Pepperell Hydro Company LLC

    In 2004, Swift River Hydro Operations Company (SRHOCO) purchased Pepperell Hydro Company LLC from the liquidators of the Pepperell Paper Company.  Built around 1917-18, the hydro plant is designed with 3 vertical Francis turbines.  The intake at the dam on the Nashua River is connected to the forebay of the powerhouse by a wood stave penstock.  Over the years, some of the original equipment has been damaged, repaired and in some instances replaced with equivalent runners or rewound generators with the same specifications as the original hydro generating equipment.  During 2004 and 2005, Pepperell Hydro has refurbished the hydro station and brought it back to its original design flow and capacity.  The rehabilitated and new equipment, together with installation of an automatic trash rake and control system automation will increase long-term average production to 7.1 GWh per year.

Pepperell Dam behind Main Street Bridge Crossing the Penstock

    The Pepperell Hydro station was formerly the primary electricity supply for Pepperell Paper Company's (PPC) paper mill.  Manufacturing was located at that site in the mid 19th century because of its hydropower potential.  When the paper mill closed in 2002, the plant operators were fired and the facility was maintained by a single operator and a helper, who had previously maintained the hydro station before becoming an operator.  Regular maintenance ceased at the dam and a hydro plant that generated renewable energy on the Nashua River for more than a century was nearly lost.  The PPC story is typical of many mill towns in the Commonwealth.  Swift River Company (SRC) and its affiliate SRHOCO were formed to preserve the skills needed to finance and rehabilitate existing renewable energy projects and to restore the civil structures and equipment that convert water into non-polluting electricity.  SRHOCO has acquired the engineering plans, shop drawings, repair equipment and skills necessary to maintain and operate hydro turbines and generators that still have many decades of useful life left before they must be replaced.

    Most importantly, Swift River believes that there are a few select locations where river flows and head combine for efficient hydro generation. Plants at existing dams are already located at such efficient hydro sites, and rebuilding them would help Massachusetts to rely more on local renewable energy resources.  The Massachusetts Green Power Partnership (MGPP) recognized this potential and awarded Pepperell Hydro Company with a 10-year contract to purchase renewable energy certificates (RECs) enabling the Webster Five Cents Savings Bank to finance rehabilitation of the century-old hydro plant.  The plan was to replace T-1's runner and restore T-2 or replace it with an equivalent turbine/generator set while continuing to generate power with T-1 during the construction period in 2004 and 2005.

    SRHOCO has a machine shop and specialized tools and shop equipment needed to rehab mechanical and electrical equipment manufactured in the early days of the industrial revolution.  NIMBY battles faced by new energy projects today are replaced by grateful municipal support in towns like Pepperell, Turners Falls, Ludlow, Wilbraham, Russell, Sturbridge Village, Palmer, Woronoco and Winchendon where SRC and SRHOCO own and operate small hydro projects.  Dams are maintained, floods damage prevented, riverine habitat preserved, low cost energy generated locally and people find jobs maintaining facilities that their fathers and grandfathers built.

Pepperell Hydro Company's New Facility Was Built between 1917 and 1918

    In New England, reliance on locally generated "green" power is widely supported by consumers willing to pay a bit more to increase the renewable share of the electricity they buy.  When restructuring the electric sector, the legislature mandated that renewable energy must increase annually by enforcing the Massachusetts Renewable Portfolio Standard (RPS).  The "renewable attribute" is separate from energy generation and may be sold to a third party.  (See Energy Sales and Green Certificates for an explanation of renewable energy certificates -- RECs).  The RPS requires that distribution companies increase the renewable share in their supply portfolio.  Thus, REC prices are expected to rise in time, unless there is a large jump in the supply of new green technologies growing faster than demand for electricity.

    You will note on your monthly electric bill, there is a small charge for development of renewable energy technology.  These funds are administered by the Massachusetts Technology Collaborative (MTC), which has initiated a large number of programs to stimulate renewable energy experiments and to expand the use of green energy technologies.  Among these programs, MTC decided to stimulate the trading market and supply of RECs.  It called for bids from renewable energy producers willing to contract to sell their RECs for the next ten years to MTC.  11 proposals were received, 2 were hydro projects submitted by Swift River Company.  On November 13, 2003 MTC announced that it had selected Pepperell Hydro's proposal to re-power on turbine/generator set and replace another runner, upgrade the switchgear to automate run-of-river operation of the 3 hydro generators in the existing powerhouse.  MTC signed a 10-year REC Purchase Contract that provide credit support for Pepperell Hydro's project financing.

    MTC enhanced the financing by placing the future REC purchase revenue in escrow for credit support of the loan required to rebuilt the Pepperell Hydro station.  Thus, Pepperell Hydro was able to offer loan enhancement in the form of a debt service reserve fund backed by the MTC's escrowed credit fund as part its 10-year, fixed price contract to purchase RECs from the capacity restoration and efficiency increases made possible by the extra revenue from sale of  renewable attributes.  Pepperell will also also sell Connecticut Class I RECs generated by the per-MTC award capacity in the open green certificate market.  In addition, the majority of the energy produced by Pepperell Hydro will be sold to the ISO market (the marginal cost energy market where all non-contracted suppliers must sell energy). 

Panoramic View of New Trash Rake Location, Overflow Spillway (left) and Turbine Pit Intake Gates

    Massachusetts was a leading state during the birth of the industrial revolution, in part because towns like Waltham, Lowell, Lawrence, Holyoke, Turners Falls built canals to carry water to what became a local manufacturing explosion based on hydro mechanical power.  At other locations, wherever there was a drop in a river like the Nashua River in East Pepperell, investors built hydro-powered mills, damming the rivers to capture its energy.  Rehabilitating and re-powering sites previously used for hydro generation takes advantage of the existing infrastructure of power lines, substations, and peaking facilities while replacing public maintenance and clean up of rivers, historic dams, canals and flood control facilities with cost effective private investment capital.  The sale of RECs is an efficient method to inject fresh capital to refurbish proven hydro projects that would otherwise be abandoned.  How better to restore generating facilities that were shutdown when the region's industrial load went south, closing mills like Pepperell Paper which fired skilled mill wrights.  Income from REC sales has refurbished an aging powerplant and reemployed a few skilled mill hands who lost their hometown jobs when the paper mill closed.

T-1 Westinghouse 640 kW Generator and Woodward Governor in June 2003

        [Projects]         [Services]         [News]         [D. Hobbs Contracting]