Keltneyburn Hydro

Customer: Keltneyburn Hydro
Location: Perthshire
Technology: Hydro
Commissioned: May 2010
Installed capacity: 2MW
Customer since: 2010

The 2MW Keltneyburn run-of-river hydro scheme was commissioned in May 2010. Although capable of providing enough power for 1,300 homes, it is almost completely hidden from view in the Perthshire countryside.

The project, owned by a group of private investors, generates electricity using the natural flow and elevation of the river Allt Mor, close to Aberfeldy. A low level weir allows water to enter a buried pipe leading to an underground powerhouse with twin Pelton turbines.

The scheme comes just within the Feed-in Tariff 100kW-2MW hydro band which offers a slightly better financial return than under the Renewables Obligation.

In addition to receiving a payment per kilowatt hour under the FiT generation tariff, the company has also chosen to enter a Power Purchase Agreement (PPA) with SmartestEnergy for electricity supplied to the grid instead of taking the fixed FiT export tariff.

“That is providing us with additional money over and above what the FiT scheme provides. We are getting around 10-15% more under a PPA than we would under the export tariff and that uplift basically covers our whole operating costs for the year so it is quite significant,” said Keith Vallance, who oversaw the project on behalf of Keltneyburn Hydro Limited (KHL).

“We feel that although there are fluctuations in the energy market the long term trend will be for prices to increase and that the gap between the export tariff and the PPA will get wider as the years go on.”

As well as better financial returns under the PPA, Keith said working with the company has provided other benefits:

“Iain Robertson, SmartestEnergy’s Business Development Manager for Scotland, has guided us through the various processes under the FiT scheme and has been very supportive throughout.”

Whilst the scheme is the only renewable generating project which KHL are currently involved in, the company hopes the experience gained on Keltneyburn will provide further opportunities in the future.

“We have gained a lot of experience in developing this scheme which we are keen to put to use elsewhere,” said Keith.

“We are currently looking at other hydro schemes which either have consent but need financial backing or are going through the assessment process.”

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