North American Pumped Storage Appeals to Energy Conscious Users

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Researched by Industrial Info Resources (Sugar Land, Texas)--Industrial Info is tracking more than 23,000 megawatts (MW) of capacity and more than $40 billion in grassroot pumped storage capital projects in North America. Pumped storage hydroelectric capacity growth is attractive primarily because it can be used to balance intermittent renewable resources, such as wind and solar power, and provide peak load power generation. Reversible turbine/generator assemblies act as pumps and turbines (usually with a Francis Turbine design) to move water from higher to lower water sources.

Hydroelectric pumped storage generation uses an upper and lower reservoir, filling the upper reservoir at off-peak electricity rates, typically at a much lower cost, and then generating power during the costlier peak times to make the project financially feasible. The cost difference averages are pumped storage recovers about 75% of the energy consumed, and is the most cost-effective form of mass power storage. Pumped storage hydroelectric systems have high dispatchability, meaning they can be brought online very quickly, typically within 15 seconds, which makes these systems very efficient at soaking up variability in electrical demand from consumers. Generally speaking, energy storage is economical when the marginal cost of electricity varies more than the costs of storing and retrieving the energy plus the price of energy lost in the process. For instance, assume a pumped storage reservoir can pump to its upper reservoir water equivalent to 1,200 megawatt-hours (MWh) during the night, for $15 per MWh, at a total cost of $18,000. The next day, all of the stored energy can be sold at the peak hours for $40 per MWh--but from the 1,200 MWh pumped, 50 were lost due to evaporation and seeping in the reservoir. 1,150 MWh are sold for $46,000, for a final profit of $28,000.

Last year, the governors of Oregon, Idaho, Washington and Montana sent a letter to Energy Secretary Steven Chu voicing support for a study of pumped storage hydroelectric sites in the region. The letter asks Chu to approve the Bonneville Power Administration's request for more funding to study possible pumped storage projects in the region to offset renewable energy sources, which tend to be intermittent and for grid support.

Currently, more than 127,000 MW of pumped storage capacity is operational worldwide. In addition, the pumped storage market is expected to grow 60% over the next four years, to more than 203,000 MW.

The largest pumped storage project being followed by Industrial Info in North America is the Eagle Mountain Pumped Storage Project, which is near Eagle Mountain, California, and consists of four 325-MW reversible hydroelectric generators for a total output of 1,300 MW. This project is being developed by Eagle Crest Energy Company of Palm Desert, California. This project will consist of upper and lower reservoirs and an underground power house, and has a commercial operation date of mid-2016.

Pumped storage facilities offer the most effective opportunity for large-scale energy storage, in terms of both cost and environmental impact.

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Industrial Info Resources (IIR) is the leading provider of global market intelligence specializing in the industrial process, heavy manufacturing and energy related markets. For more than 26 years, Industrial Info has provided plant and project spending opportunity databases, market forecasts, high resolution maps, and daily industry news.