Can Modular Pumped Storage Hydro (PSH) be Economically Feasible in the United Sates?

Author: Boualem Hadjerioua, Norm Bishop, Patrick O'Connor, Rocío Uría-Martínez, Scott DeNeale
Conference: HydroVision International 2014
Date: July 22-25, 2014

To date, the vast majority of global and domestic Pumped Storage Hydro (PSH) development has focused on the construction of large (generally greater than 300MW), site-customized plants. The viability of alternative design paradigms for PSH technologies has been actively discussed in industry and the research community, but no reliable determinations on the viability of these concepts have been made. Of particular interest is the development of smaller, distributed PSH systems incorporating elements of modular design to drive down cost and increase the ease of implementation. Small modular PSH could present a significant avenue to cost-competitiveness through direct cost reductions (requiring R&D) and by avoiding many of the major barriers facing large conventional designs such as access to capital, the long, uncertain licensing process, and the suppression of market prices (and subsequently revenues) caused by adding utility-scale storage to grid. These distributed modular units would typically serve large commercial and industrial loads in regions with adequate topography; examples include large industrial facilities, national laboratories, and data centers.

However, the cost and design dynamics of this new form of PSH development are not known, and it is ultimately unclear whether the benefits of modularization are sufficient to outweigh the economies of scale inherent in utility scale development, or prove superior to alternative distributed-storage technologies (i.e. batteries). This research fills portions of this knowledge gap by evaluating the technical feasibility and economic viability of modularizing the design of PSH. Determining feasibility involves both an evaluation of the technology strategies for modularization, and the market realities facing alternative PSH designs, including the size, geography, and power market distribution of potential locations, and the production economies of scale necessary to reach economic viability.

Equipment vendor expertise is utilized to evaluate modularized implementations of PSH components and subsystems to address technical viability. Various configurations and their cost-performance tradeoffs will be explored, including standardized reversible Francis units, as well as “off-the-shelf” applications of industrial pumps. Additional future research will attempt to address civil works cost reductions, including the application of alternative materials (e.g., carbon fiber) to the penstock and manufactured reservoirs.

To systematically explore the cost-performance tradeoffs of modularization, the initial analysis, reported in this paper, focuses on a reference case for the potential development of small modular PSH at an abandoned coal mine, with existing upper and lower reservoirs, operating as a closed loop. A subsequent analysis is planned to evaluate and revise a reconnaissance study (HDR 2011a) for the potential development of a m-PSH project to balance Oak Ridge National Laboratory’s (ORNL) operational and supercomputing loads (peak of 25 MW, variability of 10+ MW). Analysis support from the Tennessee Valley Authority (TVA) and direct access to the “owner’s” (i.e. ORNL’s) site, power needs, and finances will provide a unique opportunity for the holistic evaluation of all customer and grid operator portfolio benefits from such a facility.