Hydro Electric project proposed for Denny's Dam
by Sandy Lindsay

November 19, 2016

Town Council

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Patrick Gillette of Kinet Ontario, a subsidiary of Natel Energy Inc. of Almeda, California, presented a delegation to Saugeen Shores Council on Monday, November 14th, for a proposed hydro-electric generating facility at Denny's Dam on the Saugeen River in Southampton.

The company is submitting an application to the Independent Electricity Operators (IESO) Feed in Tariff (FIT) process under the Ontario Ministry of Natural Resources (OMNR) .

If a FIT contract is awarded, the Ministry must approve the dam's conversion to waterpower hydro electric production.  It will take two years for the Environmental Assessment and "... overall, the process will take six to eight years to come to a decision so that everyone can get comfortable with it."

According to Gillette's presentation, "The final design will meet all of the Ontario Ministry of Natural Resources Design and Operational Principles and any subsequent site-specific requirements. This includes the 120% bypass requirements, dam safety and flood mitigation efforts."

When asked by Vice Deputy Mayor Diane Huber if Saugeen First Nation will be consulted, Gillette pointed out that Denny's Dam is owned by the Province and administrated by the Ministry of Natural Resources.  "The land along the river is Crown land," said Gillette, "and Parks Canada is already working with us on two other projects, one in Peterborough (35kW) and the other in Bobcaygeon (35kW), both on the Trent Severn Waterway."

According to Gillette, the south shoreline is also Crown land administered by the MNR.

Natel currently has three similar projects in the United States - Monroe project in Oregon (sold to Apple Inc.), Freedom Falls in Maine and the Buckeye South in Arizona

photo from Natel files

Monroe Project (250kW)

Natel's Monroe Project in Oregon was a 250 kW capacity while Denny's Dam is proposed to be a 500 kW project linked to Hydro One's grid system.

Gillette was requesting that Council direct staff to engage with the company and to answer questions about the project.  "It's the provincial government's way of ensuring that we are talking to municipal governments about anything that is happening in their regions."

According to Gillette it normally takes about $250,000 to do and that's were Kinet would have to come forward with all the data including how it's going to be built, habitat and archeological studies and demonstrate there will be limited impacts within the footprint of the project.  "This will all be done in a public process in which the town would be involved and it is managed by the Ministry of Natural Resources and Ministry of the Environment."

"After rmeeting with staff on November 28th," said Gillette, "we would be requesting a support resolution for the project."

"Your presentation makes absolutely no reference to anything aboriginal," said Vice Deputy Mayor Diane Huber. "You say that the land is MNR land but it's also territorial waters for Saugeen First Nation so how do you plan to engage that community in this process."

"The Ministry as the Crown is directing us and, therefore, the duty to consult is directed from the province. so what would occur is that, at the time we issue a contract, we have to send a Crown release package and, at that point, MNR could start that engagement with the indigenous communities within the watershed and when they want us to come forward they would bring us forward to start the consultation.  This would start formally at the applicant stage and then there is a duty to consult during the environmental process."

Councilor Dave Myette informed Gillette that prior to his presentation there were two representatives from the Lake Huron Fishing Club (LHFC) who spoke in the open forum session of Council. Councilor Meyett is also the Manager of the salmon fish hatchery in Port Elgin. 

"We have a very keen interest in the waterway and the points that the LHFC representatives made was that the primary purpose of the dam's location is for lamprey control or barrier to stop lamprey from breeding up-river and then attaching fish.  Have the lamprey been considered?  Second, is that the Saugeen waterway is in the top 10 rainbow trout migration rivers in North America if not the world.  Our club operates two hatcheries that breed salmon and trout of several varieties and release them in the river above and below and salmon and trout have two specific dangers points in life ... one when they are going upstream to spawn for which we have provided several fish ladders and when smolt (babies) go back downriver to go out into the lake."

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Patrick Gillette

"These hyrdro projects create grave danger for the smolt when they are going downriver as they can't distinguish water flow and, in fact, go where the flow is fastest through the turbine," added Myette.  "From what I have assessed is that the turbine is a 'cuisine' type with a blade design as opposed to a rotary type where smolt could potentially pass through.  We would like to see data on the effect on fish impact."

According to Gillette, Parks Canada has been working with the company.  "They have bought into it," he said. "as it is low impact and 'fish friendly'."

"Well, as a club and town, we would very much want to be involved in discussions," added Myette, "to ensure that the fish will survive.

Gillette said that the project would not in any way be "... allowed in any way to enable lamprey to come up.  You know more about the river system and it's incredibly helpful for us.  The fish ladder is there and we would probably put the installation on the other side unless told otherwise.  Fish barriers would also be put at the intake and tail end.

Deputy Mayor Luke Charonneau also asked when the Saugeen Valley Conservation Authority (SVCA) would become involved.  He also wanted to know what the off-site impact would be with regard to transmission.  "Will there be additional construction to accommodate transmission from the devleopment."

Gillette said that there may be a low-voltage distribution line managed by Hydro One.  "That line would be directed over Crown land or existing right of way to a point where Hydro One tells us.  It would provide a local source of power.  We are hoping to start engagement with the Authority and we would like to bring them into the environmental process as much as possible."

Councilor John Rich asked what the spin-off benefits would be for the community.  "Why should we go foward with this?"

Gillette said that in the event of an ice storm, Hydro One could bring up power faster.  "The project would cost about $5Million to build and half of that would be spent locally with trades and big items such as steel, cement, rebar and copper for a benefit of about $2Million in the community and, at least $250,000 spent locally for study work.  There would be some tax benefits 10 years after the project has been running collected by treasury and part of that would be distributed to the municipality. Part of the outreach process is how do we make this as beneficial as possible to the town."

Gillette added that they don't have a lot of direction from MNR until the project is approved under the FIT.  "MNR says we are on our own until we are approved under FIT.  We don't know a lot about the project right now."

"So," said Councilor Neil Menage, "that's the rub.  You are asking us to support you for the FIT contract as you have to get the FIT contract before you can start discussing socio-economic benefits in the Environmental Assessment (EA).

"There is a $40,000 grant to start engagement and partnership discussions and you can apply for the grant now and we can support you (town) in that application.  We want to see you get those benefits but we have limited knowledge about the project right now.?

Councilor Cheryl Grace asked, if approved, what would be the operational length of the project.  Gillette said that initially it would be 75 years with an additional 75 years with equipment replacement. 

She also asked if one of the incentives for being in Ontario was a Canadian lower tax rate.  Gillette said that it was not a consideration but that Ontario appealed to Natel because of the "... attractive hydro electric rates. A large portion of their business is in Ontario, Quebec, and the eastern states.  Natel views Ontario as a hub and they want to demonstrate their technology.  Parks Canada is also very interested in what they are doing."

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Sunday, November 20, 2016