New form of hydro energy won't threaten migrating fish
by: Christopher Onstott Gregg Semler, CEO of Portland startup company LucidEnergy, says the company can make green renewable energy at a competitive price, without government subsidies, in the inside of water pipes.

Imagine producing cheap hydropower without having to build a dam or threaten migrating salmon.

Portland startup LucidEnergy says it's figured a way to do it -- inside a water pipe.

We're not talking high-tech. It's clean tech, part of a wave of emerging technology companies that help improve the environment.

Lucid has developed a simple five-blade turbine built inside a segment of water pipe that can be installed when a utility, like the Portland Water Bureau, replaces a stretch of aging or leaking pipes.

A string of four turbines on a stretch of pipe carrying water downhill might produce enough electricity to power 100 homes, says Gregg Semler, Lucid president and chief executive officer. The payback on the cost of building and installing the system -- without any government subsidies -- "is about three to four times better" than solar or wind installations, Semler says.

Inside a pipe, he says, "We control the conditions and there would be no environmental impact."

As with wind and solar energy, there's no carbon emissions from Lucid's turbines. But it generates electricity almost around the clock, not just during daylight or when it's windy.

Cost savings

Lucid is still proving its technology works, and trying to convince utilities it won't cause problems or reduce water pressure at the customer's tap. The company faces its first big public test April 26, when its inaugural public demonstration project opens at Riverside Public Utilities in Southern California. 

Lucid has tested four generations of turbines during the past two years in Riverside. The fourth one, installed in January, has worked "flawlessly," says Kevin Milligan, the utility's assistant general manager for water.

"I think it's great technology," Milligan says. "It could be widely adopted by water utilities and result in some significant cost savings. And it's green."

Lucid is negotiating to do three trial installations for Portland Water Bureau, which uses gravity to pipe Bull Run water downhill to most of its customers.

"Where we can employ them, it makes sense to do so," says Michael Stuhr, the bureau's chief engineer. "From an engineering point of view, they are an elegant piece of machinery, and I think pretty trustworthy."

The bureau typically digs up five to 10 linear miles of dirt a year to repair pipes or lay new ones.

Lucid also is negotiating projects in San Antonio and New York, and attracting interest from as far afield as Israel and Zambia.

Clearly, in-pipe hydro systems won't produce enough clean energy to replace big coal-fired plants that are the leading source of greenhouse gas emissions in the Northwest, says Angus Duncan, chairman of the Oregon Global Warming Commission. But it sounds like a promising "niche resource," Duncan says, especially if it creates jobs here.

Switching gears

Lucid was founded in 2007, based on the work of three Russian scientists who thought they could produce hydropower from rivers without harming fish. When that proved elusive, the company shifted focus. Rod Schlabach, Lucid's head of engineering, came up with a concept for an in-pipe hydro system, Semler says. The company scored an important backer, part-owner Northwest Pipe Co., a $387 million-a-year pipe manufacturer based in Vancouver, Wash.

"They know where every pipe opportunity is in the United States," Semler says, whether it's a water utility needing new pipes or repairing old ones.

In December 2010, Northwest Pipe Chief Executive Officer Rich Roman approached Semler about investing in the company, when Semler was running Pivotal Investments, a Portland venture capital firm specializing in clean tech companies. Ultimately, Roman convinced Semler to leave his job and become Lucid CEO, starting last August.

As part of the deal, the company is being moved from Goshen, Indiana, to Portland.

Lucid's Pearl District headquarters is largely empty and the company's name isn't even on the door yet. But the remaining 10 employees in Indiana will relocate this summer, Semler says.

How it works

Lucid's prototype uses a 25-foot-long steel pipe, 5 feet in diameter at each end. It's tapered toward the middle, causing water pressure to rise as it hits the turbine's five teardrop-shaped blades. The blades are unobtrusive enough that in-pipe cameras show you can see through the blades.

Water pressure recovers soon after it moves the blades and produces electricity, Semler says, enabling another pipe segment with another turbine.

"You can add as many turbines as you have pressure to extract," he says.

In Riverside, water pressure loss from each turbine is minimal, about three to four pounds per square inch, Milligan says.

Lucid is negotiating with CH2M Hill, a large engineering and planning firm, to play an intermediary role, Semler says. CH2M Hill would buy Lucid's systems and take charge of installation and management of the system, recouping its costs via electricity sales.

The Portland Water Bureau or other host utility would own the system outright after seven years and collect the money from energy sales.

Saving money

Lucid boasts that its system will produce electricity for 5 to 9 cents per kilowatt hour over 20 years. At that rate, Duncan says, it would be competitive locally with wind plants.

Portland-area residential customers now pay 10 to 11 cents a kilowatt-hour for electricity. In California, customers often pay twice as much.

In contrast to wind and solar projects, Lucid isn't depending on federal and state renewable energy subsidies to meet its price target, Semler says. Energy Trust of Oregon subsidies, for example, could lower the cost of the system, but Lucid doesn't want to base its business model on subsidy programs that often disappear, a phenomenon dimming the prospects for new wind power in Oregon.

Electricity produced by Lucid's system could get sold to utilities or power nearby utility operations, such as Portland water pumping stations or an Israeli desalination plant. Semler is enthused about applications in developing nations, where there's a need for water purification facilities in places with no local electricity.

Power generated at the Riverside test site is enough to run 14 miles of city street lights, Milligan says. Energy is his utility's third-highest expense, after labor and capital construction.

At his district's water fields in San Bernadino, he pays 13 cents to 25 cents a kilowatt-hour for electricity, so the Lucid system could save significant funds there.

Each Lucid turbine produces a relatively small amount of power, but there's vast potential for turbines in a nation riddled with old, leaking water pipes. New York City alone has 7,500 miles of water pipeline, Semler says.

If Lucid makes it big, he foresees growing to as many as 100 or 150 employees here. But there'd also be more pipe manufacturing work for Northwest Pipe, which has plants in Portland and Vancouver, and Semler is trying to set up turbine manufacturing in Scappoose.

Portland is a great place to launch clean tech companies, Semler says, because there's so much enthusiasm about sustainability here.

"You can find a customer here," he says. "And if you can find a customer, you can find an investor."

Semler also sees the area's potential to become a magnet for other companies in the emerging "smart water" field.

"I think smart water is going to become the next big thing," he says. "I think Portland could become the center of it."

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