Hydropower

Galen Nelson
Wonderful. Well, thank you all for joining us today. I would like to welcome my guest, Brandon Kibbe, with Great River Hydro, and everyone joining at MassCEC and beyond for the formal launch of our newly branded speaker series, Thoughtful Climate. Here each month, as we have for the last five or six months, we will highlight experts, pioneers, and practitioners from a variety of existing and emerging climate tech sectors and disciplines, as well as subject matter experts who can provide insights into the broader economic, social, and technological dynamics shaping the climate tech industry. Today, we are talking about hydropower, the role it plays in our power system, how a changing climate, and in particular shifting precipitation patterns, are impacting our rivers and hydropower, the role of innovation in hydropower, challenges facing the sector, and more. Before I jump to Brandon, I am going to just set the table briefly for our conversation today.

Galen Nelson
Just to level set, in-state hydropower provides about 2% of the state\'s annual energy needs, about 300 megawatts of clean, dispatchable capacity, about a million megawatt hours annually, provides grid balancing capabilities, and skilled jobs in rural communities. It is worth noting that hydropower generates about 8% of the generating capacity across our entire region, that is, across ISO New England. To put this in perspective, solar and wind combined represent about 7% of generating capacity across New England, hydro about 8%. It is a very important part of our clean energy mix. I also think the history here is really fascinating. I think many are unaware that hydro facilities across the state were most of them originally configured to drive mechanical systems to power the Industrial Revolution. The dams and canals of Holyoke and Lowell are great examples here. They powered mills in the city, converting the kinetic energy from the Connecticut and Merrimack Rivers into mechanical energy, which drove the paper and textile mills in those cities. By the late 1800s, some of those hydro assets in Holyoke, in particular, began producing electricity, but that conversion from mechanical energy to electricity was not completed until 1950. A really fascinating history and a strong connection between hydropower and this state and this region\'s strength with regard to the Industrial Revolution. Let us dive in. A bit of housekeeping before we start for those listening in. As always, feel free to drop questions in the Q&A, and we will be sure to reserve some time near the end and do our best to address those.

Galen Nelson
Welcome, Brandon. I really appreciate you joining me today. Why don\'t you start, if you could, by just introducing yourself and tell us a little bit about Great River Hydro. I know you own assets on the Connecticut and Deerfield rivers, if I am correct. How many facilities and what is that total generating capacity look like? Just love to hear a high-level sketch of Great River Hydro and yourself.

Brandon Kibbe
Sure, great. Thank you very much to MassCEC and Galen for inviting us to join you today. We are excited about this conversation. My name is Brandon Kibbe, I am Vice President of External Affairs with Great River Hydro. I started with the company under prior ownership in 2013. I have been working in a variety of different roles with the company but doing external affairs for Great River Hydro in my current role. Great River Hydro is an owner-operator, an independent power producer in the New England ISO market. We are actually the largest conventional hydropower generator in all of New England. When I say conventional hydropower, I mean not pump storage. We have some pretty interesting facilities located on the Connecticut and Deerfield Rivers in New Hampshire, Vermont, and Massachusetts.

Brandon Kibbe
On the Connecticut River, we have six generating stations and two storage-only reservoirs that reach from the very northern end of New Hampshire, at the very headwaters of the Connecticut River, and Second and First Connecticut Lakes, which are storage-only reservoirs, and then six generating stations located sequentially downstream, extending all the way almost to the Massachusetts line at our Vernon Hydroelectric Station. On the Deerfield River, we have seven generating stations and one storage-only reservoir that stretch. Again, it is almost the same exact system in a much smaller scale. The Connecticut River, of course, is New England\'s largest river, whereas the Deerfield is a small tributary to the Connecticut River. Those facilities stretch from the headwaters at our Somerset Reservoir at the base of Stratton Mountain and flow downstream almost to the confluence with the Connecticut River in Deerfield, Massachusetts, where our Deerfield No. 2 station is located.

Brandon Kibbe
Total capacity of those facilities is about 589 megawatts. We generate about 1.6 million megawatt hours a year in renewable power, enough to power about 213,000 homes. There are a couple of things that make Great River Hydro\'s facilities unique in terms of hydro in New England. Number one is size. These are by far the largest facilities in New England. In fact, we own the two largest conventional facilities by an order of magnitude, which are our Moore and Comerford facilities, 197 megawatts and 168 megawatts individually.

Galen Nelson
In northern New Hampshire and Vermont.

Brandon Kibbe
We also have reservoir storage. When most people think of conventional hydropower, they think of run-of-river hydropower, and that is, in fact, what most conventional hydropower is in New England. We have something slightly different, which is we have reservoir storage located at every single one of our facilities, and the large reservoir at the north end of each system provides us with a tremendous amount of base flow that we then use over and over and over again as that water flows downstream. That sequential location of our facilities allows us to sort of optimize our use of water as it flows.

Galen Nelson
Thanks, that is really helpful. I assume that those reservoirs are also what give you that dispatchable capability.

Brandon Kibbe
That is right. Run-of-river is more of a base flow generator, where it just generates as the water flows to it. As the water continues downstream, we store it in a reservoir, and then we can turn our units on and off when the grid needs our services the most. That dispatchability allows us to be flexible in how we operate within a single day, within a season, within a year. It allows us to modify our operations as the system demand evolves. For instance, as more variable renewables have penetrated the New England market, that has shifted the peaks a little bit further into the earlier morning and later afternoon. We are able to still meet those peaks and generate in those times because we have that flexibility that reservoir storage gives us.

Galen Nelson
That is very helpful. I think people hear that about hydropower, but your additional explanation and clarification is really helpful. I do want to get into a fascinating piece about hydropower, which is this coordination across facilities, not just within one owner, but across owners on the same river. It is not something I think I had really fully contemplated before having a conversation with you and Aaron, Great River\'s CEO, a couple years ago. We will get into that in a bit, but I do want to make sure we maybe back up a bit. What are the core components of a hydro facility? There is obviously a turbine. In the case of many of your facilities, there is some kind of structure, a dam, holding back water. What are the key components? How are these things actually generating electricity?

Brandon Kibbe
I am really glad you touched on the history in the introduction there, because it is important to remember that rivers and hydropower have long powered industry, not just in our region, but globally. It did it originally in a kinetic to mechanical fashion, as you described in the introduction. Even during colonial times, when colonists would build a dam to divert the power of water over a water wheel, that would then turn a shaft that would either turn a grist mill or spin a sawmill. That technology is very old, and it has been used over and over and over again. Not surprisingly, when we discovered how to harness and commercialize electricity in the late 19th century, names that you might recognize, like Edison and Tesla and Westinghouse, they started utilizing hydropower and converting these old kinetic hydropower stations to, instead of turning a grist mill or turning a sawmill, they started turning a generator. They used this technology very early on in the commercialization of electricity.

Brandon Kibbe
Not surprisingly, as a result, hydropower is the longest-tenured generator on the system today. If you looked at the average age of hydropower, it is about 60 years old, a little bit more than 60 years old. Whereas a solar facility might last 20 to 25 years, a wind facility might last that long. Conventional fossil generators might last 30 or 40 years. We have hydropower stations on the Deerfield River in western Massachusetts that came online in 1912. These are very long-tenured facilities.

Brandon Kibbe
Like you described, these all start with a dam. At its core, hydropower uses gravity to generate electricity. Water has substantial mass, and when it falls through the action of gravity, it generates substantial kinetic energy. If you think about it, you take a glass of water, you pour it on your hand, and it is very gentle. If you raise that glass of water up and you pour it down on your hand, it suddenly splashes all over the place. What happens is, as you increase the amount of force that gravity can act on that water, it generates more power.

Galen Nelson
Head.

Brandon Kibbe
Because of the head. In hydro-speak, that is head. We try to stay away from the jargon if we can.

Galen Nelson
We could use some of the jargon on it.

Brandon Kibbe
We will translate. You can increase the more height you can create behind the dam, the height of the reservoir above the river down below, the more power you can generate with the same volume of water. Hydro tries to maximize that to generate the most power it can with whatever volume of water it receives. We have a dam, and that creates the elevation difference, and it can also store a significant amount of fuel in the reservoir itself. Then there is an intake that connects the dam to the turbine generator, and that pipe, the intake and the pipe that connects it, in hydrospeak that is a penstock. That connects the dam to the generator. At the bottom of the generator, you have the water wheel. Attached to the water wheel is a shaft. The top of the shaft is attached to a rotor, and that is a classic spinning generator, which, through an electromagnetic process, generates electricity that then gets transformed with various transformer and control equipment, and then gets delivered to the grid.

Brandon Kibbe
What is interesting is there are lots of different ways you can configure a hydro facility, and at Great River Hydro, we are blessed to have just about every type there is from a conventional hydropower plant. We have everything from a classic, just a dam and a station attached right to it, to a place where we have a dam and a station located two and a half miles away, and the water gets delivered through a solid rock tunnel at a great distance. We have canals and penstocks, and all kinds of interesting configurations. It is amazing; the engineering feats that they were able to accomplish 100 plus years ago.

Galen Nelson
It is. Absolutely incredible. I saw some of the pictures when I visited Holyoke Gas and Electric\'s facility last summer. I looked at some of their historical photos from rebuilding the dam in the early 1900s, and the amount of effort and material put into those projects was absolutely incredible. I wonder if you could just briefly speak to the capacity factor. I assume that varies dramatically based on a variety of factors, including rainfall. On an annual basis, can you give us a sense relative to other renewables? This metric, for those folks tuning in who are not aware, describes the percent, usually over a period of time, usually a year, that a generation asset is actually producing energy.

Brandon Kibbe
It varies widely in hydro. When you talk about capacity factor, it really depends on where you are located in a watershed, the size of the watershed. Generically, I would qualify that as the hydrology of the system that you are operating in, the type of system you are operating, is it run-of-river, is it reservoir storage? You do have a fair amount of variation in hydro. I can say for our fleet, our fleet is about a 30% capacity factor, kind of across the board. Some are more, some are less. When you think about how these were originally developed and how they are operated, you will understand that these were originally developed by New England Power in a vertically integrated utility. When deregulation happened in the late 90s, transmission and distribution remained regulated, but the generating side of the house was spun off into these independent power producers generating in a competitive marketplace. The assets that we manage were built and developed during a regulated timeframe when the cost of those facilities could be passed on to ratepayers as part of a rate base. They were very much over-engineered in a lot of different ways. If you look at our largest facility, our Moore facility, located near Littleton, New Hampshire, 197 megawatts in size, we have five units there. Four of them are the large original ones. One is a new one that came online in 2023 that we added to increase efficiency. Those four original units are almost 40 megawatts apiece, or larger than 41, 40 megawatts apiece. We have four of them that operate. We might operate all four of them all day long for a few days a year during the spring melt, when all the snow melts. Then for the rest of the year, we might run one or two of those units for a few hours a day in order to utilize the peak capability in the peak hours. Over the course of a year, that means we might only be operating at a 25% capacity factor.

Galen Nelson
That is helpful. It\'s good to understand.

Galen Nelson
Why don\'t we just pivot to the workforce? I remember running into some of your team members and thinking about how meaningful those jobs must be, particularly in some of the more sparsely populated parts of Massachusetts and New England. How many folks does Great River employ, and what degrees, what kind of background do they typically have?

Brandon Kibbe
First of all, we have an amazing team. I\'m really lucky to work here and work with the people that we work with. We have a culture of, we are going to get it done, all hands-on deck sort of place. I think the tenure of our staff speaks for what it is like to work here. We have a lot of people, actually, who worked for New England Power that still work for us today, people who have 40 years of tenure. I would say a vast majority of the folks that work here have over a decade of tenure. I started in 2013, and I still think of myself as one of the newer employees. When people get a job here, they tend to stay. We have about 105 people in our current workforce. We are equally divided between the three states where we operate, New Hampshire, Vermont, and Massachusetts. We are about 50% union, 50% non-union. Our union members are IBEW, and our union members are mostly our operations and maintenance staff. These are highly skilled labor positions. You are dealing with folks that are operating in our operations and control center, the people that actually turn units on and off, and open gates, close gates, and control the water. We have electricians, technicians, mechanics, all of them very highly trained, very highly skilled, all members of the union. Our non-union staff, about half of our staff, fill a variety of technical and professional roles. We have engineers, mechanical engineers, civil engineers, and electrical engineers. We have environmental and safety professionals. We deal with large mechanical equipment and on rivers, so there are lots of things to do. We have finance and accounting professionals, and information technology professionals. Cybersecurity is a big thing that we in the power industry need to keep our eye on. Obviously, legal and business management and development type folks. A wide, wide range of professionals that work for the company.

Galen Nelson
That is really helpful. You are probably aware of our internship program. Folks are always looking for, young people are always looking for opportunities in a variety of roles in a variety of sectors across the industry. I would not be surprised if there is interest in working for a significant hydro asset owner.

Galen Nelson
I do want to talk a little bit about innovation. This is somewhat of a shameless plug for the Mass Clean Energy Center\'s Commonwealth Hydro program, which is a relatively small program, but it is one of our oldest programs. We have made over \$7 million in awards over 16 years. Again, one of our longest-standing programs to existing hydropower asset owners in Massachusetts. Those awards have been made to facility owners, and I believe Great River has been awarded once or twice under the program to maintain or increase the capacity of existing hydro facilities. To be clear, the program is not about providing awards to create or develop new hydro facilities. These are for existing hydro facilities that are operating under FERC licenses. I am wondering if you could speak to this, Brandon, not necessarily to the grants that we have provided to you, but beyond regular annual maintenance, what type of investments is the company making in your facilities to improve efficiency or production?

Brandon Kibbe
Of course, I have to say thank you for the grants that MassCEC has provided us. The grant program is extremely helpful to hydro operators from the big guys, like Great River Hydro, down to the smallest of participants. We are members of the Bay State Hydropower Association, and I work on a regular basis with my friends who would consider themselves the mom-and-pop shop of the hydro industry. It is a terrific program that you all operate. We talked a little bit about some of this, but in terms of investment, there is a misconception that hydro has been there, sort of bought and paid for, fully depreciated, and it is there, it does not need any more investment. Consider these are massive infrastructure on the largest rivers in New England, out there and exposed to those wonderful seasons that we all know and love and also contending firsthand with the climatic changes that we are experiencing in New England. You require not just major capital investment to maintain this large facility, but also to be resilient to the changes that we are enduring. That is number one.

Brandon Kibbe
Number two, as we described earlier, these are antiques. Most of the major capital equipment that is located in these facilities have life expectancies of 20 to 40 years. As I mentioned earlier, many of our facilities are over a century old. The only way they get to that point is by continual reinvestment and life extension projects, and oftentimes complete replacement of existing systems. If you stand on the outside of our facilities and look at them, they look much like they did when they were developed a century ago. You go inside of these facilities, and to the untrained eye; it may look that way as well. But I can guarantee, if you crack open some of these things and take a look inside, you will see there is a lot of new steel, there is a lot of new copper, there is a lot of new concrete, there is a lot of everything that goes into keeping these things functioning for as long as they have.

Brandon Kibbe
Last of all, hydropower is federally licensed by the Federal Energy Regulatory Commission. These licenses last 30 to 50 years. I am jokingly saying it, but it is serious when I say that we are currently relicensing our Wilder, Bellows Falls, and Vernon stations on the Connecticut River. We are in the 13th year of a licensing process for existing facilities, a 13-year process that was supposed to take five and a half years. We have spent like \$14 million on studies to support that licensing. That licensing is going to require a whole bunch of new investment to adapt to the new operational constraints, the new environmental requirements that we will get for this new license. Every 30 to 50 years, we need to go through that process and make these additional investments just to make sure that these existing facilities are allowed to continue to operate.

Galen Nelson
Thanks, Brandon. That is helpful, and I think it is a very good pivot to the federal environment. We will get into the environmental impacts in a bit, but particularly just, and I think this is important for every conversation, as much as it can be sometimes a difficult conversation that I have on this show, the impact of the Trump administration. What are you seeing? Is the industry impacted, whether it is via cuts or regulatory changes? I would just love to hear your take on how your facilities are being impacted, both from a financial perspective and or a regulatory perspective by the new administration in Washington.

Brandon Kibbe
I appreciate that. Regardless of the industry, businesses like predictability. It likes to know what is coming. You cannot always see around corners, but you do not like getting the goalposts changed on you mid-game. That said, hydropower has long benefited from being supported on a bipartisan basis. Maybe that is because these things have been here for a very long time and were developed during an industrial time when the culture of our country was very much the betterment of man and the development of natural resources for the better. You think of it as just how we were culturally when these things were built, and they are just part of the landscape now, and have been for a very long time. Maybe that explains why it is bipartisan. Maybe it is because these things are located in red states and blue states alike.

Galen Nelson
They are everywhere.

Brandon Kibbe
They are everywhere. We have been impacted to a degree. It is still a little questionable about some of the hydropower grants that have traditionally been available, and some of them that have been most recently authorized under the Inflation Reduction Act and the bipartisan infrastructure bill that passed a couple years ago. We are not entirely sure what is happening with some of those grant programs. However, the recent budget reconciliation bill, some of the incentives that hydropower was able to take advantage of through the Inflation Reduction Act survived that process, and we still have access to those incentives, the tax incentives in particular, around production tax credits and investment tax credits. Hydropower\'s bipartisan support actually helped win the day for our industry through that process.

Brandon Kibbe
There is also a really important ruling that happened, technically under the Biden administration, at the very tail end, with some IRS rules that came through that actually allows hydropower to finally take advantage of and have the same access to what they call the 80-20 rule for reinvestment in individual units of energy. The way it used to be is, for a wind facility, for instance, if you repowered a single turbine in a wind farm, that single turbine. If you repowered 80% of its fair market value as new, you are able to claim that as that one unit as entirely new. Whereas hydropower, up until this recent IRS change, you had to do 80% of the total investment of the plant, including the dam and the station and all the other.

Galen Nelson
The system, if you will.

Brandon Kibbe
It was impossible to access that previously. This new rule allows us to have a single unit of energy. If you think of our Vernon station, we have 10 units in our Vernon station. Most of our stations have multiple units. Now, if we repower a single unit, that single unit can be considered new if we repower 80% of its fair market value under this new rule. That rule has survived.

Galen Nelson
Understood.

Brandon Kibbe
What you are seeing across the hydro industry is a massive, it has really been a game changer. Repowering and life extension has been really difficult in a deregulated environment. This incentive really has been meaningful, and it is really changing the game and allowing us to make the investments that are necessary so that we have these resources for another century.

Galen Nelson
That is very helpful. What about with regard to tariffs? You mentioned some brands earlier, certainly some recognizable powerhouses, literally and figuratively, Westinghouse and others. We talked about this briefly when I visited your facility out in, I believe it was in Monroe. I am interested in the domestic supply chain for some of the cooler pieces of equipment. I also know that sometimes you need to source from Europe and elsewhere, I suspect. Perhaps there simply has not been enough activity yet, given the relatively short passage of time since the tariff regime has been in place, but is that impacting projects as well?

Brandon Kibbe
Our experience post-COVID was a step change. It has been a consistent step change of probably about 20% across the board for materials and labor in all of our capital spending. We use a lot of copper, a lot of steel, a lot of concrete, but also a lot of labor. The cost of all of those things, before tariffs even came to be. There was a step change in that cost structure starting right after COVID.

Galen Nelson
That is certainly what you hear in the general construction industry. In fact, I think the figure is higher, around 30% since COVID, for both materials and labor.

Brandon Kibbe
The tariffs are certainly going to have the same impact, and we are expecting it to have the same impact. In an industry for us, our industry is saddled with a lot of fixed costs and capital expenses, and in a wholesale electricity market where we exist, we are a price taker. In wholesale electricity markets in New England, the price is set by gas generators and natural gas generators. It is a vast majority of the generation in New England. The price of gas is the driver of the price of electricity. As a wholesale electric generator, we think of ourselves as a big deal in the hydro industry, but we are a small fish as a generator. We are just a price taker. If you look at the long-term trend in energy markets, wholesale electricity markets in New England, the energy price has declined over time. If you look at the long-term trend in capacity prices in the normal market, the long-term price has declined over time. The whole idea of deregulation in the late 1990s was to drive efficiency for the consumer, and the market has done that exceptionally well, but that means our revenue streams have shrunk over time, but our fixed costs have not. In fact, as we were just discussing, the cost increase...

Galen Nelson
In the opposite direction.

Brandon Kibbe
It is a unique challenge, and one that we contend with on a daily basis.

Galen Nelson
Maybe we will hit innovation from one more angle, then we will pivot to some other topics. With regard to innovation, we do see, not many, but a handful of applicants to our competitive technology to market funding programs. These are programs that we manage here at MassCEC that provide grants on a competitive basis to climate tech and clean energy innovators. We do see a handful focused on hydropower, usually around new turbine designs. What do you see, Brandon, as the most promising areas for innovation in the hydro industry, and what are your greatest pain points? It sounds like technologies that could reduce costs would be helpful. I would love to hear your perspective on what you all look for as you think about innovation.

Brandon Kibbe
We have been deregulated now for 25 plus years, operating in a competitive marketplace. We have been squeezing efficiency out of these facilities for a very long time. That goes a wide-ranging set of activities that have been engaged in, from automation to operational models and other things so that we can optimize our dispatch. All kinds of interesting things that we have done. As we talked a little bit about some of the costs that are associated with relicensing, for instance, a major driver in cost in relicensing has to do with environmental performance, particularly around fish safety and fish passage. When you think of the large fish ladders that get built around hydropower plants, a lot of those were installed on the Connecticut River around some of our facilities in the 1980s and 1990s for the passage of Atlantic salmon. They were trying to reintroduce Atlantic salmon into the Connecticut River. The Atlantic Salmon Restoration Program ended up being a failure, and the federal government abandoned the program. The fisheries biologists now are very interested in other species of fish, American eels, shad, other types of migratory fish that move from the ocean to the rivers to breed one way or the other. That means the facilities that we built for salmon do not necessarily work for those other species. The investments that we made several decades ago either need to be completely modified, or completely redone, or somehow changed.

Brandon Kibbe
Fish safety and fish passage, constructing massive infrastructure like that; there is no revenue that is associated with that. If you invest in a new turbine that has better efficiency or capacity, there is a return on that investment because there is revenue associated. These environmental requirements are just an expense. It is an expense that allows you to continue to operate, but it is a massive capital expenditure that you have to outlay. Usually, that type of thing also has an operational and maintenance impact as well. If you are passing additional water through a fishway, that is water that is not powering a turbine, so it is actually lost revenue operationally. If you have to increase what they call a rack spacing or decrease rack spacing to exclude fish from entering a turbine, that means there is less space for things to flow through, and they get clogged up a lot easier. You have to maintain that you have to rake those racks to keep ice or leaves or other debris from buggering up the racks and keeping the water from flowing through the penstocks. There is an operational expense to that as well. These are massive amounts of investments.

Brandon Kibbe
If you can retrofit a turbine in a way that is safe for fish to just pass through the turbine and come out the other side unharmed, that is mostly for downstream passage. That could be a game changer. There are a number of different technologies that are being explored around that. They look promising, and they look like they are getting most of the operational efficiency. You might actually lose a little bit of operational efficiency with the deployment of this new turbine, but you gain the fish safety piece that allows you to avoid potentially other investments that are just cost drivers.

Galen Nelson
That is fascinating. I did not anticipate that you would talk about entrainment and fish passage as a potential area for innovation and progress and cost reduction. That is very interesting.

Brandon Kibbe
It is. The problem, of course, with that is the way the system is set up today, and the way the permitting is set up today, it is a prove-it scenario. You could install it, spend all the money that is required to install and upgrade your system, and then you have to study it to ensure that it performs the fish passage that it said it would perform, and prove it to the agencies before it is accepted as fish passage. The worst-case scenario, of course, is you make all those investments; it proves to be not as effective as the agency wants it to be, and you still have to do other mitigation measures.

Galen Nelson
It sounds like we need a hydropower fish passage innovation demonstration facility in the state of Massachusetts.

Brandon Kibbe
That would be amazing.

Galen Nelson
We will file that one away. That is interesting. Reacting to something that you said earlier, so eels do not like ladders?

Brandon Kibbe
The biology of various organisms differs. An eel tends to migrate on the bottom of the river, whereas shads are surface migrators. How they enter a ladder is very different. The other thing to remember is, there are still lots of eels in the Connecticut River more than 100 years after some of these dams were built. How is that the case? Biologically, eels, on a rainy night, will migrate around a falls, a natural falls or a dam, over land. They have that ability to do that. The fisheries biologists want to see increased fish passage, and certainly fish passage benefits more than just the target species. There are other fish in the river. It allows for genetic mobility up and downstream. There are good environmental reasons why these things exist. If there are more cost-effective and creative ways that we can achieve the same end through technological advances, that would be really remarkable.

Galen Nelson
That is very helpful, Brandon. We were going to touch on the environmental and ecosystem impacts, and I am kind of glad that we approached it from this angle. Maybe we can touch on it a bit more, but I think it is important to note for everyone that there is no perfect energy source, even within the clean energy and renewable energy realm. Every energy source has impacts, and it is about what we all do collectively to mitigate those impacts. I think you can see the real efforts that hydro facility owners have taken to do that here and around the country. But again, there is always room for improvement, and I think it is fascinating that you have focused on this as an opportunity for innovation.

Galen Nelson
Unless there is anything else you want to say about that, maybe we could pivot to the impacts of climate change. I am also just noting the time, and I want to make sure we get to a few questions. I do have a couple more topics I want to hit on. It is hard to ignore this topic. One of the biggest impacts we are seeing, perhaps only second only to extreme heat events here in the Northeast, is dramatic changes in precipitation patterns. When you think about that, extended periods of drought, I feel like we are in one right now, but punctuated by these fairly extreme rain events, that has got to impact rivers and hydropower. I am wondering if you could just talk about how you all are managing this new climate and the change in rainfall.

Brandon Kibbe
First of all, I hate to keep going back to the fact that our system is maybe a little unique compared to other hydro in the region, but with the reservoir storage that we have, that provides us some degree of resiliency that other systems maybe do not have the benefit of. When you think about large rain events, we have these large reservoirs that are sequentially located systems. If we know an event is coming, if you think of Tropical Storm Irene from 2011 when that came through, but other storms like that, where we know it is coming and it is going to deliver a charge of rain, we are able to draw our reservoirs down in advance of that rain arriving so that we can actually shut off the spigot and capture the rain when it comes, and control what is happening downstream. It is a nice nature of having the dispatchability and reservoir storage that we have; we can mitigate the flood impacts that happened during those events.

Brandon Kibbe
In 2023 and 2024, both happened on July 10th for some reason. There were massive rain events that happened in northern New England in the area of the Connecticut River. There were stories of how Montpelier was basically taken out by floodwaters from the Winooski River. A number of communities adjoining the Connecticut River Valley that suffered on tributaries suffered tremendous amounts of damage from those really intense rains that happened in a 24-to-48-hour period. The main stem of the Connecticut River really did not see a whole lot of flooding because of that. Nobody mentioned the fact that it was because we were capturing the rain and managing the water flows as they go downstream, but the main stem of the Connecticut River largely avoided because of our ability to operate. During those types of events, yes, we are a hydropower company, but we are all about dam safety, public safety, the preservation of life and property. We stand up an emergency operations control center internally, and it is all about managing water. We are no longer worried about making megawatts, we are worried about managing water. I would say we do it better than just about anybody. We have an amazing team that does this. The reservoirs really help.

Brandon Kibbe
In a drought like we are currently dealing with, particularly in northern New England, it is the worst drought that is on record in Vermont and New Hampshire right now. If you go to some of the tributaries to the Connecticut River, if you go to the White River, the White River near White River Junction in central Vermont is one of the largest undammed rivers in New England. You can walk across it with barely getting your ankles wet right now. If the Connecticut River did not have large reservoirs that we have been drawing upon throughout this drought, it would look very much the same. However, if you go there today, it looks very much as it does any other time of year. Our Moore reservoir, our largest reservoir in the system, is drawn way down, but that reservoir storage has helped augment the flows in the river over the course of the year. Your average recreational user on the Lower Connecticut River would not know there was much less water than normal, because it has been augmented by that reservoir storage. That system, our type of hydropower, provides some resiliency to the system.

Brandon Kibbe
What is different, and what is sort of the challenge we face, is the control structures on our dams are designed for 100 years ago, before there were certain environmental constraints and other things. We have flashboards on some dams that, when you trip the flashboards to allow large flows of water to go through, you have to wait for the flows to get down to the crest of the dam before you rebuild those flashboards. That might expose upstream areas, like certain types of habitat areas, or during certain times of the year, maybe there are fish that have laid eggs in the shallows. If you have to draw the water down in order to rebuild the flashboards, you run the risk of exposing those to the sun and drying them and having some impact. Ideally, we would be able to modify some of those systems in order to have more active control rather than the passive control of flashboards. Installation of more gates and more ability to control the flow of water through those facilities would give us additional resiliency.

Galen Nelson
That is really helpful, Brandon. I suspect that a lot of people did not have these insights into the extent to which hydro facilities play such an active role. On the one hand, sometimes they are criticized for their impact on rivers, but what I am also hearing is from you, the very active management, particularly in an increasingly chaotic hydrological environment. That is helpful to understand.

Brandon Kibbe
During those events, we work very closely with the weather service run at the Northeast River Forecast Center. We coordinate very closely with them to make sure that they get their forecasts accurate, and that helps public safety officials and all those types of people that rely on that flood information to have the best information they can. We coordinate very closely with the Army Corps of Engineers and state engineers that operate flood control structures that are tributaries to our systems. We also coordinate closely with other hydro operators in the system during events like that to ensure that everybody has the data they need to manage the water they are receiving or are dealing with. It is highly coordinated across not just companies, but also agencies, to ensure public safety in those situations. You are right, that is entirely behind the scenes, and the average person in the public has no idea about it. You go to parts of the Connecticut River where people have docks and pontoon boats. You would never be able to have that, especially this time of year, right now, in the drought that we are in. Those docks would be sitting on mudflats if these dams and reservoirs were not there, but those people are able to go out and still enjoy the recreation on the river.

Galen Nelson
I have seen the Connecticut, the Deerfield, and the White Rivers, actually, all in the last couple weeks, just because of personal travel. It is exactly as you report. I could not believe the White River. I have never seen it so low. I have never seen the Pemigewasset so low. It is just shocking how little water is flowing right now in those rivers, but the Connecticut looks quite good.

Brandon Kibbe
Like it always does.

Galen Nelson
If we could touch on it briefly, because I know we are a little short on time now, but there is one fun aspect to this. I remember having a conversation with the owner of Zoar Outdoors, the rafting company in Charlemont, about how we coordinate with hydro facility owners on water releases. There are also recreational uses. You have got rafting. Is there some coordination with those recreational users that you are essentially creating or enhancing whitewater conditions from time to time?

Brandon Kibbe
100%. When you think about it, we are licensed by the Federal Energy Regulatory Commission. We are using a public resource, a river. These are the waters of the United States. These are yours and mine. We are using it for private enterprise. We have a number of different public benefits that we provide. We like to think millions of megawatt hours of renewable energy is a pretty important public benefit. But as part of that, we provide recreation to the waters and the areas that we control. We have dozens of boat ramps, picnic areas, and trails. On our Harriman Reservoir, we work with a local sailing club, and they operate a mooring field on Harriman Reservoir for sailboats. We have recreational use agreements with snowmobile organizations and the Catamount Trail Association. In Massachusetts, we are the largest private host of the Mahican-Mohawk Trail across our properties. It is a substantial network of public recreation that we provide. On the Deerfield River, certainly the white water releases are one of those recreational opportunities. We closely coordinate with a whole host of Zoar Outdoor, among other private operators, as well as folks like American Whitewater and paddler groups, paddler associations for individual kayakers. We coordinate with them and with other hydro owners on the Deerfield River to provide whitewater releases. If you have ever gone rafting on the Deerfield River in western Mass., that was either below one of our dams or below the Brookfield facilities at Fife Brook.

Galen Nelson
That is really helpful. I think that is a fun and interesting aspect of hydropower. I am just pivoting here. I know we only have a few minutes left but pivoting to some of the questions. One, I think, will be fairly easy to answer. You already essentially have energy storage built into your facilities in the form of these reservoirs. Would there be any reason why you might consider pairing battery energy storage with any of your facilities?

Brandon Kibbe
We are doing more than just considering it. We are actually actively pursuing some projects at some of our facilities. We talked about the capacity factor of our facilities. It is also important to remember that the entire transmission system in western and northern New England was originally built to service our facilities specifically. New England Power built this as a pre-regulated utility and built the transmission lines to connect these facilities, and it became the basis and the backbone of the grid that exists now in northern New England.

Galen Nelson
I was not aware of that.

Brandon Kibbe
We have access to interconnection, maybe unlike many other entities. It is literally in our dooryard, and we have existing points of interconnection that we can leverage. Another thing to remember, too.

Galen Nelson
With substantial capacity in many instances.

Brandon Kibbe
With substantial capacity. Because we have a low-capacity factor, we have existing step-up transformers, existing points of interconnection that we can potentially pair. It matches better with solar than it matches with battery storage, because you dispatch hydro in much the same way you would dispatch battery energy storage. You are looking to dispatch it in the peak times on the grid. In some ways, those two resources would be competing for the same amount of capacity on an existing point of interconnection. Whereas if you are utilizing an existing point of interconnection to marry some solar development, create a solar and hydro hybrid system, where the hydro is the peaker and the solar is filling the middle part of the day, that is really interesting and really able to leverage those existing points of interconnection in the existing system.

Galen Nelson
That makes a lot of sense. We are certainly seeing interest in energy storage developers looking at either downscaled or retiring fossil fuel facilities for the same reason. You have got the interconnection, the headroom, and the interconnection capacity. It absolutely makes sense. In many of these facilities, you have the available land to drop a system there and take advantage of that.

Galen Nelson
It is the noon hour. We have reached that point. There were a few more questions, but I think we actually addressed a lot of that content and those additional questions earlier. I just want to thank you, Brandon. This has been fascinating. It has been really fun to dig deeper into hydro. I really enjoyed the conversation. I look forward to visiting more of your facilities, and just really appreciate your time.

Brandon Kibbe
It has been a lot of fun, Galen. I really appreciate it. Thank you for your time, and anytime you want to see another facility, just give us a ring. Happy to do it.

Galen Nelson
Great, and thanks to everyone who tuned in today. Look forward to our next conversation, which will be actually on Halloween, October 31st, focused on mass timber. That will be a fun conversation as well. Thanks again all. Take care, Brandon. Good to talk.

Brandon Kibbe
Thank you, bye-bye.

Galen Nelson
Bye-bye.