Pumped-storage hydropower plants: An attractive market opportunity

Pumped-storage hydropower plants: An attractive market opportunity

By Emanuele Quaranta

Pumped-storage hydropower plants (PSHPs) are spreading worldwide and are at the center of engineering goals. PSHPs can act both as an energy supply and storage to stabilize the electrical grid, depending on the energy demand. They can allow the further spread of wind and solar power plants, which are the renewable-based power plants most responsible for the variability of electricity delivered to the grid. Finally, considering the trend of energy prices during the day, PSHPs are also considered an attractive solution for new market opportunities worldwide.

Advantages and drawbacks of renewable resources:

The operation of wind and solar plants depends on atmospheric conditions, which cannot be managed by human control. Wind and solar sources exhibit the highest variability in time and their production can be predicted, but with great difficulty. Instead, hydropower plant operations are more flexible, since hydropower output can be easily managed. More than 50% of renewable energy is generated by hydropower plants.

In the last decades, due to the spreading of wind and solar plants and the diversification of human activities, there is frequently a surplus of energy delivered to the grid. This surplus of electricity has to be stored or intentionally wasted in order to not destabilize the electrical grid. The best solution to deal with this problem is represented by using pumped-storage hydropower plants (PSHPs), i.e. hydropower plants that can operate also in reverse to not only create energy, but also to store it.

How does a PSHP work?

PSHPs supply (generate) energy when the energy demand is higher than the energy available inside the electrical grid. In the generation mode, water passes from an upper reservoir to a lower one, driving the turbine. However, when the energy demand reduces, generating a surplus of energy in the grid, water in the lower basin is pumped into the upper one (pumping operation) using this surplus of energy. The stored water in the upper basin is again used during the period of high electricity demand for energy generation. Turbines used both for pumping and for energy generation are called PAT (“pump-as-turbine”).

Installation of a pump-turbine. Photo courtesy of Voith GmbH & Co. KGaA

From statistics in 2012, the countries with the most PSHPs are the United States, Japan, China, and Italy. The largest PSHP is in the USA, with a power capacity of 3 GW. In China, the construction of the Fengning plant is now in progress. It will be equipped with 12 pump-turbine units of 300-MW each, for a total capacity of 3.6 GW . They will be housed in an underground cavern. It will be completed in 2021 and it will be the world’s largest PSHP. In China, other two plants are also under construction, with a total capacity of 3 GW. By the year 2020, Japan will construct a plant of 2.8 GW and Ukraine a plant of 2.3 GW.

The future of PSHPs and market opportunities:

The development of PSHPs will contribute to the development of solar and wind power plants, while stabilizing the electrical grid. Furthermore, PSHPs operate in a closed cycle, mostly employing the same amount of water, hence minimizing the removal of water from rivers. PSHPs have driven a new market opportunity: water is used for electricity generation during the periods of peak demand, when the energy price is the highest. Water is instead pumped to the upper reservoir (using the electricity available in the electrical grid) during the periods of low energy demand, when energy prices are lower. This closed cycle represents a big profit opportunity for the owners of PSHPs.

The development of PSHPs also poses some engineering challenges, like the performance prediction of PAT, the variable rotational speed of PAT and their optimization, and better management and control of water sources. In the future, the usage of PSHPs will become essential, assuming more wind and solar power plants will be put in operation.

Featured image shows a pumped-storage hydropower plant, with upper and lower water basins. Courtesy of Voith GmbH & Co. KGaA.

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