Water Shortages are Forecast to Continue

• The Southwest and Northwest, two of the fastest growing regions, have low precipitation and growing water concerns
• Population (and consequently, load) growth in these regions, combined with the electric industry's reliance on surface water, presents a distinct risk
• Surface water sources, many of which have been hard-hit in the recent droughts, are unlikely to recover quickly
• Construction of new reservoirs is limited due to a combination of environmental pressures and dwindling sites
• Alternative technologies, such as air- and hybrid-cooled technologies, present significant technical and physical implementation barriers

Energy-Water Conflicts Have Already Started

1. Browns Ferry Nuclear Power Plant, part of the TVA complex on the Tennessee River, often experiences warm river flows, such that the temperature of the water at the plant's cooling intakes often approaches or exceeds the Alabama water quality criterion of 86°F, nearly the plant’s discharge limit of 90°F (Curlee and Sale, 2003; Gibson, 2006).
2. Washoe County, Nevada residents expressed opposition to a proposed coal-fired power plant’s planned water use (Reno Gazette-Journal, 2005).
3.  A proposed coal-fired power plant on Lake Michigan (Wisconsin shore) is strongly opposed by environmental groups because of potential effects of the facility’s cooling water-intake structures on the lake’s aquatic life (Milwaukee Journal Sentinel, 2005).
4. Low water on the Missouri River leads to high pumping energy, blocked screens, lower efficiency, load reduction, or shutdown at power plants (Kruse and Womack, 2004).
5. Georgia Power lost a bid to draw water from the Chattahoochee River for power plant cooling (Hoffman, 2004).
6. A New York Entergy plant was required to install a closed-cycle cooling water system to prevent fish deaths resulting from operation of its once-through cooling water system (Clean Air Task Force, 2004).
7. Hot discharge water from the Brayton Point coal plant on the Massachusetts/Rhode Island border cited by EPA as contributing to an 87 percent reduction in fin fish in Mt. Hope Bay; EPA mandates a 94% reduction water withdrawal, replacing seawater cooling with freshwater cooling towers (Clean Air Task Force, 2004).
8. University of Texas researchers said power plants would have to curtail production if 20th century drought conditions recurred (Clean Air Task Force, 2004).
9. As a result of the 1999 drought, water-dependent industries along the Susquehanna reported difficulty getting sufficient water supplies to meet operational needs (GAO, 2003).
10. The Tennessee governor imposed a moratorium in 2002 on the installation of new merchant power plants because of cooling constraints (Curlee and Sale, 2003).
11. Southern States Energy Board-member states cited water availability as a key factor in the permitting process for new merchant power plants (Feldman and Routhe, 2003).
12. The South Dakota governor called for a summit to discuss drought-induced low flows on the Missouri River and the impacts on irrigation, drinking-water systems, and power plants (U.S. Water News Online, 2003).
13. Arizona rejected permitting for a proposed power plant because of potential impact on a local aquifer (Tucson Citizen, 2002).
14. Idaho opposed to proposed power plants because of impact on aquifer (U.S. Water News Online, 2002).

Both Methods of Generation Cooling Are Vulnerable to Drought

• Thermoelectric generation withdraws about 136 billion gallons of water per day and consumes 3.3 billion gallons per day
• A typical combined cycle plant¹ with a closed loop system and cooling tower will withdraw 1.8 million gallons of water and consume 1.4 million gallons every day – the equivalent of filling and draining more than two Olympic sized swimming pools
• Withdrawal and consumption needs are higher with scrubbers and/or CO2 capture
  • Wet scrubbers being added to existing coal-fired generation for SO2 control will increase withdrawal and consumption by about 5 percent
  • CO2 capture, if widely adopted, could increase withdrawals by 1.7 to 4.1 billion gallons per day
• In addition to generation concerns, coal mining consumes 70– 60 million gallons of water per day

Risks to the Electric Utility – Illustrative Example

Getting in Front of the Issue

The ScottMadden Risk Preparedness Model

Project Approach – Risk Preparedness Assessment

Typical Schedule – Risk Preparedness Assessment

• Project takes four to six weeks, depending on finalized scope
• Begins with interviews with key internal stakeholders (typically 15 to 20 interviews)
• Includes a review of internal strategy, commitments, requirements, plans, reporting, and other internal documentation
• Is conducted by a small project team comprised of senior-level consultants working collaboratively with key client personnel