International government-led coalition calls for urgent action on pumped storage hydropower
‘Get used to blackouts’ or risk reverting to fossil fuels is the warning, unless the world scales up investment in water batteries to support fast-growing solar and wind power.
This is the conclusion of the International Forum on Pumped Storage Hydropower, a grand coalition of 13 governments led by the U.S. Department of Energy, the International Hydropower Association (IHA) and involving more than 70 multilateral banks, research institutes, NGOs and public and private companies.
The International Forum was formed 10 months ago in November 2020 to research practical recommendations for governments and markets aimed at addressing the urgent need for green, long-duration energy storage in the clean energy transition.
A series of final reports were launched on 16 September 2021 at a high-level panel during the World Hydropower Congress. The forum was co-chaired by Malcolm Turnbull, former Australian Prime Minister, and Kelly Speakes-Backman, Acting Assistant Secretary at the U.S. Department of Energy.
Watch the launch event and panel discussion:
In its summary report, the International Forum warns that conventional batteries alone cannot provide adequate storage and grid flexibility. “What happens when the sun does not shine and the wind does not blow? These technologies need a low carbon back-up or we will fall back on fossil fuels or simply have to get used to blackouts,” the report says.
The report says that, unless governments are willing to retain power plants fired by fossil fuels, they will need to invest in the clean energy storage provided by pumped storage hydropower. “Without adequate storage there is a very real risk that electricity grids of the future will not be able to provide reliable power without recourse to high carbon sources of back-up such as gas turbines,” it says.
‘We need to plan ahead’
Mr Turnbull warned the lack of adequate long duration energy storage to support growing penetrations of solar and wind power is “the ignored crisis within the crisis”. As Prime Minister of Australia 2015-2018, he spearheaded the development of pumped storage hydropower (PSH) including the 2,000 MW Snowy 2.0 project and the Battery of the Nation initiative.
Welcoming the findings, United Nations Special Envoy on Climate Action and Finance Mark Carney said “there is a central role for pumped storage” in addressing the climate crisis. “It is the only form of large-scale duration, green energy storage in the world. It is increasingly important, complements the growth of intermittent renewables and can provide unique services that batteries cannot.
Mr Carney added: “We need to plan ahead. [Pumped hydro] is capital intensive and that underscores the importance of implementing solution orientated measures of having credible and predictable government policy to build the pumped storage we need to complement the rapid, scaling [variable] renewable energy.”
Thomas Östros, Vice President of the European Investment Bank, added: “Among storage technologies we see pumped storage hydropower as one of the most mature, reliable and versatile large-scale solutions for grid flexibility and security, promoting intermittent renewables in a cost-effective, safe and sustainable manner. In fact, pumped storage hydropower has the potential to remain the most competitive green storage solution at scale over the next decade.”
The International Forum’s reports were launched at a High-level Panel held as part of the World Hydropower Congress on 16 September 2021. The panel discussion is free to view on-demand by registering via the Virtual Attendee Hub.
• Kelly Speakes-Backman, Acting Assistant Secretary , U.S. Department of Energy
• Malcolm Turnbull, former Australian Prime Minister
• Mark Carney, UN Special Envoy on Climate Action and Finance
• Thomas Östros, Vice President, European Investment Bank
• Zheng Sheng’an, President, China Renewable Energy Engineering Institute
• Pascal Radue, CEO, GE Renewable Energy Hydro Solutions
• Yves Giraud, CEO, EDF Hydro
• Uwe Wehnhardt, CEO, Voith Hydro
The International Forum on Pumped Storage Hydropower warns that, unless governments are willing to retain power plants fired by fossil fuels, they will need to invest in the clean energy storage provided by pumped storage hydropower.
“Without adequate storage there is a very real risk that electricity grids of the future will not be able to provide reliable power without recourse to high carbon sources of back-up such as gas turbines,” the report says.
A clean, green water battery
Pumped storage hydropower (PSH), known as ‘the world’s water battery’, is an ideal complement to modern clean energy systems, as it can accommodate for the intermittency and seasonality of variable renewables such as wind and solar power.
According to a major new IHA report, Hydropower 2050: Identifying the next 850+ GW towards 2050, pumped storage installed capacity is set to more double in the coming years, however this remains well short of the energy storage requirements of electricity grids increasingly reliant on solar and wind power for generation.
By the end of 2020, there was 160 GW of pumped storage hydropower installed globally, comprising 95 per cent of all total installed energy storage.
China has been responsible for most of the recent growth in pumped hydropower storage in recent years and earlier this month announced plans to double national capacity to 120 GW by 2030, a fourfold increase from 32 GW today in less than ten years.
In the USA, the Biden Administration’s American Jobs Plan calls for new investments in pumped storage hydropower, with tax credits and a new clean electricity standard to incentivise development.
In Europe, the European Commission’s new Taxonomy on Sustainable Finance recognised pumped storage hydropower as making a substantial contribution to climate change mitigation.
Seven major policy recommendations
The International Forum puts forward 7 major recommendations for governments around the world to avert the risk of policy-makers and grid operators falling back on fossil fuels to provide clean energy storage:
- Assess long-term storage needs now, so that the most efficient options, which may take longer to build, are not lost.
- Ensure consistent, technology neutral comparisons between energy storage and flexibility options.
- Remunerate providers of essential electricity grid, storage, and flexibility services.
- Licensing and permitting should take advantage of internationally recognised sustainability tools.
- Ensure long-term revenue visibility with risk sharing to deliver the lowest overall cost to society.
- Assess and map for pumped storage hydropower among potential existing hydropower assets and prospective sites.
- Support and incentivise pumped storage hydropower in green recovery programmes and green finance mechanisms.
Download the reports
The full reports from each of the International Forum’s working groups are available online at hydropower.org/pumped-storage-forum. These include:
Yves Giraud, CEO of EDF Hydro said: “Pumped storage hydropower projects should be better acknowledged for all the services they bring to the electric system - flexibility, ancillary services needed to develop variable renewable energies, such as wind and solar. In my opinion, in Europe and many countries worldwide, there should be a new market design to integrate storage facilities. Pumped storage hydro is highly valuable and a key enabler of energy transition, we have all the tools to develop it in a sustainable way, so that it could play this major and vital role in decarbonisation of electricity.”
Pascal Radue, President and CEO Hydro Solutions of GE Renewable Energy said: “We have to seize the momentum. Policy-makers should assess the long-term storage needs of their future power system now, so that the most efficient options, which may take longer to build, are not lost. Now is the time for us as an industry to demonstrate what is needed so that we can ultimately bring the necessary capacities online to contribute to the success of the energy transition.”
Uwe Wehnhardt, President and CEO of Voith Hydro said: “We need pumped storage hydropower because it helps avoid the curtailment of renewable energy and reduces reliance on thermal power plants. These facilities provide essential grid services such as rotating inertia and reactive power and provide a means to respond quickly to the risk of blackouts.”
About the Forum
The initiative brings together 13 governments – the USA, Austria, Brazil, Colombia, Estonia, Greece, India, Indonesia, Israel, Morocco, Norway, Sri Lanka and Switzerland - international financial institutions, and over 70 organisations, including leading energy companies such as including EDF, GE Renewable Energy, Voith and Hydro Tasmania.
Participating multilateral development banks include the World Bank, the European Bank for Reconstruction and Development (EBRD), the African Development Bank (AfDB), the Asian Development Bank (ADB) and the Inter-American Development Bank (IDB).
Convening three industry-led working groups, this year-long initiative will develop guidance and recommendations about how sustainable pumped storage hydropower can best support the energy transition. The International Hydropower Association (IHA) acts as the secretariat to the Forum.