Sweetheart dam gets OK from Forest Service

A hydroelectric dam proposed for a lake southeast of Juneau has moved one step closer to construction, and its backers say groundbreaking could take place in summer 2018.

On Friday, the U.S. Forest Service approved a special land-use agreement for Juneau Hydropower Inc., which is planning to build a 111-foot-tall concrete dam at the outlet of Lower Sweetheart Lake, turning it into a hydroelectric reservoir. The resulting project would generate 19.8 megawatts of electricity, equivalent to about one-fourth of the power Juneau uses today.

The project has already received permission from the Federal Energy Regulatory Commission and the U.S. Army Corps of Engineers. The Forest Service permit was the final major regulatory hurdle remaining for the project.

“I would say we are now moving into the implementation phase, and I see no reason why they couldn’t begin actual construction in 2018,” said Brad Orr, district ranger for the U.S. Forest Service in Juneau.

“It’s green-light go now, as far as the construction is concerned,” said Duff Mitchell, the project’s managing director.

The dam would be built above a series of waterfalls that block natural salmon passage into the lake.

While the project has few regulatory hurdles remaining, Mitchell and Juneau Hydropower CEO Keith Comstock said the dam still has to finish its financial foundations.

In order to get investors, they need to sign customers willing to buy the dam’s power. In order to get those customers, they need to sign an interconnection agreement with Alaska Electric Light and Power that allows them to link the Sweetheart Dam to a power line used by the Snettisham Hydroelectric Project.

“We’re making progress,” Comstock said of that interconnection agreement. “It shouldn’t take very much longer.”

Through a spokeswoman, AEL&P confirmed the interconnection process is ongoing but declined to offer a timeline.

According to filings with the Regulatory Commission of Alaska and past statements by company directors, Juneau Hydropower intends to send most of the new dam’s electricity toward two big Juneau-area projects. About half the dam’s power would go to Kensington gold mine on a yet-to-be-built high-voltage power line.

“I think Kensington burns more diesel and produces more power than the city of Haines and the city of Skagway combined,” Mitchell said. “It’s not an insignificant customer.”

The other half of the dam’s electricity is earmarked for the Juneau District Heating project, an effort to supply space heating to offices and homes in Juneau’s downtown core.

“That’s still the plan,” Comstock said, then added, “The power purchase agreements are there. We just need the interconnection.”

For the Forest Service, Orr said that while Juneau Hydropower does have a “green light,” it’s not unrestricted permission.

“They don’t have carte blanche to simply start construction. We’re still very much part of the process,” Orr said.

When Juneau Hydropower does break ground, Orr said the Forest Service will bill the company for the rock it uses from federal land, and for the timber that will be lost as the lake grows behind the new dam. About 13.5 million board-feet of timber will be available for harvest as an indirect result of the dam’s construction, Orr said.

A state water-use permit is also needed, but Carl Reese, the Department of Natural Resources coordinator for that permit, said his work takes place only when most other permission is in hand.

“In order to issue a water right, we’re legally required to see other permits in place,” he said.

Comstock said engineering is complete for the first phase of the dam, and surveyors spent summer 2017 taking core samples of the terrain where the dam will be built.

Mitchell said the company spent half a million dollars on that effort, but everything is almost ready for a “grand finale.”

• Contact reporter James Brooks at james.k.brooks@juneauempire.com or 523-2258.

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