Regulating district pushes for new Conklingville Dam deal

Capital region counties could be on the hook

By Zachary Matson

The state agency that controls Conklingville Dam and a private company that produces hydropower at the site are far apart as they negotiate a new reservoir operating agreement for Great Sacandaga Lake. 

The Hudson River-Black River Regulating District owns and operates the main dam structure and dictates reservoir levels, while a power station owned by Erie Boulevard Hydropower and Brookfield Renewables generates electricity from the water that flows out of the state’s largest impoundment.

The current reservoir operating agreement – first adopted in 2003 and amended in 2006, 2021 and this year – expires Dec. 31.The outcome of negotiations over a replacement could have far-reaching impact and threaten planned reductions in payments assessed on counties that benefit from the dam’s operation.

The regulating district this year commissioned an appraisal that valued access to the water created by the dam at $2.5 million annually. But Erie, a subsidiary of Canada-based Brookfield Renewables, seeks to pay only to time water releases through its powerhouse, offering about $77,000 per year, according to the regulating district. 

Erie, which operates a litany of hydropower facilities around the Adirondacks, pays for access to 56 feet of water produced because of the Conklingville dam. Erie is currently paying nearly $1.5 million in annual water fees under the operating agreement, according to the regulating district. Its E.J. West powerhouse has the capacity to produce 22 MW of energy at the site.

Mark Luciano, Brookfield Renewable’s stakeholder relations manager for New York, said in an email he would not comment on the negotiations.  

Callaghan argued the value of accessing the impoundment’s water power has increased since the current agreement and Erie should increase its payments to the district. District officials have also suggested that if Erie prevails in negotiations and significantly reduces its payments, the district’s finances would be imperiled.

The district had long relied on downstream hydropower producers to fund its operations through separate beneficiary assessments, but those payments in 2008 were rejected in federal court on the grounds any such bills must be approved by the Federal Energy Regulatory Commission (FERC). The district shifted the budget burden downstream to Albany, Rensselaer, Saratoga, Washington and Warren counties. Last year’s state budget, though, called for easing the counties’ burden by moving certain local tax payments around Great Sacandaga from the district to the state.

“If we lose the significant revenue annually from operation of the E.J. West plant, the relief counties are expecting will be decreased significantly,” Callaghan said.

The underlying reservoir operating agreement requires the regulating district to operate the dam to “maximize hydroelectric energy generation and revenue by the Erie” powerhouse, as well as to serve its statutory role in regulating water flows on the Sacandaga and Hudson Rivers to reduce flood risk to downstream communities. The agreement outlines a water fee paying to maintain the dam that produces the water to generate electricity at Erie’s powerhouse. 

Both Erie and HRBRRD hold FERC licenses to operate the site to produce energy, which expire around 2040.  

Stillwater talks continue

The regulating district also faces a Dec. 31 contract deadline at the Stillwater Reservoir in the western Adirondacks.

Stillwater Associates operates a powerhouse at that dam under a contract that requires the regulating district to purchase the powerhouse if the two parties cannot agree on an extension of monthly payments. 

Callaghan said he expects the district will have to purchase the facility, and the two parties are working with appraisers to determine the value of the powerhouse. The district lacks the authority to generate power, so if it does end up owning the Stillwater powerhouse it would then solicit a new hydroproducer to operate the facility.