rss
13

600MW pumped hydro project proposed for northern NSW

Print Friendly

Screen Shot 2017-10-11 at 11.23.16 AM

A $1 billion, 600MW pumped hydro project is being proposed on private land in northern New South Wales, in yet another example of the extraordinary interest in storage technologies as the share of low-cost renewables increases across Australia.

A company called Oven Mountain Pumped Storage is proposing the facility – which will have round six hours of storage – on the mountain of the same name between Armidale and Kempsey – in the electorate of deputy prime minister Barnaby Joyce.

The idea is to take advantage of two naturally occurring granite basins, separated by more than 600m in height and some 2.5 km in distance, and run a closed-loop, off-river pumped hydro plant that could help balance the output of renewables and meet peak demand requirements.

Oven Mountain was first assessed by engineers and consultants more than two decades ago, but the option of the project has since been taken up by a group of experienced renewable energy developers comprising Anthony Melov, Jeremy Moon and Brian Hall.

It is being looked at again amid the boom in renewable energy projects in the area, as the local transmission network considers a nearby renewable energy hub, and as market operators look increasingly to storage for grid management and security.

“The original business model was to couple it with coal-fired generation, but now it is more of a renewables play,” says Melov.

The news comes as a new report from RepuTex suggests that pumped hydro is likely to displace expensive gas as the technology to provide dispatchable flexibility to the NEM.

“Pumped hydro could serve as a lower cost substitute for gas, while complementing future low-cost renewable energy with greater dispatchable capacity, rather displacing new investment,” it says in the report.

OMPS’s Melov says his facility will look beyond the traditional business case of arbitrage for pumped hydro to a variety of service offerings including traditional derivatives such as “caps” – acting as a form of hedging tool for utilities – as well as least-cost firming products and ancillary services as these markets deepen.

Oven Mountain drilling core sample.

Oven Mountain drilling core sample.

“We believe that the Oven Mountain Pumped Storage project can add value for a wide range of customers including traditional wholesale energy purchasers and renewable energy project owners,” Melov says.

The straight arbitrage model – where a pumped hydro plant would “buy low” and pump water up hill and then “sell high” by generating power by allowing it to run downhill and through the turbines – improves with increasing market volatility, but the project will offer more than that.

“We think this project is pretty well positioned to help fill in the void left by retirement of coal generation, he says. Noting that retirements will not end with Liddell, but this project could be ready around 2022/23.

The region of New England, in Joyce’s electorate, is undergoing something of an investment boom. The White Rocks wind project, and the White Rock solar farm are both near completion, while the Sapphire wind farm is also being built, and its backers have plans for a major solar project and battery storage facility too.

Pumped hydro projects are emerging across the country. Apart from the big-ticket Snowy 2.0 and Tassie 2.0 proposals, there is the Cultana sea-water storage proposal in South Australia, and another proposal by the new owner of the Whyalla steel works to use a decommissioned iron ore mine.

In north Queensland, Genex plans to combine solar and pumped hydro in a former gold mine in Queensland, and there are a myriad of smaller projects, such as the one to re-start the Wilson River pumped hydro unit near the town of Mullumbimby.

A recent ANU study identified more than 22,000 possible sites for pumped hydro across Australia, easily providing enough capacity to take the country to 100 per cent renewables.

“It should not be viewed as an alternative to Snowy Hydro, or to Genex, or other projects,” Melov says. “It will complement and add to what others are doing.”

Discussions are being held with networks, transmission, local planning authorities and the water authorities. The company is about to launch a full feasibility study, in the same way that Snowy 2.0 is now doing.  

Share this:

  • DJR96

    Given the 5-6 year build time, it would be struggle to come in any cheaper than battery storage by then. Good luck to them though.

    • Mal Goon Chew

      Not when you consider the lifespan of batteries would be somewhere less than 20 years, depending on the technology, and pumped hydro would be 50 years or more.

      • DJR96

        That would seem to be true. However, the efficiency difference may negate that too. And a battery/inverter system can perform other services that a simple synchronous generator can’t. So the value of that flexibility isn’t factored in.

      • Ren Stimpy

        To extend the battery life from 20 years to 50 years, add 10% to the cost projection, because at the rate battery prices are falling, in 20 years time a full replacement will likely be at 10% of today’s cost. The replacement batteries will last for 30 years instead of 20 years. The concrete foundations, grid connection and other site infrastructure will be there already, only the modules need to be swapped out.

        Heck in 20 years time several million homes and businesses will have powerwalls so there might not even be any further requirement for grid scale batteries.

  • Malcolm M

    The business plan of the Oven Mountain promoters would surely be to have an shovel-ready proposal in perhaps 5 years time with all approvals in place, for completion in perhaps 8-10 years, by which time solar power would be much cheaper and coal power a lot more expensive. If new renewable projects need to be matched with new firming capacity (in a ratio developed by AEMO), this proposal would be one of the few that would be shovel-ready.

    • Mike Shackleton

      “The idea is to take advantage of two naturally occurring granite basins, separated by over 600m in height and some 2.5 km in distance, and run a closed-loop, off-river pumped hydro plant that could help balance the output of renewables and meet peak demand requirements.”

      Sounds like it could be achieved pretty quickly. The storages already exist – it would be matter of right sizing the mechanicals.

    • Joe

      ‘The Shovel Ready’ ….will be Bananabee Joyce with that now well used ‘first sodding shovel’ of his, get the cameras and media for a picture to show Australia how in love with RE is our Bananabee.

  • Chris Drongers

    The inclusion of products well beyond arbitraging high/low demand time electricity and FCAS to include financial services is interesting.

    It shows a project looking ahead to when pumped hydro is just one normal part of a power grid and is a player in the normal financial markets that underlie (non-nationalised) power supply. The emergence of financial services signifies the beginning of the transformation of intermittent renewable energy from a technological experiment to just another, soon-to-be vanilla industry.

    Inclusion of financial services is the start of a Gordon Gekko-type driving down of system costs to gain market advantage.

    • Ian

      I’m just waiting for the LNP to open up the market to something akin to CFDs. I wouldn’t put it past them.

      • Chris Drongers

        I want CFDs, and every other way that any significant industry gets money!

        Backing of renewables by serious private money will get the industry heavy lobby firepower as the owners of that money want at least a level playing field with fossil fuels.

        Fossils will hit back and very quickly the argument will become one based on evidence-based court room decisions. Politics will be a much less important player.

        On the other hand, a renewable power industry absorbing many billions $$$ of superannuation, investment bank money will be in a race to the bottom of development cost and underbidding each other to sell their zero marginal cost output. Solar and wind plants being built on a merchant basis will have to have some big hedges out there.

  • Tom

    Awesome!

  • Tom

    (different Tom)

    I hate to be a party pooper, but $1 billion for 3.6 GWh?!

    That’s $280/kWh – more than a bunch of Powerpack batteries – although I concede the pumped hydro scheme would probably last longer than Powerpacks.

    Still, it makes Snowy 2.0 look pretty cheap for at least 350GWh (although I suspect that $3 billion is “dreaming” given that Tantangara and Talbango are 30km apart).

    • Chris Jones

      Looking at the site, there’s some massive potential there for far more than 3.6 GWh… Pumped hydro becomes cost effective with scale, so go big or go batteries.