Alcoa Inc. to sell Tapoco Hydroelectric Project to Brookfield Renewable Energy Partners
From Staff Reports
Tapoco is a four-station hydroelectric project located on the Little Tennessee and Cheoah Rivers in East Tennessee and Western North Carolina, and is operated by Alcoa Power Generating Inc., a wholly owned subsidiary of Alcoa Inc. The transaction will include the four generating stations and dams, 86 miles of transmission line, and about 14,500 acres of land associated with and surrounding Tapoco.
Alcoa Inc. anticipates receiving proceeds of $600 million from the sale upon closing, which is subject to customary federal and state regulatory approvals. The transaction, which involves non-core assets, is expected to close by year-end.
Tapoco is licensed by the Federal Energy Regulatory Commission (FERC).
Tapoco was originally developed by Alcoa to provide power for its aluminum smelting and rolling mill operations in Alcoa. The four dams – Calderwood, Santeetlah, Chilhowee and Cheoah – came into service between 1919 and 1957. Construction began on Cheoah Dam in 1916 and was completed in 1919. At the time of completion, Cheoah was the world’s highest overflow dam at 225 feet. The dam was made famous by serving as the backdrop of the jump scene in the 1993 movie, “The Fugitive,” starring Harrison Ford.
In August 2010, Alcoa kicked off a $110 million modernization project at Cheoah Dam to increase the dam’s efficiency and energy output and increase the life of the dam by at least another 40 to 50 years. The modernization project was given a jump start when the U.S. Department of Energy announced it would award Alcoa a $12.95 million grant as part of the 2009 American Recovery and Reinvestment Act. The grant was issued by DOE’s Wind and Hydropower Technologies Program.
The modernization followed the relicensing of the Tapoco project by the Federal Energy Regulatory Commission. The new 40-year license was effective March 1, 2005, and outlines protection, mitigation and enhancement measures for the project that address ecological resources as well as other beneficial uses of the Cheoah and Little Tennessee Rivers, including hydropower generation, watershed protection, endangered species enhancement, fish passage and recreational opportunities.
Brookfield Renewable Energy Partners operates one of the largest publicly-traded, pure-play renewable power platforms globally. Its portfolio is primarily hydroelectric and totals approximately 5,000 megawatts of installed capacity. Diversified across 67 river systems and 10 power markets in Canada, the United States and Brazil, the portfolio generates enough electricity from renewable resources to power two million homes on average each year.