The Final Barrier

The Stanly News & Press published on Tuesday a column I wrote regarding the latest developments regarding the Yadkin Project relicensing. Here's a copy of the column, titled "The Final Barrier":

When you stand atop the Narrows Dam, you can see for miles in every direction. There’s the Uwharrie National Forest and Morrow Mountain State Park, both remarkable for their pristine, undisturbed beauty. Between them flows the water of the Yadkin River.

That water – and four dams constructed along the river by Alcoa – has been the topic of much debate in Stanly County for more than a decade.

Dams, by definition, are a barrier. They capture the water flowing down the river and put it to good use – reservoirs like Badin Lake provide drinking water to local communities, generate clean and renewable energy, create recreational opportunities for people who love to swim, boat and fish, and spur economic development in the surrounding communities.

Alcoa has operated its dams along the Yadkin River for nearly 100 years. But when the company sought a new federal license for its dams, a new set of barriers emerged.

Many people in Stanly County were concerned about the jobs that were eliminated when the Badin plant closed. So shortly after the Badin plant was formally closed in 2010, we immediately began working to redevelop the property. We invested more than $10 million to transform the site into the Badin Business Park, which now ranks among the best industrial sites in North Carolina.

In 2011, Alcoa recruited the nation’s largest electronic waste recycler to Badin. ERI opened a regional recycling center that continues to grow.

Our commitment to jobs helped us reach an agreement with Stanly County last spring. The agreement includes significant investments to support economic development and provides the county with long-term access to clean, affordable water to support the county’s growth. We are now working in partnership with the county to recruit new jobs to the Badin Business Park.

In addition, we continue working to make Stanly County a better place to live. Alcoa awarded scholarships to local high school valedictorians, donated land for a Habitat for Humanity home in West Badin, and donated $20,000 to promote science and technology courses in Stanly County schools.

Only one barrier to a new license remained: obtaining a water quality certificate (known as a 401) from the NC Department of Environment and Natural Resources that recognized Alcoa’s commitment to meet state water quality standards.

In August, the agency was prepared to issue a 401 certificate for the Yadkin Project.

Our investment in new technology at Badin Lake had resulted in significant water quality improvements. In fact, our annual monitoring now shows that water leaving the Yadkin Project was meeting key water quality standards that will take affect once a new license is issued for the Yadkin Project.

With a proven technology in place and a commitment to spend an additional $80 million to fund further improvements upstream, Alcoa had successfully demonstrated its commitment to water quality.

After months of public hearings and careful evaluation by water quality professionals, DENR was ready to act. It prepared a copy of the 401 certificate and notified us about the impending announcement.

But a new, unexpected barrier emerged.

Gov. McCrory claimed the state owned the land under our dams and filed a lawsuit against Alcoa. His administration inserted itself into the regulatory process and insisted that DENR deny our 401 application.

So, once again, we find ourselves in a familiar place: fighting for the right to run the dams we built on the property we own. It’s a clear threat to our property rights – and the rights of anyone who owns property along a waterway in North Carolina.

For Stanly County, the lawsuit has unfortunate consequences.

It will further delay benefits such as the expansion of Morrow Mountain State Park, the development of a new waterfront park in Badin, the donation of land for a new water treatment plant, the funding of future economic development initiatives, and a host of other benefits for those who live or play on the lakes.

But our commitment to this community remains steadfast.

We will continue working to improve water quality and protect the beautiful natural resources along the river. We will continue providing time and money to support worthwhile causes in the community. And we will continue paying property taxes on the land we are fighting to protect.

We didn’t pick this legal fight, but we are prepared to defend our property rights in court. No matter how long it takes. 

Alcoa Investments Improving Water Quality at Yadkin Project

Water quality at the Yadkin Project has improved dramatically since we invested more than $5 million in turbine upgrades and other enhancements specifically designed to increase the amount of oxygen in the water.

That's the finding of a report on water quality that APGI released this week. It shows that water discharged from the Narrows Dam contains the highest concentration of dissolved oxygen — a key indicator of water quality — since we began monitoring water quality in 2007. This demonstrates that the Yadkin Project’s water quality is consistently improving, as measured by state standards for dissolved oxygen that will take effect when we receive a new federal license.

Why is this important? It's further evidence that the Yadkin Project deserves the state water quality certificate it was issued in 2009. A water quality certificate is a requirement for receiving a new FERC license.

We have installed new technology at three turbines at Narrows Dam, and water discharged from Narrows would have met the new state standard 100 percent of the time in 2011 — a 115 percent improvement since the majority of the work at Narrows was completed in 2007. We were confident that this technology would significantly improve dissolved oxygen conditions and it has.

In addition, APGI has committed to invest up to $80 million more to continue improving water quality at the Yadkin Project, beginning with a $40 million investment at High Rock Lake. Once we complete those upgrades, the Yadkin Project will fully comply with state water quality standards.

Click here to read the press release.
Click here to view the complete report.

Progress at the Yadkin Project: Part 2

A couple weeks ago, I started a blog series to talk about the progress we've made over the last few months. In the meantime, we've had several good news stories that I posted, but I'd like to get back to sharing our progress. Earlier, I talked about sharing our financials and our operating expenses. Today, I'd like to cover how we've addressed water quality concerns.  There are two parts to this issue:

DO Report: We have been monitoring dissolved oxygen (DO) levels at the Yadkin Project for several years and are encouraged by the results. We shared the 2010 Dissolved Oxygen Report with the NC Division of Water Quality (DWQ) on January 14. The results show that instantaneous DO levels for water leaving the Yadkin Project met or exceeded the instantaneous DO standard 99.9% of the time in 2010. The DO daily average level met or exceeded the daily DO standard 97.4% of the time. 

APGI remains committed to meeting North Carolina’s water quality standards and continues to believe that the 401 certification that DWQ issued in 2009 assures those standards will be met. 

401 Water Quality Certificate: We appealed DWQ’s decision to revoke our 401 Water Quality Certificate on January 28. Our appeal will show that DWQ was well informed about our solution for increasing dissolved oxygen levels and that APGI did not withhold important information. 

The resolution of these issues is a necessary first step to implementing the many positive enhancements in the Relicensing Settlement Agreement.

My next blog in this series will cover improving life in Badin.

APGI releases additional information on 401 appeal

On Friday, January 28, Alcoa Power Generating Inc. (APGI) appealed the North Carolina Division of Water Quality's (DWQ) revocation of APGI's water quality certification (401).

Today, we are releasing documentation showing that DWQ was well informed about the equipment in question and its functionality in increasing levels of dissolved oxygen (DO) in the water and that APGI did not withhold important information. 

Please visit our website at www.alcoa.com/yadkin/en/info_page/401_appeal_summary.asp for more information.

Alcoa Power Generating Appeals Water Permit Revocation

Record Shows Full Disclosure; State Decision Based on Incomplete Facts 

Alcoa Power Generating Inc. (APGI) has appealed the North Carolina Division of Water Quality’s (DWQ) revocation of its water quality certification, stating that the agency was well informed about the functionality of the equipment in question and that the company did not withhold material information.

“In its revocation notice, the DWQ quotes selected portions of emails that do not provide the complete story and were taken out of context. If you read the entire email chains in context, and review the entire record, you find that no material information was withheld,” according to Rick Bowen, President, Alcoa Energy.  

A complete review of the emails cited by the DWQ shows that some of individuals who were working on the relicensing and authored these messages were confused at the time of the email exchange, and the points of confusion were cleared up in subsequent emails. For example, during one of the exchanges, a consultant concludes by saying, “This is news to me. Sorry for the confusion.” In another, a consultant states, “As I was looking over the materials again, I must confess I got confused.”

“We have the documentation to show that we were not withholding material information, and that we have publicly shared the operating conditions covered in these messages,” said Bowen.

The record shows that the DWQ was aware that operating conditions and generating levels could affect dissolved oxygen enhancement, participated in multiple discussions over a period of years on the same subject, and was in possession of detailed reports on the effects various operating scenarios had on dissolved oxygen levels,” Bowen said. 

The DWQ revoked APGI’s water quality certification on December 1, alleging that the company withheld information regarding the project’s ability to meet the state’s water quality standard for dissolved oxygen.  Alcoa Power Generating filed an appeal of that decision today. APGI is a subsidiary of Alcoa.

According to documents compiled by APGI, company officials and others discussed the system with the state during at least three Issue Advisory Group meetings attended by DWQ representatives on October 7, 2003, May 4, 2004 and April 6, 2005. The information was also included in APGI’s 2006 Federal Energy Regulatory Commission (FERC) license application, the Final Environmental Impact Statement for the Yadkin Project issued by FERC in 2008, and in multiple Yadkin Project Water Quality reports. 

Some examples include:

• Representatives of the DWQ participated in a Water Quality Issue Advisory Group meeting on May 4, 2004, where there was discussion of the anticipated structure of the dissolved oxygen enhancement and compliance provisions to be included in the 401 water quality certification. At this meeting, the typical operating scenarios at the Narrows development were discussed, as well as the process of how dissolved oxygen increases as the units are operated.
• The Final Environmental Impact Statement for the Yadkin Project issued by FERC in April 2008 reviews how operating conditions and generating levels affect dissolved oxygen enhancement. In it, FERC’s hydropower experts reviewed the results of the enhancement test and drew significant conclusions, such as “tests indicate that this aeration system [at Unit 4] increases DO concentrations by differing magnitudes, depending on the generation flows of each of the Narrows units and whether the two valves are open.”
• The 2005 Yadkin Water Quality Final Study prepared by Normandeau Associates discussed the effect of the operational conditions. The DWQ received and commented on the draft water quality report.

“We hope that our appeal will mean quick reinstatement of the water quality certification process so we can continue to work toward a new license, as well as a future with better water quality and more areas for Stanly County residents to enjoy with their families,” said Bowen.

Once APGI’s license is renewed, there will be many benefits to North Carolina, including improvements to water quality; increased water withdrawals; higher water levels during an extended recreation season; the creation of new parks, swim areas and other recreational opportunities; funding for recreational support; more flexibility for property owners; donations for habitat protection and water safety; and work with community partners for historical and cultural protection. In addition, APGI will sell or donate more than 6,000 acres for conservation, recreation or game lands. 

APGI is also implementing a plan to improve water quality that to date has resulted in significant improvements in dissolved oxygen levels. In a recent report filed with the DWQ, APGI documented that water leaving the Yadkin Project met state standards for dissolved oxygen 99.9 percent of the time.

High Rock board sides with Alcoa for relicense

The Lexington Dispatch has reported that the High Rock Lake Association Board of Directors “unanimously passed a resolution last week confirming the board’s support of a relicensing settlement agreement that would keep the company in control of the Yadkin River and its four hydroelectric dams.”

“We feel the Division of Water Quality withdrew that water quality certificate more out of frustration with the ongoing judicial hearing than because of any real reasons for lack of information,” Len Strong, vice president of the High Rock Lake Association, told the Dispatch. “The information that they’re (state) claiming wasn’t there in fact was there … two years ago. Alcoa made that information totally available to our board as well as to the general public. But the state is claiming, ‘oh we didn’t know.’ So our feeling is this was a political maneuver.”

Strong later added, “There is a gut issue here. More delays means that all of those agreements relative to shoreline management, relative to water levels and so on, are up in the air and not really enforceable. We feel the lack of having that relicensing agreement is depriving all of the property owners and stakeholders from those agreements they worked so hard to get.”

Click here to read the entire article.

Dissolved Oxygen Report Shows Continued Improvement at Alcoa Power Generating’s Yadkin Project

Water Leaving Yadkin Project Meets State Instantaneous Dissolved Oxygen Standard 99.9 Percent of the Time

Water leaving Alcoa Power Generating’s (APGI) Yadkin Project met a state standard for dissolved oxygen levels 99.9 percent of the time in 2010, according to a report submitted last week by APGI to the North Carolina Division of Water Quality (DWQ).

APGI’s Yadkin Project operates four dams along the Yadkin River. Water enters the project area at High Rock Dam, then flows through Tuckertown Dam, to Narrows Dam and exits the project at Falls Dam. The report demonstrates that water coming into the project at High Rock has relatively low levels of dissolved oxygen (DO). But there is a substantial improvement in DO at the Narrows Dam, where APGI installed new technology in 2008 and 2009 to enhance DO levels, and that improvement is maintained until the water exits the Yadkin Project at Falls dam.

The report on dissolved oxygen levels in the Yadkin Project tailwaters shows that discharges from the Falls Dam met the state instantaneous dissolved oxygen standard 99.9 percent of the time and daily average dissolved oxygen standard 97.4 percent of the time. Water coming into the project at High Rock, where a $40 million project to install DO enhancement technology awaits approval of APGI’s operating license by the Federal Energy Regulatory Commission (FERC), met the state instantaneous dissolved oxygen standard 65.1 percent of the time and daily average dissolved oxygen standard 43.1 percent of the time.

“This report shows continued improvement of dissolved oxygen levels in water below the Narrows Dam and demonstrates that new technology installed at Narrows is successfully increasing dissolved oxygen levels in downstream waters. This is true under the full range of unit operation, including ramp up, ramp down and other periods of relatively low operation,” said Kevin Anton, Chief Sustainability Officer for Alcoa. “These results provide reassurance that additional technology enhancements at Narrows and High Rock planned under a new federal license will further increase dissolved oxygen levels as part of our commitment to meet state DO standards.”

An adequate amount of oxygen in the water is necessary to support healthy aquatic life, and many states monitor DO levels as one way to help measure water quality in lakes and rivers.

Under state standards applicable to the Yadkin Project under a new federal license, DO concentrations must meet or exceed 4.0 mg/L when measured instantaneously, and DO concentrations must meet or exceed 5.0 mg/L when measured on a daily average basis.

APGI has developed a comprehensive plan for improving DO levels throughout the Yadkin Project that will cost up to $80 million, depending upon the final requirements. As part of its plan, APGI has been monitoring DO levels since 2007.

The DO report submitted to the Division of Water Quality summarizes the levels of dissolved oxygen measured in the Yadkin Project tailwaters since 2007. Data is recorded every 15 minutes, 7 days a week in the tailwaters of each dam between May 1 and November 30. The measurements are taken during this time period, when DO levels are typically at their lowest, at the state’s request.  Tailwaters are those waters immediately below the dams where dissolved oxygen levels would be influenced by water released through the dams. DO monitors are located in well-mixed areas that are representative of temperature and dissolved oxygen conditions throughout the tailwaters.  Normandeau Associates, a national firm specializing in environmental management and consulting, is responsible for quality assurance/quality control, calibration, maintenance and collection of data from the DO monitors. 

The report shows significant improvements since DO technology was installed at Narrows:

• For the third consecutive year, Falls tailwaters substantially met the state instantaneous DO standard: 99.9 percent in 2010, 99.7 percent in 2009, and 99.5 percent in 2008.

• Narrows tailwaters met the state instantaneous DO standard 93.4 percent of the time in 2010 — a 34 percent increase over 2007 levels (69.6 percent). Since 2007, APGI installed two draft tube air valves on Narrows Units 1 and 2 to improve DO levels. The same technology was installed on Unit 4 in 2001 and will be installed on Unit 3 once a new FERC license is issued.

• Dissolved oxygen levels are enhanced at Narrows even when generating units are operating as low as one megawatt, due to aeration from vacuum breaker valves. The vacuum breaker air valves open when the units are operating at lower settings and introduce air into the water.

• The High Rock and Tuckertown tailwaters met the state DO standard less frequently in 2010. High Rock met the state instantaneous DO standard 65.1 percent of the time, and Tuckertown met the state instantaneous DO standard 56.3 percent of the time.  This could be due annual variability in hydrologic and meteorological conditions or changes in the quality of the water entering High Rock.

The Yadkin Project’s Relicensing Settlement Agreement (RSA) outlines a schedule for installing “through-the-blade" aerating turbines for all three generating units at High Rock once a new FERC license is issued. The engineering, planning, and model testing of the new turbines has been completed and long lead-time items have been ordered. APGI has committed to install additional DO enhancement technology at Tuckertown and Falls if necessary to meet state DO standards.

“We have made great progress and have every reason to believe the technology enhancements will continue to increase dissolved oxygen levels and allow the Yadkin Project to meet the state DO standard,” Anton said. “Our commitment to reaching that goal has never been in question.”

Click here to read the full report.

Alcoa Power Generating to Challenge State’s Effort to Revoke Water Quality Certificate

Alcoa Power Generating Inc. is disappointed and surprised by the state’s plans to start proceedings to revoke the Yadkin Project’s 401 Water Quality Certificate and will immediately challenge the state’s effort, the company announced today.

The certificate, which lays out a plan for APGI’s Yadkin Project to meet water standards, was issued in 2009 by the North Carolina Division of Water Quality and is currently under appeal by APGI and other parties.

“Our team of experts developed a comprehensive plan to improve water quality and we are already seeing improvement,” said Rick Bowen, president of Alcoa Energy. “We do not believe the state’s decision is justified or appropriate.

“We believe that rather than continue litigation, it would be better to work together toward an outcome that protects the environment and promotes economic development and jobs for residents of North Carolina.”

APGI, a subsidiary of Alcoa, is currently applying to the Federal Energy Regulatory Commission for a new operating license for the Yadkin Project. FERC will not issue a license until a 401 Water Quality Certificate is granted by the state of North Carolina. 

In May 2009, the state’s Division of Water Quality issued a certificate that included a plan to install new technology at APGI’s Yadkin Project to improve dissolved oxygen (DO) levels. The installation is not yet complete, but already DO levels are meeting the state’s standards much of the time. At the Falls Dam, for example, DO standards were met 97 percent of the time in 2009

“This same technology is widely and successfully used in the hydropower industry, including more than 15 locations in North Carolina and surrounding states,” Bowen said.

Throughout the 401 application process, APGI worked with state officials, supplying information in the form of monitoring data and other reports to document our approach to meeting water quality standards. No material information was withheld from the state of North Carolina.

“Alcoa Power Generating understands that meeting water quality standards is not optional,” Bowen said. “If the state of North Carolina is concerned that this technology is not adequate, the current 401 certificate contains a ‘reopener’ that allows new conditions to be imposed.

“The state’s decision to revoke our current certificate is unreasonable and was taken without adequate notice or opportunity for response. We plan a vigorous response.”