Alaska has turned to an emerging technology to transform the power of a local river into a sustainable energy source that’s expected to free residents from dependency on costly diesel fuel.
The village council in Igiugig is the first tribal entity in the nation licensed by the Federal Energy Regulatory Commission to harness river water that’s not connected to a dam. That means the community of 70 is authorized to proceed with the complex project and that the system went through rigorous reviews by state and federal agencies, according to a U.S. Department of Energy official working with the village.
“It’s a huge milestone,” said DOE engineer Steve DeWitt, who manages the agency’s water power projects. He said a similar non-tribal system will be installed next year in New York City’s East River. But that river is tidal, not continuously flowing like the Kvichak River in Igiugig, he said.
***
The $4.4 million project is being paid for by state and federal funds, matching funds from the village and a development investment from Ocean Renewable, according to participants. Participants say U.S. Sen. Lisa Murkowski, R-Alaska, strongly supported the project and helped secure funding for it. Murkowski is the chair of the Senate Committee on Energy and Natural Resources. Committee spokeswoman Tonya Parish said Wednesday that Murkowski, fellow Republican U.S. Sen. Dan Sullivan of Alaska and Maine Sens. Susan Collins and Angus King wrote to Energy Secretary Rick Perry last year to urge the Energy Department to fund the project.
Read the whole thing.
I don’t have the expertise to tell if this is a PC government boondoggle or a worthwhile and creative attempt to provide reliable energy to appropriate areas. I hope it is the latter but the Bridge to Nowhere (which may have been overblown) has made me think twice about government spending, so I want to know more.
By the way, I am not trying to pick on Alaska. This is an interesting project and, to me, it makes an interesting post.
— DRJ
Water turbines are a well-established technology for hydropower generation in dams, so this doesn’t sound like some pie in the sky Solyndra boondoggle.
From the article, it appears they are getting 80 kilowatts of power for $4.4M. That’s roughly 100 times what an 80 kilowatt diesel generator costs, but obviously the main advantage is that it eliminates the cost of fuel.
A quick web search found 80 kW diesel generators that use about 7.3 gallons of diesel fuel per hour. Generators use tax-free (“red”) diesel which currently goes for $2.45/gallon in the lower-48, although it must cost quite a bit more to deliver it to a remote place in Alaska.
From this back-of-the-envelope estimate, it looks like it would pay for itself in 15-30 years (or somewhat sooner if you include the environmental benefits of not transporting and burning diesel).
If this is the first use of a technology that could have wider applicability (eventually at reduced cost from economies of scale) then that would justify going ahead even if you only more or less break even. The Wright brothers’ first flight wasn’t profitable either!
Dave (1bb933) — 7/18/2019 @ 6:05 amIt is really simple. If it made economic sense, then taxpayer subsidies would not be needed. That the senator wants to “bring home the bacon” does not change that.
Frank (90a91c) — 7/18/2019 @ 6:07 amIf externalities could be neglected, perhaps.
Dave (1bb933) — 7/18/2019 @ 6:13 amYou don’t need Hoover Dam to power a water-wheel. Millers have been using knee-deep rills to turn millstones for millennia.
nk (dbc370) — 7/18/2019 @ 6:15 am“The Wright brothers’ first flight wasn’t profitable either!”
Dave (1bb933) — 7/18/2019 @ 6:05 am
The Wright brothers didn’t fleece the taxpayers to get it off the ground.
Munroe (0b2761) — 7/18/2019 @ 6:16 amI agree and this sounds like it may be the case here. But why start there, in such a remote and challenging environment, especially when the one supportive resident they quoted only lives there half the year?
I am suspicious this is a fairly reasonable venture tainted by politics and PC (who in DC doesn’t like Native Americans or wooing the Independent Murkowski?).
DRJ (15874d) — 7/18/2019 @ 6:22 amAlso, Dave, thank you for walking through that analysis. It helped me a lot.
DRJ (15874d) — 7/18/2019 @ 6:25 amThey had a federal contract less than five years after their first flight.
Dave (1bb933) — 7/18/2019 @ 6:41 amThe Amish do this kind of stuff all the time whenever and wherever they are. Their religion does permit them to use electricity, what it forbids is being on the grid. But I doubt that a project like this would cost them much more than 1% of the government price. They would dig the millpond and weir and put the plant together themselves from local materials, buying only the generator and wiring.
nk (dbc370) — 7/18/2019 @ 6:49 amDRJ,
As Dave pointed out, the cost of diesel fuel is low, and in the lower 48 this project might not have a payoff period within its mechanical lifetime. In remote parts of Alaska, the 32,000 gallons of fuel (roughly 120 tons) needed every year would have to be delivered by aircraft. I’m betting that comfortably more than doubles the cost.
Kevin M (21ca15) — 7/18/2019 @ 6:52 amThe machinery for the turbine would also have to come in by aircraft, and that adds to the price, but only once.
Kevin M (21ca15) — 7/18/2019 @ 6:53 amI think the choice of this locality could be because the amount of power from a couple units is significant. Putting this first, relatively expensive installation in the lower 48, where there is ample coal- and NG-powered generation capacity would make less economic sense. Diesel is less efficient, and thus a better candidate for replacement.
I doubt this project was initiated by national politicians. The article said there was a Department of Energy R&D project, and
Dave (1bb933) — 7/18/2019 @ 6:56 amI know fuel is expensive there, in part because they do have to fly it in so that brings the cost to $7 a gallon. Plus, I know I would rather have hydropower than diesel.
Maybe overcoming somewhat harsh conditions are part of the test, or maybe they wanted a river that doesn’t freeze over. But why choose a place like this for the prototype?
DRJ (15874d) — 7/18/2019 @ 7:07 amYou addressed some of my thoughts before I even said them, Dave! But:
1.) I do not believe there was no politics involved. It is all about politics in DC.
2.) There are plenty of places this might make a difference. The article also says the next installation will be in the NY East River.
3.) This little village has 70 people, some of whom apparently only live there part-time. Is this really the best use of $2.3 M in federal funds?
DRJ (15874d) — 7/18/2019 @ 7:13 am1) Of course there are political elements to this… we’re talking about $$$ here.
whembly (fd57f6) — 7/18/2019 @ 7:32 am2) Sure… but, why not trying it in those remote areas as well? At least we can see if it succeeds there.
3) These *small* endeavors ought to be encourage in the spirit of finding the best solutions possible. This is almost a “bottoms up” approach that is markedly different than the huge boondoggles we’re used to seeing (bridge to now, Solyndra, etc…).
Absolutely true, but won’t the same remoteness that makes it so expensive to fly in diesel also inflate the costs of this prototype?
DRJ (15874d) — 7/18/2019 @ 7:37 amI should have looked around more before posting this because this is an ongoing project and the harsh conditions are part of the test:
DRJ (15874d) — 7/18/2019 @ 7:46 amMaybe I am too cynical about government spending.
DRJ (15874d) — 7/18/2019 @ 7:46 amNo, DRJ, the additional information you posted makes it sound more like pork and make-work to me. Or, better, swill with a lot of mouths in the trough.
nk (dbc370) — 7/18/2019 @ 7:58 amTo build on Dave’s comment, the average cost of diesel in Alaska is $3.18/gallon but, because Igiugig is so isolated, it’s probably closer to $4.00/gallon. The price in Kodiak is $3.82/gallon.
Paul Montagu (dbd3cc) — 7/18/2019 @ 9:09 amTo me, this means the project will pay itself off closer to the lower end of the range, or 15 years, maybe sooner. Do a Google map search on Igiugig. It’s really isolated. They probably do have to contractually ship the diesel in.
Regarding the Bridge to Nowhere, totally blown out of proportion. Again, go to Google Maps. Ketchikan butts up against a mountain range, with hardly any room for growth or expansion. The bridge would still allow container and cruise ship traffic, but also open up the very large Gravina Island to development. The bridge is expensive, but everything in AK is expensive.
The present cost of diesel is irrelevant: its subject to fluctuation, delay and interruption. Installing a water powered source is not only sensible, its why Washington state has such cheap power-hydroelectric units at dams.
Sounds like a great decision.
Harcourt Fenton Mudd (6b1442) — 7/18/2019 @ 10:34 amSpeaking of Alaska…
This could be a story idea after Banshee has had its run.
Paul Montagu (dbd3cc) — 7/18/2019 @ 12:34 pmSpeaking of spending, here’s a non-campaign ad campaign ad from … Mark Sanford.
Mark Sanford presidential campaign ad(?): We have a fiscal crisis whether we want to admit it or not
Allahpundit leads with the sad but obvious: “LOL at this guy trying to win righties over with something other than brute lib-triggering.”
Still worth watching, if only to remember back to that time in distant past when it was possible to hear somebody discuss policy issues like an adult.
Dave (1bb933) — 7/18/2019 @ 3:49 pmFrom a link on Sanford’s page, here a little toy you can play with to fix the Federal budget:
http://www.crfb.org/debtfixer/
Dave (1bb933) — 7/18/2019 @ 4:32 pm