Ben Houston, GroundPoint Engineering
All potential hydropower projects should include an initial rough cost estimate along with computation of the payback period based on the anticipated amount of power that might be generated. As an example:
Maximum Power Potential = 20 kW
Total Potential Revenue from Power= $15,000/yr
Note: you can estimate total potential power using our online power calculator, which takes into account system efficiency, environmental flow requirements, and system availability throughout the year)
Incremental Installation costs for small hydropower projects = $4k-6k/kW
Total Installation costs for 20kW system = $100,000.
Annual cost of maintenance and operation (assume 5%) = $5,000
Dam safety repair and engineering = $200,000
Note this could range from very low to very high depending on the current structural state of a dam. Many small dams in NY are very old, and henceforth may require significant engineering upgrades.
Total cost over 10 years = $350,000
Total revenue over 10 years = $150,000
In this example, the cost of repairing the dam is the main difference in terms of return on investment after 10 years. A similar simple accounting of overall costs and revenues should be done to ensure that your project meets the “gut test” of financial viability before investing significantly in the regulatory and design process.
Some valuable references for researching costs were provided to us by staff at the NYSDEC and include: