VALLECITO – A hydroelectric plant below Vallecito Dam has served as a modest but steady source of renewable energy since the late 1980s.
Now, 40 years since its inception, it has come under local ownership for the first time.
Ptarmigan Resources & Energy, a Durango-based company, recently purchased the plant from Aspen-based Wally Obermeyer, the project’s original developer.
The move places the plant in the hands of a local owner – just miles from its turbines – as La Plata Electric Association prepares to exit its contract with Tri-State Generation and Transmission next spring.
The exit allows LPEA to buy power directly from providers, expanding and diversifying energy sources. One of LPEA’s first steps was signing a 10-year power purchase agreement with Ptarmigan.
“That’s exciting to have it under local management and then to be selling it to the local co-op at a discount,” said Ptarmigan CEO Sam Perry.
Almost two years ago, Obermeyer received a cancer diagnosis and reached out to Perry to discuss a possible transfer of ownership.
The transition follows years of planning, including Perry’s careful negotiation of a short-term contract with Tri-State that will expire on the same day LPEA completes its long-planned buyout.
Perry, who has closely followed the co-op’s push for independence, said the timing couldn’t be better.
“Cutting out the middleman is an incredible win-win for both La Plata Electric and us,” he said.
Now, Perry can charge more while the co-op pays less.
Local ownership also means quicker response times and greater flexibility in meeting the region’s evolving energy needs.
“With LPEA moving away from coal and Tri-State as their primary power source, there’s a lot of opportunity for new infrastructure, and we hope to play a key role in that transition,” he said.
Perry is already planning upgrades. The company is exploring the possibility of building an on-site battery storage facility – using existing grid connections to store excess power and help LPEA manage demand fluctuations throughout the day and year.
“We generate a lot in the summer, when irrigation demand is high, but not much in the winter,” he said. “With storage, we can get more value out of the system and help LPEA as it builds a more flexible, modern grid.”
The changes come amid major shifts in Colorado’s energy economy. LPEA’s exit from Tri-State’s restrictive all-requirements contract allows the co-op to choose where its power comes from – and at what cost.
For Perry, who has worked on hydro projects across the West, having a facility in his backyard feels like a rare opportunity.
Vallecito Dam was built in 1941 for flood control and irrigation. Power generation came decades later when Obermeyer, an early small-scale hydro advocate, developed the plant in the late 1980s.
The project was part of what Perry called the “purple boom” – a brief period when federal tax incentives made hydro development financially viable.
Using a 10-foot-diameter pipeline, the plant diverts water from the reservoir to a turbine more than 100 feet below. The pressure differential spins a shaft that powers a generator and sends electricity to the grid.
At peak output, it can produce up to 5.8 megawatts – enough to power about 2,500 homes annually.
Though small, the Vallecito plant provides a type of power the grid increasingly depends on.
“Hydropower is probably the only renewable energy resource that runs consistently through the day,” Perry said.
Unlike solar, which peaks midday and depends on clear skies, hydro runs around the clock.
“As peak demand grows in the evening and the grid becomes saturated with power during the day, hydro is going to play a bigger and bigger role in kind of stabilizing the grid,” he said.
Hydropower provides grid stability services by helping regulate voltage and frequency. The physical mass of the plant’s turbines act like a giant flywheel, smoothing out fluctuations.
It also requires fewer resources than other forms of power.
The engineering and equipment responsible for generating power are simple and don’t need frequent replacement, said Mike Canterbury, dam manager for Pine River Irrigation District.
The current equipment has been in use since its original installation in the 1980s.
It also requires minimal staffing. Most day-to-day operations are automated. Canterbury oversees the plant, and when he’s on break, PRID Superintendent Ken Burke steps in.
Additionally, the plant provides some logistic security for PRID, the district that manages the reservoir and the dam.
In the next several years, a complete renovation project must be done on the spillway, Burke said.
The plant also supports local agriculture.
While its primary role is power generation, the facility shares infrastructure with the Pine River Irrigation District, which operates the dam and controls water releases from Vallecito Reservoir.
Perry said the hydro plant allows irrigators to continue receiving water without relying on the spillway.
Even as Southwest Colorado faces more frequent drought and reduced snowpack, Burke, Canterbury and Perry remain optimistic about the plant’s future.
“This year, it’s like divine deliverance,” Burke said. “I couldn’t state it any better than that.”
Despite a dry winter, the reservoir is full, and water is flowing at optimal levels – feeding farms and powering the grid all at once.
jbowman@durangoherald.com
