Park board stalls hydroelectric deal


After a fruitless trip to the Legislature and failed negotiations, plans to build a hydroelectric plant near the St. Anthony Falls have stalled.

Crown Hydro LLC has been trying for 12 years to build a 3.2 megawatt plant near the historic falls. But the Minneapolis Park and Recreation Board has consistently blocked the project from going forward, citing a fear of its impact on the Falls and the financial reliability of its investors.

In late May, the Federal Energy Regulatory Commission, the agency that administers hydroelectric permits, requested a status update from Crown Hydro. If no signs of progress were evident, FERC could terminate the license to build a plant on the river.

Crown Hydro sent FERC a 90-page recap on the project’s stunted progress in recent months and chronicled what some state legislators have called the Park Board’s “unnecessary delays.”

Celeste Miller, a FERC spokeswoman, said Crown Hydro’s response is currently under review and there is no timetable for a decision.

Park Board President John Erwin wrote a letter to FERC in late June, calling Crown Hydro’s letter a “one-sided rendition” of the events.

“Crown Hydro apparently believes that it is entitled to control of the public park land on terms they alone propose and no others,” Erwin wrote.

Rep. Mike Beard introduced a bill in March that would have given Crown Hydro the ability to bypass the Park Board, but the bill made little progress. Beard said he doesn’t plan on bringing it up during a special session.

The bill’s companion in the Senate, authored by Sen. Gen Olson also stalled.

A similar legislative effort fizzled in 2009.

Despite Beard’s insistence that the bill won’t come up, Crown Hydro asked FERC to wait until legislation was passed during a special session before making a decision on its permit.

Tim Keane, an attorney for Crown Hydro, remains optimistic that the issue could resurface this year.

Crown Hydro met with the Park Board frequently in the spring to draft an agreement to build on the west bank of the Mississippi River. The Park Board requested that William Hawks, Crown Hydro’s owner, give up his stake in the company to a third-party investor. Crown Hydro reluctantly agreed, and is in talks with other investors to take over the project, Keane said.

Erwin said commissioners grew wary of the project’s financial stability when reports surfaced that Hawks’ home on Lake Minnetonka was in foreclosure.

“We need to know that anyone that is doing a project on public land can do the project,” Erwin said. “So we’re just protecting the public’s interest.”

But talks broke down between the two sides when the Park Board made several changes to the agreement it was scheduled to vote May 18.

One change would have given the Park Board control of the plant from July 15 to Sept. 15, which would allow them to shut down the plant whenever it wanted.

Those changes made the project financially unfeasible and therefore difficult for Hawks to sell his stake in the company, Keane said.

Proponents of the project point say it will be nearly invisible on the shore of the river while quietly generating enough clean power for more than 2,000 Minneapolis homes.

Erwin declined to comment when asked if the Park Board would bring up negotiations again with Crown Hydro.

If the issue doesn’t come up again in the Legislature, Keane said there are other options to bring the project to fruition.

“I’m like an airplane pilot looking for a place to land,” Keane said. “If one runway is on fire, I always have another one to shoot for.”