South Bend company gets OK to produce hydroelectricity by Goshen powerhouse

Falling Waters will use Mill Race Canal to produce hydro power.

Posted on Feb. 12, 2014 at 5:05 p.m.

GOSHEN -- The Mill Race Canal may once again provide a source of energy within the next few years after a decision by the redevelopment commission Tuesday, Feb. 11.

After more than a year of negotiations, the commission and Falling Waters LLC agreed to the terms of a lease that will allow the South Bend-based company to generate hydroelectricity on the powerhouse property at the north end of the canal.

Falling Waters will not actually be using the powerhouse itself to convert the canal flow into energy. The company will install equipment on the site to accomplish that.

Though the two sides have finally agreed to the terms of the lease, it will be a while before Falling Waters is ready to start producing any power.

Falling Waters must file for permits, have them approved and complete construction, which will likely take several years.

The life of the agreement is until 2029, but city attorney Larry Barkes said there are several options to extend the contract if both sides are satisfied.

Falling Waters will pay the city $125 per month for the property until it begins selling energy to NIPSCO.

Once it begins producing power, the payment to the city will be based on 10 percent of what Falling Waters makes from its sales.

At that point, there will be a minimum payment required of at least $1,500 per quarter.

Because the project received a lukewarm response -- it passed three votes to two Tuesday -- several deadlines were built into the terms of the lease that would allow the city to nullify the agreement.

The company must file for at least some of their permits by 2016, must have some approved by 2017 and must begin construction by 2018.

If any of those deadlines are not met, the commission reserves the right to end the agreement.

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