Dividends and Switzerland boasts underground hydropower facility

In August, the Senate and House passed a bill to fight climate change and one of the many features will be ideas to generate more green energy. There will be plenty of ideas proposed and some of them will be financed, but the ones that are financed hopefully will enhance existing systems in the environment. An example is in Switzerland.

In an article by Denis Balibouse of Reuters, if you think about Switzerland one of the images you could have is the Swiss Alps or Mountains. In the canton (county) of Valais, a new underground hydro plant came on line with costs in the area of $2.9 billion.

The 6 turbines are in a cavern 600 meters below ground between 2 existing reservoirs – Emosson and Vieux and has a capacity of 900 megawatts. During peak demand, Nant de Drance produces electricity from hydropower. But when output from sources exceed demand, the plant stores surplus electricity by pumping water into the higher Vieux Emosson reservoir. Alain Sauthier, a director at the facility said the yield is very good or 80% efficiency. It takes about 5 minutes to switch from full pumping mode to full power generation.

Linking to dividend paying stocks, typically hydro utilities are a wonderful dividend stocks because after the initial capital investment to build the facility, only some maintenance is required and the rest of the time electricity is generated to be sold into the grid. Hydro dams have a long life cycle, think about the Hoover Dam in Nevada. The issue on the new Climate government money is there will be more proposals than are financially feasible and doable, saying no is a good thing to hear.

There are more questions than answers, till the next time – to raising questions.


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