Pumped for pumped hydro projects?

It’s widely accepted that pumped Hydro-electric Energy Storage (PHES) has a key role to play in Australia’s energy future. The challenge is to engage the right projects across Australia; success in this regard could more than triple the nation’s electricity storage capacity.

Recent developments such as the Australia Government’s $1.4 billion expansion plans for the Snowy 2.0, the Kidston Pumped Hydro Energy Storage project (awaiting financial close) and recent work on many proposed developments, provide lessons in determining a project’s technical and commercial feasibility.

Delays in commitments and debate around viability highlight a key issue: Australia’s energy market is based on the sale of energy, with no parallel capacity market. PHES is primarily a capacity facility: you sell the ability to provide power on demand when required. As the evening peak comes to dominate, capacity that can rapidly ramp up to meet the load as solar outputs decline is necessary if our dependence on gas and coal is to be progressively replaced. This means that unless the market is reformed to explicitly pay for capacity, the meagre generating hours need to be valuable enough to pay for a return on capital invested.

Therefore, we need the lowest cost projects that can meet the most valuable period of the daily demand curve, typically only 4-6 hours per day in the evening, with seasonal demand for 1-2 hours per day in the morning. It means that only the best of the best PHES projects should be progressed.

So what does a great PHES look like?

GHD uses what we call a ‘fatal flaw’ process, a screening process to identify factors that should halt the project at concept stage before significant funds are committed. For conventional hydro, the naturally occurring river morphology and hydrology dictate the yield and an optimal project can readily be determined. However PHES is somewhat indeterminate: a wide range of potential solutions are available, in terms of MWh capacity MW rating and elevation difference between upper and lower reservoirs, even in the volume of each. The best projects are those that may not be optimal, but are at least credible (technically) and viable (financially), while being free of fatal flaws

Five fatal flaws

GHD focuses on five areas to identify potential flaws – network, geology, hydrology, topography and regulatory.

Network

Network refers to both the physical market – the hours per day and level of demand that is valuable, as well as the physical assets. PHES can assist the Australian Electricity Market Operator (AEMO) in efforts to maintain a reliable and stable network. PHES can readily deliver valuable FCAS (frequency control and ancillary services) capability. This is in contrast to variable renewable energy (VRE), which is onerous in its demands on the network due to challenges and lack of operating experience in providing adequate voltage, frequency regulation and fault protection.

PHES is therefore a facilitator for VRE, but must provide this facility in regions on the network where it reduces, rather than increases, surplus energy or demand constraints. These would otherwise require large investments in augmenting the network, with significant new transmission infrastructure, adding to the already high cost base driving high power bills.

So in this context, a strong network component for a proposed PHES project would mean it’s the right size for the market, it has good proximity to existing transmission lines or substations and it has positive FCAS attributes as far as the AEMO is concerned.

Geology

Geology can be a challenging consideration for any project due to the uncertainty it introduces. Further, deep boreholes and seismic investigations are expensive and intrusive. Many PHES will require underground caverns and tunnels to best utilise topography, which means expert knowledge is required for their design. Highly variable geology with faulting, igneous overlays and mineralisation, present risk and cost to quantify and overcome. An incompetent response to geology will likely translate to expensive structures that are expensive to remediate, as well as increased safety concerns during construction. Australia has extensive, highly-active seismic regions, adding to the potential cost of structures. Deep weathering can lead to expensive excavation to reach competent rock, while on slopes, it can lead to expensive and extensive anchoring requirements.

The best sites for PHES will be in stable, competent geological structures of relatively high strength, free from coal measures and mineralisation.

Hydrology

Australia is the driest continent on earth, which limits our development of conventional hydro projects, but is not a serious concern for PHES since water is re-used in each cycle. Regardless, hydrology can be a cause for concern in two regards: initial fill and design for floods. Limits in the offtake of water can lead to unacceptable project delays, or expensive workarounds. Existing reservoirs can bring with them extant limitations on water availability and operating levels, as well as strict flood design criteria that could burden a potential PHES with additional costs and complexity. Any construction of hydro structures will need to consider and address the potential for flooding during construction and operations.

The best sites will have adequate water supply for filling during construction and for compensating water losses through seepage and evaporation, but without the impost of significant design work for potential floods, or any population at risk below proposed reservoirs. Ideal siting would avoid regions with very high evaporation characteristics, and instead, enhance the quantities of any water stored.

Topography

Topography is often cited as a reason why PHES is not suited to the flat expanses of Australia. This is largely a misplaced concern. For example, the 240MW Lewiston PHES near Niagara Falls utilises a 23 meter elevation difference between the man-made upper pond and one of the Great Lakes. The key consideration here is that the proposed areas for pondages are close enough together to minimise waterway lengths, and flat enough to impound the required storage without excessively large dams. Access needs to be engineered without the need for costly cut slopes or fill. As the Australian National University Study,demonstrated1, Australia has a plethora of suitable sites, so site selection should not be difficult. There are few excuses for poor site choice!

Regulatory

PHES schemes, like other infrastructure, needs to meet community expectations in respect to impact on the natural and built environment. This extends to the provision of enhancements to amenity, the protection of habitats, the meeting of local and international conventions on the protection of endangered species and the rights of Indigenous people. Protecting our national parks and protected areas from is essential. The best sites will be a positive asset in all these regards.

GHD’s fatal flaw process explores all these key aspects of PHES project design at the earliest stage. The process qualifies the best sites for further investigation and development, with credible and viable concept designs that clearly demonstrate the best in engineering innovation and coherence of thought.