Recent years have seen energy storage installations dominated by lithium-ion battery technology around the world. But pumped hydro, for decades the only utility-scale storage asset available, and still the leader with 95 percent of storage’s global capacity, isn’t giving up just yet.
This week, the International Hydropower Association and the U.S. Department of Energy announced an alliance of 11 national governments and more than 60 organizations to speed up the development and deployment of pumped hydro projects around the world.
Such projects typically involve multimillion-dollar budgets and years of work, and in many markets permitting is getting harder because of a lack of suitable locations.
Because of this, “It isn’t easy to build new projects,” said Alejandro Moreno, director of hydropower and marine energy at U.S. Department of Energy, at a Tuesday event launching the alliance.
Another reason why pumped storage installations have stalled is that the business model that has sustained projects until now is being weakened by changing market dynamics.
In Switzerland, for example, pumped hydro plants used to make money by storing cheap nighttime electricity inflows from French nuclear power plants that could then be sold to other neighboring countries, such as Germany, to meet daytime peaks.
Nowadays, though, Germany’s grid is often flooded with wind or solar energy, wiping out demand for Swiss pumped hydro capacity.
As a result, “New pumped storage is not a commercial proposition today,” said Benoit Revaz, state secretary and director of the Swiss Federal Office of Energy.
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