The Greene County Commission voted 18-3 Monday evening to enter into an agreement to explore the possibility of generating hydroelectric power with a 75-foot water wheel at Nolichucky Dam.

The vote came after lengthy discussion and after the rules were suspended to allow something that was not on the agenda to be considered.

County Mayor Alan Broyles said that the need for haste was based on the assumption that federal "stimulus" funds may be available for the project, since it potentially involves "renewable energy."

The commission also voted 18-to-2 to release $30,000 appropriated to Kinser Park. There was no discussion before that vote, though in the earlier Republican caucus, Commisioner Hilton Seay said the funds are needed to open the park late this month.

Commissioners John Cox and Rennie Hopson voted against releasing the funds, because of issues related to seasonal campers.

Seay said there is much more to the park than just campsites, and holding up the funds any further would be a disservice to citizens who use the park.

Mayor Broyles said that one part of the energy project could be a 75-foot-tall "water wheel." If built, he said, the water wheel would be the tallest in the world.

The commission authorized the county government to enter into a "letter of agreement" with Energy Systems Group, or ESG. He noted that ESG is the company that helped Johnson City capture methane gas from the Iris Glen landfill and use it to provide heat for the hospital complex at the Mountain Home Veterans Administration facility.

County Attorney Roger Woolsey said the letter of agreement limits the county's financial obligation to $50,000, an amount that he said the county would only have to pay if ESG demonstrates that a project is feasible and will not require county funds, if the county government still decides not to go ahead.

Late in the discussion, Commisioner Tim White said the county government has risked more money with a less likely chance of success, and indicated his support.

White noted that the commission would vote later that evening to contribute $22,000 to the Regional Alliance for Economic Development. White said there is no guarantee that the $22,000 will bring immediate results, or more jobs, yet it is still a good investment.

Later, the Regional Alliance contribution was approved.

Tom Ferguson, who is the Alliance's interim director, said it was very interesting to him to hear the ESG presentation, since the Alliance will introduce its new marketing efforts "directly focused on renewable energy," primarily solar panels and water turbines to generate electricity, on March 25.

In introducing the subject, Broyles said he called Steve Robbins of Hodge Associates, an engineering and architecture firm, "several months ago" to discuss "use of existing facilities at Nolichucky Dam to create renewable energy." Broyles said he envisions an "energy museum" at the site as well.
The dam, which has not been used to generate power since the early 1970s, is owned by the Tennessee Valley Authority.

Broyles said Hodges Associates, at no cost to the county, did preliminary investigations, and determined that the river has enough flow to generate as much as five megawatts of electricity. He said that would be enough to provide electric power to 2,700 homes.

Hodges "determined the concept would work," Broyles said, and then contacted ESG.

"I might add that our legislators at the state and federal level are excited about the concept," Broyles said, but added, "I stress that it is just a concept" at this point.

Danny Price, a field representative for U.S. Rep. Phil Roe, R-1st, of Johnson City, was present. Near the end of the meeting, after the vote, Price rose and told the commission, "Congressman Roe is 100 percent behind you guys, and he's also going to work with TVA."

John Kniceley, of Hodge Associates, said his company, which is a subcontractor to ESG in this project, has worked on $60 million worth of energy projects since 2003.

Kniceley said it is sad but true that Tennessee uses more electricity per household than any other state, 1,370 killowatt hours per month, compared to less than 900 kilowatt hours in California.

Kniceley said he believes that the construction of the water wheel would generate 125 jobs, and would itself become a tourist attraction.

As a tourist attraction, he said, calculations based on data from the University of Tennessee could result in "300,000 tourist days" per year that, at between $75 and $85 spent per day, would total a $20 million annual boost to the local economy.

He said the largest water wheel in north America is 45 feet tall.

Knisley said Oak Ridge National Laboratories is interested in the idea of an energy museum at the dam. He also said that "TVA has indicated it is interested in working with us, but not in writing."

He said that there are "some issues" that must be resolved first, since TVA's board passed a resolution in 1986 that said "no entity but TVA can use their hydroelectric properties to create electricity."

However, he said that U.S. Sen. Lamar Alexander said in talks about this subject that "resolutions are written to be re-written."

Broyles told the commission that the project has "many hurdles to cross" and "hoops to jump through," and will require approval by the Tennessee Department of Environment & Conservation and the U.S. Army Corps of Engineers in addition to TVA, "but we think it can happen."

Commissioners Kevin Morrison, Jan Kiker and John Waddle Jr. voted in opposition, while Commissioner Robbie Morgan was absent.

Phil Pendzola, director of public works for Johnson City, said ESG is a "very stable, growing company" that brought national experts in to help on two major municipal projects, energy savings for public buildings and methane capture.

Pendzola said Johnson City investigated the "intellectual capacity" of ESG by asking chemical engineers from East Tennessee State University to evaluate aspects of the company.

Johnson City also looked into ESG's financial capacity, since part of what the company does is put together funding packages to pay for improvements using money saved or generated by the projects themselves.

Pendzola said the ESG employees who worked with Johnson City on the methane capture projects were "the most ethical group of people " with whom he has ever worked.

The public works director said the methane project is producing a $680,000 revenue stream this year, and Johnson City "didn't put in a dime." He noted that this revenue replaces more than 6 cents of property tax for the city.

David Ames Jr., of Mechanicsville, Va., regional director for ESG, said the company has been in business for 15 years and is a subsidiary of a $3 billion utility company in Indiana.

He said ESG has about 200 employees. Ames was filling in for Russ Nelson, of ESG's Johnson City office, who could not attend.

He noted that, in addition to the Johnson City projects, ESG successfully did energy saving work for the Sullivan County School System about seven years ago, and is now involved in a multi-phase project for the city of Kingsport, including a learning center.

"All told," he said, ESG has done or is currently working on $80 million worth of projects in East Tennessee.

He said Johnson City used an ESG municipal bond fund. Other projects have involved what he called a master equipment lease program.

Ames said ESG is not currently involved in any projects that involve stimulus money, but we are "keeping our ear to the track" should stimulus money turn out to be a good option.

Commissioner Bill Dabbs asked Ames to estimate the number of jobs that the water wheel and associated projects might generate. Ames replied that it would be premature to speculate until more is known.

Commissioner John Cox said it is obvious that building "the world's largest water wheel" would be a "humongous undertaking."

Cox asked if the energy survey on county buildings (the courthouse and annex, 911 building, election commission, detention center, workhouse and EMS building) could be separated from the projects at the dam.

Ames said that it could, but he said he believes, from preliminary studies by Hodge Associates and his company, that the most immediate returns are possible from energy-saving projects.

Ames said his company tries to balance projects that have longer-term potential (like the water wheel) with projects that offer a short-term return, like energy saving projects related to buildings.

Ames said the county buildings "have a high probability of energy performance" improvements that will save money, while the probability of the water wheel is unknown at this point.

He said the development costs of the water wheel are an unknown, as are other aspects of the project.

He noted, however, that the Nolichucky River has enough flow to make it reasonable to consider power-generating turbines, at any number of locations downstream from the dam.

Commissioner Kevin Morrison said that, after being contacted by Mayor Broyles about this project, he talked to Greene County Director of Schools Dr. Joe Parkins about an energy survey and resulting work done several years ago by a company called Viron. Morrison said that Parkins told him that if that decision were being made today, he would not have the survey done.

Additional information on Monday's meeting will appear in Wednesday's paper.