Even before the American Revolution, settlers recognized the value of the Schoharie Valley's rich farmland, and as the land was developed, water power became necessary to run grain and lumber mills. The valley's first use of water power dated to the construction of a grist mill near Middleburgh in 1718. Construction of the Blenheim-Gilboa Pumped Storage Power Project began in 1969, and the plant began operation in 1973. Its two reservoirs, one atop Brown Mountain and the other at its foot, each hold five billion gallons of water. When power is generated, water cascades down a concrete shaft five times taller than Niagara Falls; when water is being stored, usually at night or over the weekend, the process is reversed and water is pumped back up the shaft for storage. This system lets the power plant respond to daily highs and lows in statewide electricity demand by generating power when it is needed, generally in the late afternoon or early evening, and storing the water when it is not needed. The electricity used to return water to the upper reservoir comes from inexpensive surplus power available during low-demand periods, and its cost is lower than the electricity the project replaces the following day during peak-demand periods.