Lake Mead watch: As levels fall, hydropower dips

Why Southwest utilities are starting to sweat.

 

When the Hoover Dam was built in 1936, it was the largest concrete structure – and the largest hydropower plant — in the world, a massive plug in the Colorado River, as high as a 60-story building. For nearly 80 years, the dam has been producing dependable, cheap electricity for millions of people in the Southwest, but as water levels in Lake Mead continue to drop, the future of “the greatest dam in the world” is more precarious than it ever has been, and utilities across the desert are taking notice.

This month, Lake Mead, the 112-mile reservoir created by the dam, is projected to hit 1,074.73 feet above sea level, the lowest it has been since it was filled in 1937.  Thanks to a 16-year drought and serious over-allocation, Lake Mead is now just 37 percent full. Although a “miracle May” of rain means the water level will rise again, the longer term prognosis is more worrisome: If water levels continue their downward trend, the amount of energy generated by the Hoover Dam will fall, leading to higher electricity costs for 29 million people in the desert Southwest.

That's because a shallower reservoir means less water pressure against the turbines, generating less electricity. A recent report by graduate students at the University of California, Santa Barbara in conjunction with the Western Water Policy Program, examines the economic and physical impacts as Lake Mead’s elevation falls: With each 25-foot drop, total energy costs increase by roughly 100 percent, compared to a full reservoir. The costs paid by contractors for hydropower double at 1,075 feet, triple at 1,050 feet, quadruple at 1,025 feet. At 895 feet, the turbines won’t run, a level they call “dead-pool.”

Drought in the southwest is challenging operations at the Hoover Dam, the nation's largest hydropower plant.
Airwolfhound/Flickr

Dead pool is still a ways off and in the short term, less generation at Hoover won’t translate into soaring electrical bills, says Frank Wolak, an economics professor at Stanford. That’s because utilities buy “futures” contracts for energy, which guarantee a certain price for a period of time. It’s like buying a plane ticket in advance: The price is significantly less than one bought on the same day as a flight. In the case of Hoover, many of those contracts span up to 10 years and were negotiated before low water levels became a significant concern.

Still, Hoover’s power capacity has dropped nearly 25 percent since 2000, and the 53 hydropower facilities run by the U.S. Bureau of Reclamation across the West are producing 10 percent less power than a few years ago, despite rising demand. So when those futures contracts run out and continued low water levels appear likely, bottom-barrel prices for hydropower will likely be a thing of the past.

That means that utilities currently relying on Hoover’s power, such as the Overton Power District No. 5, which serves 15,000 people in Nevada on the southern end of Lake Mead, are wary. Overton buys 20 percent of its power from the Hoover Dam, 5 percent from other hydro projects, and 75 percent on the spot market (where energy is traded on day-by-day basis). The utility anticipates having to replace 5 percent of its hydropower with another, more expensive, energy source, says Mendis Cooper, Overton’s general manager. That switch won’t translate into sky-high energy bills, likely just a 1 to 2 percent increase. But if Lake Mead continues to fall and shortages become routine, his customers could see more dramatic increases in their electricity bills. 

“We’ve been having those discussions,” Cooper says, noting that the major topic is moving to more renewables, like solar, as well as improving efficiency.

Luckily, the West has ambitious renewable goals, says Wolak, which will likely make up more of the region’s energy mix and help mitigate the loss of hydropower in the future.

Still, renewables aren’t a panacea. Wind and solar are far more volatile and require back-up power sources, such as gas-fired power plants. And though the prices for renewables have come down in recent years, they’re still no match for cheap, federally subsidized hydropower. “They solve the resource issue,” Cooper says, “but not the price issue.”

Sarah Tory is an editorial fellow at HCN. 

High Country News Classifieds
  • CONSERVATION FIELD ORGANIZER
    Title: Conservation Field Organizer Reports to: Advocacy and Stewardship Director Location: Southwest Colorado Compensation: $45,000 - $50,000 DOE FLSA: Non-Exempt, salaried, termed 24-month Wyss Fellow...
  • UTAH STATE DIRECTOR
    Who We Are: The Nature Conservancy's mission is to protect the lands and waters upon which all life depends. As a science-based organization, we create...
  • EXECUTIVE DIRECTOR
    Apply by Oct 18. Seeking collaborative, hands-on ED to advance our work building community through fresh produce.
  • INDIGENOUS AFFAIRS EDITOR - HIGH COUNTRY NEWS
    High Country News is hiring an Indigenous Affairs Editor to help guide the magazine's journalism and produce stories that are important to Indigenous communities and...
  • STAFF ATTORNEY
    Staff Attorney The role of the Staff Attorney is to bring litigation on behalf of Western Watersheds Project, and at times our allies, in the...
  • ASSISTANT VICE PRESIDENT FOR DIVERSITY AND INCLUSION
    Northern Michigan University seeks an outstanding leader to serve as its next Assistant Vice President for Diversity and Inclusion. With new NMU President Dr. Brock...
  • EXECUTIVE DIRECTOR
    The Clark Fork Coalition seeks an exceptional leader to serve as its Executive Director. This position provides strategic vision and operational management while leading a...
  • GOOD NEIGHBOR AGREEMENT MANAGER
    Help uphold a groundbreaking legal agreement between a powerful mining corporation and the local communities impacted by the platinum and palladium mine in their backyard....
  • EXECUTIVE DIRECTOR
    The Feather River Land Trust (FRLT) is seeking a strategic and dynamic leader to advance our mission to "conserve the lands and waters of the...
  • COLORADO DIRECTOR
    COLORADO DIRECTOR Western Watersheds Project seeks a Colorado Director to continue and expand WWP's campaign to protect and restore public lands and wildlife in Colorado,...
  • DIGITAL MEDIA SPECIALIST, THE NATURE CONSERVANCY: WYOMING, MONTANA AND UTAH
    Digital Media Specialist - WY, MT, UT OFFICE LOCATION Remote and hybrid options available. Preferred locations are MT, WY or UT, but applicants from anywhere...
  • GRANT WRITER (PART-TIME, FREELANCE CONTRACT) HIGH COUNTRY NEWS
    High Country News seeks an energetic, articulate and highly organized grant writer to support a growing foundations program. This position works closely with our Executive...
  • ASSISTANT PROFESSOR OF HISTORY - INDIGENOUS HISTORIES OF THE NORTH AMERICAN WEST
    Whitman College seeks applicants for a tenure-track position in Indigenous Histories of the North American West, beginning August 2024, at the rank of Assistant Professor....
  • DAVE AND ME
    Dave and Me, by international racontuer and children's books author Rusty Austin, is a funny, profane and intense collection of short stories, essays, and poems...
  • CHIEF FINANCIAL OFFICER
    Rural Community Assistance Corporation is looking to hire a CFO. For more more information visit: https://www.rcac.org/careers/
  • EXECUTIVE DIRECTOR
    The Absaroka Beartooth Wilderness Foundation (ABWF) seeks a new Executive Director. Founded in 2008, the ABWF is a respected nonprofit whose mission is to support...
  • CANYONLANDS FIELD INSTITUTE
    Field seminars for adults in natural and human history of the northern Colorado Plateau, with lodge and base camp options. Small groups, guest experts.
  • COMING TO TUCSON?
    Popular vacation house, everything furnished. Two bedroom, one bath, large enclosed yards. Dog-friendly. Contact Lee at [email protected] or 520-791-9246.
  • ENVIRONMENTAL AND CONSTRUCTION GEOPHYSICS
    We characterize contaminated sites, identify buried drums, tanks, debris and also locate groundwater.
  • LUNATEC HYDRATION SPRAY BOTTLE
    A must for campers and outdoor enthusiasts. Cools, cleans and hydrates with mist, stream and shower patterns. Hundreds of uses.