SMUD set to buy PG&E’s only hydroelectric powerhouse on the American River for $10.4 million

The Sacramento Municipal Utility District is moving forward with plans to buy a hydroelectric powerhouse and reservoir from Pacific Gas and Electric Co. for $10.4 million.

In a joint statement, the local utility providers announced that the Chili Bar Hydroelectric Project — a dam, reservoir, spillway and powerhouse that generates electricity north of Placerville on the South Fork of the American River — would be changing hands after SMUD’s board of directors voted Thursday evening to greenlight the purchase.

The purchase is expected to be finalized in 2020.

PG&E said the power values and generation demand on the grid have been declining, so it has sought to get rid of small hydroelectric plants, especially those that are geographically remote.

The Chili Bar generator, which is the only hydroelectric project that PG&E owns in the American River watershed, provides “marginal economic electric generation benefits for PG&E customers,” the statement said. “In some cases, (PG&E) has transferred such projects to regional entities for a better fit.”

SMUD already owns 11 dams and eight powerhouses upstream from Chili Bar in its Upper American River Project — known as the “stairway of power” – so it has been coordinating with PG&E’s Chili Bar operations for some time, according to the statement.

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SMUD set to buy PG&E’s only hydroelectric powerhouse on the American River for $10.4 million, by Vincent Moleski, The Sacramento Bee, August 16, 2019.