Catalyst with Shayle Kann - How to build more hydropower

Episode Date: April 20, 2023

Hydropower is the world’s largest source of renewable electricity today, according to the IEA. Like gas peaker plants, it’s highly dispatchable, meaning it can complement intermittent renewables like wind and solar.  And we could get a lot more of it. The IEA estimates that we could double the amount of energy produced globally. One peer-reviewed study found that global economic potential for hydropower was 21,000 terawatt hours per year, more than five times the current generation today.  So how could we deploy more hydropower? In this episode, guest host Lara Pierpoint talks to Gia Schneider, co-founder and CEO of Natel Energy, a hydropower technology company. One key argument Gia makes is that if we can build smaller projects with lower ecosystem impacts, we can tap into more zero-carbon power.  Gia and Lara talk through:  How quickly we need to build more hydropower to meet 2050 net-zero targets The benefits of traditional hydro as a full-stack grid resource Different types of hydro technology like run of river, hydrokinetic, and traditional large-scale dams Why smaller, more distributed systems are key to unlocking hydropower potential Different technologies to manage fish and debris like bypass channels, screens and fish-safe turbines The co-benefits of improving riverine landscapes, including making ecosystems and hydroelectric infrastructure more resilient to climate change How hydrology and forecasting can help us better manage dams in a changing climate Recommended Resources: Energy & Environmental Science: A comprehensive view of global potential for hydro-generated electricity Bloomberg: The World’s Biggest Source of Clean Energy Is Evaporating Fast Catalyst is a co-production of Post Script Media and Canary Media. Support for Catalyst comes from Climate Positive, a podcast by HASI, that features candid conversations with the leaders, innovators, and changemakers who are at the forefront of the transition to a sustainable economy. Listen and subscribe wherever you get your podcasts. Catalyst is supported by Scale Microgrids, the distributed energy company dedicated to transforming the way modern energy infrastructure is designed, constructed, and financed. Distributed generation can be complex. Scale makes it easy. Learn more: scalemicrogrids.com.

from the studios of PostScript Media and Canary Media. I'm Lyra Pierpoint, and this is Catalyst. The way in which we're going to increase capacity is, we firmly believe, a shift that moves away from just building megaprojects and instead looks at building projects that are more distributed in nature, which means smaller. We're still talking projects that are tens and maybe even hundreds of megawatts, so we're not, they're still substantial projects.

They're just not a single 20, gigawatt project in one go. When utilities need flexible capacity they can count on, they turn to Energy Hub. Energy Hub works with more than 170 utilities, coordinating over 2.5 million devices to manage 3.4 gigawatts of flexibility built for the moments when utilities can't afford uncertainty. Energy Hub builds and operates virtual power plants that utilities actually stake their grid planning on, coordinating EVs, batteries, thermostats, and more through a single platform built for utility scale. Predictive, verifiable, and designed to perform when it counts. Learn more at

Energy Hub.com. Trillions of dollars are flowing into clean and critical infrastructure, but those investments aren't driven by technology alone. They're shaped by markets, by policy, by capital, and by the institutions that connect them. I'm Alfred Johnson, CEO of Crux, and host of a brand new podcast, Critical Capital. Each episode, I talk with people deploying capital, shaping policy and building the clean economy. as we unpack how progress is actually made. Listen to critical capital on Spotify, Apple, or wherever you get your podcasts. I'm Laura Pierpoint filling in for Shale Khan while he's out this week. I'm the CEO of Actuate Climate. It's a nonprofit focused on systems innovation to scale greenhouse

gas emissions reductions. The world's first hydroelectric power plant started operation in 1882 on the Fox River in Wisconsin. Before that, of course, humans had been using river power for all sorts of purposes, and even before that, beavers were building dams. Hydropower is not, in other words, a classic example of new technology. It is, however, currently the cornerstone of global carbon-free electricity. It's the third largest source of electricity, period, after coal and gas, and produces 16% of electricity worldwide, more than all other renewable resources combined. And it's on a role, or at least it could be. Peer-reviewed research estimates that globally we could theoretically increase hydro production capacity many times over what it is today, and it's already a large slice of generation.

This is huge, and not just because this represents enormous potential. This is electricity that is carbon-free and dispatchable and available, virtually all of the time. The challenge, of course, is that done wrong, hydropower is very disruptive to river systems. Altering the state of the river has implications for fish and other wildlife. agriculture, and, of course, drinking water. But could we have our hydro power cake and eat it, too? Can we take advantage of the enormous potential of hydro for electricity production and maybe even improve ecosystem conditions and the likelihood of maintaining healthy watersheds for a variety of human purposes? Gia Schneider, co-founder and CEO of Natel Energy, and I discuss these

questions and more. As always, leave us a voicemail at 919808, 511. or email us at Catalyst at Postcript Audio.com. You can also tag us on Twitter. But for now, here's my conversation with Gia. Gia, it is so exciting to be here today to talk to you about hydropower. Really great to be here as well. So obviously, massive potential source of decarbonizing the world's economy. But let's talk about where we are today.

How much hydro is there globally? How much are we really reliant on it now for particularly power production? because that's really where we're talking about a lot of greenhouse gas emissions. Yeah, so today we have about 1.3 terawatts of installed operating hydropower. And that represents about the, it's the majority of renewable energy produced in the world today. It's the third largest source of electricity after natural gas and coal. And in terms of its importance in maintaining reliable grid operations, for example, if you looked last summer in the United States in every power market where you have, have hydro and you pulled up the dispatch curve, the daily dispatch curve of assets in a particular

ISO, what you'd see is if you have hydro and you have gas, hydro and gas are the two assets basically dispatching in parallel with each other to balance the grid. And that is simply because hydro has such a complete stack of reliability resources. And I think that's one of the reasons why we're really excited about the potential for hydro as we go forward. And we'll definitely get into that. But before we get to that, I realize it might be helpful for folks if we just walk through, like, how does hydropower actually work? I think it may be obvious to a lot of folks, but maybe you can walk through, like, what happens? Like, when you build a dam, you build a reservoir, how do you actually get power out of hydro, ultimately? Yeah, absolutely. So just the basics simply

are that hydropower and the way we produce energy from hydro is a function of two things. So one is kind of intuitively how fast to the water is moving. And that's one element. But actually in hydro, unlike wind, that is the smaller element of the resource potential. The other part is the conversion of the potential energy of water falling a certain distance and converting that to kinetic energy that we can then turn into electricity. And that is the bigger part of actually where we get energy in hydro. And that then translates to the reason why.

dams historically have been built because if you build a dam, it's a way for you to take the slope effectively of a river as it runs downhill. And if you build a dam, you're finding, you're basically capturing that slope change over at one single point in space. And the higher that height conventionally, historically, that has allowed us to kind of concentrate the energy generation in a single point in time. So basically, we take water and we run it through a turbine, and that turbine then spins, and that spins a generator, and then the generator produces electricity. The rest of the power extraction is all very standard stuff. Really, the thing that's different in hydro is we're capturing, we're aggregating the energy of water moving down of landscape and then taking it out at certain points in that landscape. As you're talking, I'm really reminded of the first time I saw the Whoop.

dam outside of Las Vegas on the Colorado River, and that thing is enormous. Like, when you want to talk about scale, you really get a sense looking at how gigantic this thing is, that this is a big deal for power production. And I think the other thing that really struck me looking at that was it was built before computers existed. Like, this is something that we've known how to do and have done for a very, very long time. Yeah, absolutely. And I mean, the history of hydro is interesting, because, for example, if you look at when a lot of the big dams were constructed in the Pacific Northwest, they coincided with completion in the early, like late 30s, early 40s, and that really put us in a position actually entering World War II,

where we had this enormous chunk of electricity capacity that could go immediately into aluminum production, which was like a critical thing in being able to produce aircraft in particular fast enough as the U.S. entered World War II. So, like, there's just all this history around hydro, good and bad. And I think that – but one thing that is kind of incontrovertible is that as a energy source, it has a really full stack of characteristics in terms of being able to provide, you know, black start, which is like start up a grid. It can provide voltage regulation, reg up, reg down.

It can provide spinning reserves because there's a lot of inertia in the machines. And it just has a lot of characteristics that make it like a full stack reliability resource. And the challenge, again, is then how do we do do how do we do do do do we do two things? Like how do we take this really large existing but old installed base that we have globally and modernize it for the future? And then how do we unlock this potential? How do we really get to this 20 gigawatts a year of new build, right, that the IAA says that we need to achieve? Yeah. So let's get into both of those topics.

And I think as we do, let's talk a little bit about kind of the benefits and drawbacks of Hydro, because I think that gets into like why build or why don't build, right? So the benefits, some of them you've already listed, this is kind of a unique kind of resource for the grid and that it can provide pretty much any type of resource the grid needs on a number of different timescales. What else would you put in that category? It's carbon-free nature, I guess, would be one of them. Yeah, absolutely. It's, yeah, so it's carbon-free and very confirmed.

controllable. And then, you know, when you get outside of the energy story for water in particular, most large hydro projects also have a water resource and water management component to them, whether it's water for, you know, water storage, whether it's for agriculture or human consumption. Some cases, it's also for flood control. A lot of the times you basically have these large projects that function as multi-purpose facilities. But from an energy perspective, I think, is the key thing far in a way is it's just a full stack resource. Well, let's dive into that piece a little bit. The fact that there are potential benefits around, for example,

controlling floods and agriculture and things like that. But this is also sort of veers into drawback territory, depending on how you define things, right? Because I think sometimes, at least I've heard it, pose that it can be a zero-sum game between, are you using the water for energy production versus agriculture versus, frankly, for environmental purposes to kind of keep rivers flowing? So how do you see the relationship?

between sort of the benefits and drawbacks that are kind of mired in that stew of characteristics there. Yeah, it's a super complex question. And one, frankly, for which there is not often a one-size-fits-all answer for all projects. It really is important. Actually, most things are context-dependent. And so you do, it is important to understand the geographic characteristics and constraints of where each project is located. That being said, I think that there, we know a a lot more about how to manage water resources and in particular how to leverage natural infrastructure processes to support healthier river function. And that is coming out of something completely unrelated to hydro, just river restoration and conservation work. And one of the things that we're really excited about is to leverage the lessons learned, to take the lessons we've learned from removing dams, from restoring rivers, and integrate that into plant. both for improving existing hydropower as well as building new.

And I think that's just going to be a critical element. At the end of the day, the majority of our rivers globally, unfortunately, are heavily modified and exist in a state of mild to severe disruption and disconnection. And finding ways to restore those rivers and their function is going to be a critical element of adapting to the changing water patterns we see anyway with climate change. And so, again, I think that's where hydro has this really cool ability to, because it's multipurpose and can function in a multi-purpose way, that actually we can incorporate into hydropower projects, things that will also help make river landscapes and river ecosystems

more resilient to climate change. Interesting. Okay, I definitely want to dig into that. I think before we do, though, let's talk a little bit more about what specifically you mean when you say river disruption, right? because I think there are two elements that I know about. One is that when you build the dam, obviously you're creating a pretty big lake. And it's actually a random side story.

I wrote a report when I was in, I want to say fifth or sixth grade, about the temples at Abu symbol that basically were had to be moved because of the Oswan High Dam on the Nile River. And there was an amazing array of technological options and ideas that people threw out all the way from like, you just put like a membrane to protect them from like this. built in the water and then have people like scuba dive to go visit. It's a really wild stuff. So there's the question of what happens with the lake and also potential carbon emissions as trees essentially are taken out by the fact that you have this growing lake. In addition to a piece that I know you know well, which is how fish adapt to a disrupted river. So can you say a bit about kind of what are the ecosystem impacts of a dam and hydropower in particular all the way from like what happens when you do dam construction to the ongoing impacts? Some of the things that we need to think

about as we're, and potentially mitigate as we're building out hydropower. Yeah, absolutely. So, I mean, disruption in rivers from hydro really does come from the fact that we're building an obstruction in, and an obstruction that's very different than the obstructions that existed in rivers naturally. So just as a quick sidebar in the U.S., if you were to rewind the clock several hundred years, what you would have found in the U.S. is a landscape full of rivers full of obstructions, but those obstructions were things like naturally occurring log jams and beaver dams. And they could be quite significant. So in nature, you will find just even natural log jams that can represent really substantial civil

structures that create ponds and, et cetera, and same thing with beaver dams. But again, they function in a way that actually generally is contributing to river health. So for example, those types of pieces of natural infrastructure, so to speak, they will create a more fully connected floodplain for the river. That's really helpful when you have spring storms and floods because it gets the water out over the landscape. That helps drive groundwater recharge. And that, in turn, bolsters more perennial river flow because if you have high groundwater

tables, if you've got a really robust groundwater situation, you will have more consistent river flow year round, which then helps to mitigate droughts and helps mitigate wildfires. And so to bring it back to hydro, a lot of the, to bring it back to hydro, a lot of the things that we're looking at on a more systems basis with our work is where, how can we connect experts and practitioners in river restoration who really deeply understand how some of those natural dams, so to speak, function and incorporate that into the design of hydro for the future. Because the way we've built hydro historically, the dams we've tended to built for hydro are ones that represent this very like hard and monolithic break in the river's flow without often very

straightforward ways or more natural ways for sediment, for fish, for various types of material to move within the river in a natural way. And then that disruption is what creates cascade of other negative impacts. In the Aswan example, for example, there's so much silt moving in the river that, you know, a side effect of that dam is that it rapidly, unfortunately, became a lot less productive as a hydropower asset because it filled up with silt and there wasn't a plan for how to manage it, how to ensure that that silt would keep on moving through the system as it had done for thousands of years before and we'll need to continue to do. So I think that's the, that's a key piece of is where how do we actually take that, learn from

lessons and as we as we improve hydro for the future, ensure that we're incorporating things that maintain more of that river connectivity with respect to sediment, fish, et cetera. That's super helpful. And I really appreciate, by the way, that you helped, like, end the story for me on the Oswan Hydam because I have not done a good job since it's great of checking in with, like, what the scene is over there. But so I'm interested to know some of the, some of the history there. That's great.

Okay. So as we're thinking about then what it's going to take to get to, you know, basically, it sounded like what you said was basically a tenfold increase, at least theoretically, in the capacity of hydro worldwide. Clearly, we're going to need some portion of that to become real to hit our decarbonization goals. So why would that be challenging or why is that challenging? Do you think it really comes down to, in large part, the ecosystem impacts associated with building dams and how different societies and geographies are processing that? Or are there other like sort of headwinds or other reasons that it's challenging in some cases to get more hydro? It's a mixture of things. And so I think one,

one element is that the hydro, if you look at the arc of history of hydro, so going back maybe 100 or so years when some of the first hydropower projects that still are operating today were built, those projects tended to be fairly small. So we're talking, you know, a couple megawatts, five megawatts, 10 megawatts. Then the plants, you know, fairly quickly became big. So by the time we got to the 30s, 40s, 50s, we really started to see projects that were hundreds of megawatts. And then fairly soon thereafter, we started to see projects that were, you know, multiple gigawatts in size. And then finally in the 70s and 80s, we started to see projects where, you know, we had literally some projects built where we, where a single project was 15 gigawatts or 20 gigawatts in a single project. So really massive mega projects. And what's happened is that the massive mega projects carry with them just an enormous set of challenge. They're just so enormous. They've become very hard to estimate costs correctly. They take a very long. time. We're talking 10 to 15 years to build. And that time compounds the cost estimation challenge

because a lot of things can happen in 10 years. As we've seen in the last week, a lot of things can happen even in just a few days that have massive impacts on all sorts of things. And so the way in which we're going to increase capacity is, we firmly believe, a shift that moves away from just building megaprojects and instead looks at building projects that are more distributed in nature, and which means smaller by moving to smaller projects. And we're still talking projects that are tens and maybe even hundreds of megawatts. So we're not, they're still substantial projects.

They're just not a single 20 gigawatt project in one go. And but moving to more distributed projects allows a much tighter control over all of the things that end up driving cost on the project. And I think that's one important piece. We just have to find ways to better. cost estimate, get projects done in a shorter and more timely fashion, and keep, you know, budgets under control. That's one.

And then the environmental piece is absolutely critical and is in some places a direct, you know, regulatory thing. So you can or cannot build, depending on how you perform from an environmental perspective. But there are plenty places in the world where you don't have necessarily hard and fast rules around certain environmental requirements. And there, I think the reason why we're also very focused on safe fish passage and environmental performance is because bottom line, if we can deliver the same power performance at a similar or lower cost while being safe for fish, while maintaining river connectivity

or in some cases restoring river connectivity, then why not? even if there is no rule requiring that, at a minimum, just from a financial perspective, you are, or a risk management perspective, you're future proofing against coming regulations. And at the end of the day, you know, just from a sustainability perspective, we need to move our management of water resources in a more sustainable direction. And so that's why we think this, the path forward for hydro is one really where we are, we use both combination of smarter and more sustainable design of projects, including things like what we're working on with fish safe turbines, but more broadly, I think it's just a, it's incorporating, again,

a lot of these lessons learned of how we can design projects that fit into a river ecosystem more sustainably. So that's one really important component. And then the second layer is really defining projects that, again, can fit into a, you know, a size that is better suited for management of both time and budget to completion. Interesting. Okay, so basically I'm sort of hearing three categories here that ideally to really take advantage of kind of this potential that exists out there for hydro. It's about reducing cost. It's about reducing the environmental impacts, at least the negative environmental impacts. And it's about, I don't know how I was to say this, like picking the right

project and the right spot in the river and sort of making sure that you're doing. that things are sized appropriately, which is probably related to the other two. Yeah, and that can be absolutely. And the sizing question, the last point there is that for, for, there was a, there was a big progression in hydro development that was kind of built into the mantra that bigger was always better, right? And at the end of the day, to get bigger, the simple math way to think about or the simple kind of way to diagram it is that water runs down a landscape and you can put your

hydro project at any point in that path of the river. And if you put it at the bottom of the hill and build a massive dam, you only have one project. You're capturing the entire slope to the bottom of that hill in one massive mega project. You could approach that by building five projects, you know, at different intervals down that slope. And where the pendulum has swung with materials costs, labor costs, et cetera, in general is that moving to projects that are a little bit more distributed, a little bit more bite size, is beneficial in many cases for managing the other aspects, cost and environmental impact. I love this.

It's fitting with sort of a general theme for the current era of clean tech, which is, I would say, like, bigger is not necessarily always better, which I kind of love. Not in all cases, but certainly in some cases for some of the techs out there. But let's get into this. Let's get into some technology and to some ways because, you know, what you described sounds a little bit like magic, right? How do you reduce costs, get more distributed, and protect the fish in the ecosystems all in one go? So talk about some of the advances in hydropower technology.

Maybe we can actually start by talking about run-of-river hydro, because this is something that certainly sounds good in practice, right? That you're just using the kinetic energy of the water, so less about the potential energy of the gravity, right? But potentially getting some power out of a river without necessarily building a dam at all. Is that how to think about this? and how viable is runover-river hydro? Yeah, so there's two things actually that often get put into runover river. One is hydrokinetic. And hydrokinetic is where, as you were describing, there is no dam.

It's like taking a windmill, and instead of having a windmill turn in the air, I have that windmill turn in the water. It looks different than a windmill, but yes. And so for hydrokinetic, there are a number of interesting opportunities. The challenge for hydrokinetic is simply put. but that in rivers, there are, there's all sorts of debris that moves in rivers in a way that's very different than wind. And so anything that goes in a river or in a tidal current has to have, be protected from

large things that move in water, logs, etc. And that protection of the power generation equipment is then adds a whole layer of additional cost and civil works and complexity because you need to also then keep your keep it clean. You need to find a way to clean debris off of the thing that's protecting it. And so at the end of the day, the challenge in hydrothonetic is simply water can move through your turbine or around your turbine. You have to still protect your turbine. And so what we've generally seen is that hydrokinetic makes sense in very certain specific applications,

but it's been hard to get costs to the point where it's as broadly applicable as we'd love it to be. And so the other runover way in red river is used describes what is more conventional hydro, but where in the sense that there is a conversion of potential energy to kinetic energy, we have a drop or dam of some sort. But what we don't have is a massive reservoir that is storing water for months at a time, right? Because once you get to reservoirs that are storing water for many months at a time, that is another way in which hydro disrupts a river's flow. And so run of river is generally, applies actually to a lot of existing hydro today, where the dams, if you will, are more like a beaver pond.

I mean, drawing the analogy a little bit roughly, but we have plenty of examples where we have ponds, and those ponds kind of ebb and flow, depending on what's happening with the river flow, but in the context of a beaver, those are not, those do not necessarily have to result in, again, an impact on the river that is 100% negative. Now, one of the conundrums is that, or one of the interesting things that, again, as we've dug into this more, is that there, it does, it seems very clear as you dig into the science around the fact that there are small dams that have major negative impacts. It's not a size thing. You could have big dams, you could have small dams, it really comes down to the ways in which water moves around and, you know,

through that structure. So if you have good bypass channels, like good areas where fish can move upstream and downstream, if you have good ways in which sediment can continue to move through the river system and you're not just locking sediment up, if you have ways in which debris, again, is managed because one of the things that rivers do is they distribute sediment and logs and, you know, vegetative matter throughout a landscape. And that is important because it helps distribute nutrients across the landscape. And so it's just a – once you start to get into it, rivers are kind of like they're like arteries, right? So they transport fluid for many things through the earth.

And so thus it gets quite – it becomes quite a systems problem when you start to think about, like, what's the right way to design them to maintain that function? Yeah. But on the point of river, sorry, it's just – The key characteristic there is just that we don't have a massive reservoir where we're storing many months of water. Virtual power plants are becoming a reliable way for utilities to manage capacity, but enrolling devices is just the start.

What really matters is confidence, knowing those resources will perform when dispatched and being able to prove it from the control room to the living room. Energy Hub's platform handles the full picture, from near-real-time forecasting, locational dispatch, and the kind of rigorous verification that holds up when regulators, grid operators, or leadership ask, did it deliver? Easy enrollment creates momentum, proven performance builds trust.

That's why more than 170 utilities rely on Energy Hub to manage over 2.5 million devices delivering 3.4 gigawatts of flexible capacity. See what that looks like at energyhub.com. We're living through a profound economic shift, and energy sits at the center of all of it. Trillions of dollars are flowing into power plants, transmission lines, battery factories, data centers, but the future of energy isn't shaped by technology alone. It's shaped by markets, by policy, by capital, and by the institutions that connect them. I'm Alfred Johnson, CEO of Crux, the capital platform for the clean economy. Join me for my brand new show, Critical Capital, as I talk with people deploying capital,

shaping policy and building projects. Together, we unpack how risk is priced, how incentives are structured, and how progress is actually made. Listen to critical capital on Spotify, Apple, or wherever you get your podcasts. So let's talk about then about DMs and about this piece. Like, what can we do from a technical perspective or from a system's perspective to make sure that we're designing them to the degree possible to be supportive and not detrimental to the ecosystems? So what is the answer there? are there cool new technologies that help us do that? Is it really about planning? Is it about technologies that help with planning and design? What are the things that are on the table to help

us do a better job of making dams that help and don't hurt? Yeah, great question. And the answer is there are a number of things. And some of it is tech and some of it is more what I think of as as having a different approach when it comes to civil and environmental engineering. And again, dams are kind of this monument, is your reaction to Hoover Dam that you mentioned, right? It's a monument to human engineering and the ability to build massive things, but they're very much not natural.

And so an area that I've already alluded to that I think, again, it's very exciting, is fighting that tendency that we have to build massive artifacts that are not natural, but very human. And instead say, okay, we can look at a lot of things that we understand now today much more deeply about how reverse function, looking at beaver dams, looking again at natural log jams, looking at all of this stuff that we now have a deeper understanding of the hydrology of how healthy reverse function, and design those things into the civil structures that we're using for hydropower. We have talked about things like ensuring that there's a good amount of leakage through a dam, which is, you know,

and again, it has to be done carefully because you say that to, from a civil engineering and dam safety perspective, and it can sound quite alarming. It's important that you'd have to approach it in the right way. But at the end of the day, finding ways to that water, what we mean by that is that there's connectivity, water can move through the system, and that the pathways that that water finds to move through the system are ones that also support off main channel transport of fish. Because if you go and look at a beaver dam, where fish are typically moving upstream and downstream through that, Beaver Dam is not jumping over the dam itself. Though certainly salmon, for example, can do that.

But you have multiple side channels where the water velocity is slower. It's easier for particularly young fish to navigate, things like that. So that's one element that's more like systems-y environmental engineering type stuff. Another element that I think is really exciting for the future is better tools to understand what's happening with water flow. and there's some really exciting things out there in hydrology and forecasting that I think have a ton of potential to help us better manage the water resource so that as we are both taking existing structures and upgrading them for the future. For example, we know we're going to face more extreme swings between lots of precipitation and then not enough precipitation. That has a whole host of implications for how to better invest in the existing infrastructure. to manage through that. If, for example, I expect my probable maximum flood to double as a result

of climate change, but at the same time, I might see a situation where I could also see my drought chance double, then what's the right answer? Do I need to throw a lot more concrete onto my structure? Because my PMF is, my probable maximum flood is doubled. I now need to make sure that that civil structure is going to stay there and not float away in a flood, so I've got to put more concrete on it. That would be a very traditional approach. Or do I use better forecast methodology to give me a heads up so that I can start releasing way in advance? And I don't have to, I can do more of a digital info approach to manage the system. And that applies to broadly across hydro and water infrastructure as well. Can I pause you on that one for a second? I know there's

some other things too that we're going to want to manage, but let's just get into this question about the climate impacts because I think listening to you talk, one of the things that sounds like it could be concerning as exactly as you said, that now water patterns are getting more extreme, right? And so you might have this twin problem that you want to shore up your dam with more concrete, but also that you may not get as much revenue out of it as you were expecting because of drought years. So is this, I mean, is this something that's really manageable through modeling, or do you think, like, are there going to start to be cases where dams don't make as much sense anymore because of the swings in uncertainty, meaning there are just, there's probabilistically

too many cases where you can't make money with a dam. Oh, yes. I mean, there absolutely will be cases like that where it doesn't make sense anymore. There are places, unfortunately, geographically, where there's a clear drying and a ratification trend that over some time period will mean that, you know, an existing hydro facility will probably need to be downsized or entirely reimagined. There are other places where we're seeing a definite increase in precipitation. And in those places, like hydro is an increasingly attractive resource.

So the blunt reality of climate changes, we're going to see both happen. And it definitely has implications for where you want to invest and what you want to invest in from a resource perspective. And I think some of the tools I was mentioning have a really important role in helping inform that decision-making for folks who are deploying infrastructure capital. Then is it – I mean, I think the other. other piece that's true, and we're seeing this already in the Western U.S., for example, last year, you know, the West has been in drought for a number of years, hopefully not coming out of this year. But last year, I think one thing that was kind of probably a surprising statistic if you dug into it further is actually that hydro, despite the West being in an overall drought,

it was a pretty great year for hydropower. And it was because the conditions for hydro in the Pacific Northwest were solid, and those assets were played a critical role, frankly, in balancing the grid. And because of the interconnection, the intertie between Northwest and California, that power could cycle every day to help balance out California and the duck curb. So bottom line is, as is going to be the case, frankly, in making a fully renewable grid work, is that resource diversity and interconnection is the name of the game because we know every day that the sun will shine for some hours

and not shine for others. We also know that the wind will blow and not blow on maybe not quite as predictable path and then hydro has its own resource cycle and we're going to have to find ways to stack all of that together depending on what resources are available to which geography.

Makes sense. And so to bleed for a second into the question of water management, I remember you said something once to me that was very chilling, which is that it's possible that by 2030, California could see all of its precipitation as rain. And as someone who likes to drink water here in my house in California, I found that very concerning. So is, I mean, do you think that a potential answer to that problem is building a whole lot of dams and more reservoirs such that we can actually sort of replicate the snowpack, I guess, as our water storage system? So I think that that is the, it is the natural and immediate first conclusion to draw. Because if we receive all of our water in 30 days of the year and it's all coming as rain, we have to find some way to capture that, that, and so that it can be used through the other, you know, 330 days of the year.

So I think where we see a lot of, and there are some new residents. reservoirs that are being proposed in the state of California that are moving through the development process. And I think that the urgency around those reservoirs has increased as some of the science has become more clear that the prospect of a snow-free Sierra is something that, unfortunately, is probably not hundreds of years away, but is, you know, something, again, that's maybe decade-plus away. It will be interesting coming out of this winter to see if recency bias impacts this, because, again, it's just always, like, We have a, we, we, it's hard as humans to not have recency bias. And like right now we're staring down record snowpack and, et cetera. The approach, though, that we think is, is more durable, is not only building new reservoirs in a traditional sense, but instead investing in distributed approaches that help, that that can incorporate hydro, but that importantly look to bolster groundwater recharge. At the end of the day, water in the ground.

for the last, for all of California's recent history, actually, going back decades. Ground, we have had a net draft on groundwater pretty much every year of something like a million acre feet a year. Without groundwater, we need groundwater. So at the end of the day, groundwater becomes the reservoir and the challenge is how do we get precipitation into the ground? And frankly, I think that's going to be the place that we have to focus on to maintain our water supply and water security, not just building new traditional reservoirs. Really quickly, functionally, how can we do that? Because you mentioned this earlier, that beavers have helped with this, right? That if you reshape rivers, you can help recharge

groundwater? Can you say a bit more about how that works or how we would know how to do it in a way that is actually recharging to groundwater? Yeah. Well, so it's as, I mean, it's getting water on the landscape. So, and it's happening already. So there's some really interesting programs that number of irrigation districts and California State departments have are already implementing to work with farmers, to have farmers agree to flood their fields in the winter, with winter rains happening right now as a result of all the water that we have or all the rain that we've received. And we just need to do a lot more of that. That's like step one because we can just do that today and we need to do as much as we can of that. With proven

track record around that in terms of actually resulting in water going into the ground, which then eventually comes back out and is accessible. The beaver piece is one which we, again, there's lots of projects that have been done to reintroduce beaver into streams that are going dry every year in the summer, and once beaver are reintroduced, you have reprennialized flow. Again, that's just simply a matter of having water sit on the landscape for a longer period of time, more of it goes into the ground. Once the water table is risen enough, you have stream flow year round. And that is something where we, again, it's, it's a, it's funny because these are all solutions that don't require new technology. These are just

solutions that require implementing practice changes and land use changes. And so, And I should remove the word just and replace it with, like, politically intensive stakeholder negotiations because that's what that means more than necessarily a technology solution. Right. Yeah. So not easy, but I think we're creating an interesting sort of playbook here for how to make hydro helpful and not hurtful, which helps to expand it. So you've mentioned, you know, basically creating the right sort of like river diversion

or leakage, you know, to help maintain the flow for animals and fish. We've talked about using technology to do a better. job of predicting exactly what your output is going to be, what sort of needs you have as you're building your dam. We've talked about working with the beavers and the farmers to make sure that everyone's on board with groundwater recharge. To ask you another leading question, what about fish? So fish obviously need to be able to traverse the river, but they also ideally need to be not harmed by dams and turbines. So what do we do there? Yeah, absolutely. So we, on the fish side things. Upstream passage is one which is a, so fish, fish are a matter of both getting fish

upstream when they need to go upstream, downstream when they need to come downstream. Upstream passage right now is generally addressed through fish ladders or bypass, more naturalistic bypass channels that fish can also navigate upstream. And those are become increasingly, for salmon, so again, this is where context is really important. Some fish species do really well with kind of the classic fish ladder, if you've ever been to a hydropower plant in the West. Many of them have them. They were all designed for salmon because that is the kind of primary species that obviously every year needs to move up up river. And they do work. They don't work perfectly. And they don't work perfectly. The ones that are designed for salmon do not work for

eel or for other types of fish. And so one of the things that has broadened over the last decade or to is more different types of upstream passage that becomes more appropriate for different types of fish species. And that's just an important consideration. At this point, there are a number of things that now we can use to help get fish upstream. Downstream passage is an entirely different challenge because at the end of the day for a hydro plant in general, we're trying to run as much of the waters we can through a turbine to produce power. But we obviously don't want to put fish through, well, conventional turbines, unfortunately, are, you know, result in fish that often have a quick end to their life. And so as a result, we don't want to put the fish through

those existing turbines. To avoid doing that, the traditional approach that has started to become used in the last decade or so is what are called fine fish screens. These are meshes, basically, where you're trying to really keep fish from getting through. Problem with screens, is that they're not just expensive, but they also clog frequently. By definition, you have to keep them clean, and so it becomes not just CAPEX, but OPEX. And then finally, unfortunately, screens have been increasingly shown to not necessarily keep as many fish out. There's a very rigorous study that was just completed in Germany and Austria that just shedding a little bit more light on the fact that a lot of stuff gets through screens that you might not think. So I think one of the things that, so we focused on that and said simply, if we can put fish through a turbine safely, then that's a solution that is, again, a lot of our mantra is if we can allow hydropower, enable hydropower plant owners to continue operating a hydropower plant, but make it just part of their operation that they're no longer harming fish, then that is a good thing to do.

So what we have done is, yes, and I think there's been a lot of interesting work done to show to lead the way. And I've been fortunate to work with a team that has, I think, really added some important advancements to the body of work, showing that it is possible to actually design high-performance, fish-safe turbine blades. And what we mean by that is that you don't compromise on power output. You are able to pass fish at near 100% passage directly through the turbine. and I mean, those are the two things. So basically, because at the end of the day, if you don't have to compromise on power, fish go through safely, and you don't, obviously, and then cost, so it's cost parity to conventional, but you don't kill fish and you generate the power.

So how do you do that? What is it about your turbines that enables you to maintain that power output without killing fish? Yeah, it's all in design of the blade shape. So the blades themselves specifically have a very thick leading edge. that thick leading edge creates what is called a stagnation zone in front of it, but very, like, simply you can think of it as a almost like an airbag in front of the blade, and that airbag basically deflects fish as well as debris around the blade, as opposed to a conventional thin blade, which results in a really sharp strike.

So that's one part of the design, and then the other part of the design is that the blade itself swoops forward. And that is important because it addresses, it allows us to keep the impact of a strike the same as we move from the hub of the turbine to the tip. And if you've ever been on a merry-go-round, you know, if you're out at the outside edge of the merry-go-round, you're going a lot faster than if you're at the inside of the merry-go-round. And so to deal with that physics, the swoop of the blade forward basically makes any strike out at the tip a glancing and deflecting impact as opposed to a blunt, sharp impact. And those two things basically, you know, create a turbine blade that has now been shown many times over to be greater than 99%

safe for fish passage. That's awesome. And so the fish safe solution that you specifically have it, Natal, is that something that you could theoretically put onto any dam in the world, or are there certain places where it kind of fits or doesn't? Yeah, no, it wouldn't be for every dam. The operating space, it's quite broad, but not for all. So the operating space we work in is up to about 125 feet of head, which is a large dam from, but there are hydro projects that are, you know, have much higher structures yet still.

But if you're in that range under 125 feet of head, that's the top end. And yeah, we can do turbines from, you know, probably the largest project we're contemplating right now would be over a gigawatt where there's many, you know, we're talking, you know, you're talking 10. A lot of these bigger hydro projects have particularly the run of river ones where, again, you can have 500 megawatt gigawatt runner river projects. They're on big rivers. they have many turbans in them. Each of those turbines tend to be, you know, somewhere between 20 and maybe 80 megawatts in individual unit output,

and then you'll have anywhere from 10 to 20 turbines in a plant. And so it's a pretty classic upgrade situation where we think we've, screening those plants is very challenging. But if we, again, can replace old turbines in a plant like that, you can all of a sudden have a massive impact on environmental performance, while also repowering it with efficient modern turbines. That's really kind of tie all of this together.

So globally, headwinds and tailwinds, from sort of like a policy perspective or just sort of generally, like, how do you feel about the outlook? Are you feeling bullish? Like hydro has what it needs and it's really going to take off. Are you concerned about some of the challenges

in places where there are, you know, I don't know, I guess environmental or other kinds of concerns that are going to potentially present serious headwinds? particularly for perceived and not real risks, or what are you thinking about kind of the overall picture for hydro? Yeah, I am very excited about the future for hydro right now. I think that we face a, there's a real material opportunity

to transform a massive chunk of the existing installed base. There's something like 130 gigawatts or so of hydro that is going to turn over here in the next decade, and i.e., existing operating assets, need new equipment, real opportunity to make sure that those plants stay online. We do not want to lose those megawatts and that we can upgrade them for the next 40 years of their life with fish safe equipment, with better forecasts,

better data and analytics to improve their operations. So I'm very excited about that. It's massive opportunity. Really important to make sure that it happens. I do think the concern is that if we on both sides, if we don't move fast enough to really make a difference in those upgrades, then we risk having projects that continue to have more negative impacts on the river ecosystems. And I think the risk that extends from that is simply more negative environmental performance

will result over time in curtailment of the asset, which means that we're losing really good energy, reliable energy that we need, which then impairs the transition to a zero-carbon grid. So I think it's a risk. We do have a very big chunk of plants that need these upgrades in the next 10 to 15 years, and that represents a massive opportunity, which we're really excited about. That makes a ton of sense. So just to bring this then a little bit more closer home to in the U.S. here, what's kind of the policy landscape these days?

Are there incentives for hydro in the IRA and some of the other recent legislation? Are you part of the team that's concerned about permitting reform? What are some of the sort of good news and bad news stories with respect to policy? And what in your dream world would you see with respect to U.S. federal policy for hydro? So, yes, I think in the infrastructure bill, which was past two years ago, there was a very big chunk of money directly for upgrading hydro and making various improvements in existing hydro as well as advancing development, something like $2.5 billion. directed federal dollars out through the DOE primarily.

So that's one, very positive. And then in the IRA, hydro was included in the broad extension of the tax credits that support renewable energy deployment. So that was a very positive move. And then there was also a big chunk of funding that went to, again, through the DOE to a set of programs that are helping to fund environmental improvements specifically at hydropower. So at hydropower plants.

So some really good movement on policy. That's awesome. Okay. And anything that you're waiting for, that you're hoping for, how do you feel about permit reform? Do you need any of that stuff? Regulatory reform would be really great. Yes. I think the thing I'm more concerned about, actually, though, is interconnection.

I think overall, I mean, yes, regulatory reform, absolutely critical. But frankly, hydro is, has been. working hard on regulatory reform for a decade or more already. And we've, I think, made some good progress working with a number of stakeholders in the environmental community. So I think actually there's some really good momentum there. Interconnection is the thing. Interconnection is to me the element for new build, not for repowering, but for new build is really, I think, the thing that is going to be a huge issue and continue. it already is today and will continue to be a major issue that has to be dealt with if we're going to

achieve the velocity that we all really want to see with respect to transition to a clean grid. Well, you're certainly not the first person to say that in the context of renewable energy. So that might be worth a whole catalyst podcast one day. But thank you so much, Gia. This has been a really fun conversation. I learned a ton and wish you all a ton of luck. Yeah, well, thank you. It's a real pleasure to be here.

I really appreciate it. Gia Schneider is a co-founder and the CEO of Natal Energy. The show is a co-production of PostScript Media and Canary Media. You can head over to canarymedia.com for links to topics we covered today. And as always, PostScript is supported by Prelude Ventures, a venture capital firm that partners with entrepreneurs to address climate change across a range of sectors, including advanced energy, food and agriculture, transportation and logistics, advanced materials in manufacturing, and advanced computing.

This episode was produced by Daniel Waldorf, mixing by Roy Campanella and Sean Marquand, theme song by Sean Markwand. I'm Laura Peerpoint, and this is Catalyst.