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ARENA backs pumped hydro project at disused Qld gold mine

Sophie Vorrath
19

The plans of NSW company Genex Power to convert an abandoned Queensland gold mine into one of Australia’s largest solar and pumped hydroelectric storage plants have received a boost from ARENA, with a contribution of $4 million towards an ongoing feasibility study into the project.

kidston storage solar

The feasibility study will explore the technical and commercial viability of constructing the proposed power plant at the disused Kidston gold mine in northern Queensland, which is estimated to cost around $282 million. A 150MW solar plant may be added to the site too, with a new proposal to build a large solar PV array to complement the pumped storage.

As we reported here in November, the use of large-scale pumped hydro to store excess electricity generation has been touted by some as a cheaper and easier alternative to batteries to complement an increasingly distributed grid, but there are few new examples of it in Australia.

Acting ARENA CEO Ian Kay said the work by Genex could reinvigorate the pumped hydro storage industry in Australia and enable more renewable energy to be used on national grids.

“This feasibility study aims to pave the way for the first new pumped hydro storage development in Australia in more than 40 years,” he said.

“Energy storage is becoming increasingly important as more renewables are connected to the Australia’s electricity grids. Pumped hydro storage can provide a cost-effective alternative to large-scale battery storage and concentrating solar thermal storage.

The Kidston mine, 270km north-west of Townsville, has the key characteristics required for a pumped storage power project, including two deep, adjacent pits.

“The original mine site has two pits 400 metres apart, with an ideal size and depth,” said Genex managing director Michael Addison. It also benefits from mine and electricity infrastructure already in place as well as existing permits.

Genex – which launched an initial public offer in June ahead of listing on the Australian Securities Exchange (ASX) in July – engaged Hydro Tasmania offshoot, Entura, to conduct the feasibility study.

“The proposed plant would take advantage of the Kidston mine’s unique characteristics and the existing infrastructure at the site, minimising its environmental footprint,” said Kay in a statement on Friday.

“The novel approach will use the former mining pits as upper and lower water storage reservoirs.

“If the case for pumped hydro storage at disused mine sites is proved, it could give abandoned mines across Australia a new lease on life. Genex has already identified nine sites with similar characteristics to Kidston that could be potential future candidates.”



The proposed plant will operate on an off-peak pumping, peak generation cycle, storing excess electricity during periods of low demand and high generation.

Genex is also exploring the use of variable speed turbines, which can effectively manage grid stability in areas with grid constraints or high levels of renewable energy generation.

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19 responses to “ARENA backs pumped hydro project at disused Qld gold mine”

  1. Tim Forcey Avatar
    Tim Forcey

    Well how about that.

    Related reading: https://theconversation.com/pumped-hydro-energy-storage-making-better-use-of-wind-18565

  2. michael Avatar
    michael

    has anyone read the prospectus? seems like a terrible project, so not overly happy to have taxpayer funds headed their way. why not let the IPO participants shoulder the PFS costs? and $4m to assist an ‘ongoing feasibility study’, wowee there’s some consultants licking there lips, that’s a very expensive PFS
    the lessening of peak pricing events through increased distributed solar actually erodes the business case

    1. Chris Drongers Avatar
      Chris Drongers

      Michael, looking at your comments on other threads you make lots of negative statements but seldom back them up with specifics. How about being specific as to what it is that you do not like about this project? $$$, inputs, outputs, policy?

      1. michael Avatar
        michael

        You mean the bit where I pointed out pfs shouldn’t cost $4m+ and the comment about peak shaving implications of solar Pv which drops peak pricing which underpins their business case?

        1. mikec Avatar
          mikec

          I thought the primary function of pumped hydro is to act like a giant battery for renewables and to provide quick reactions to Spikes in the demand? Giant storage sounds like a great answer to the usual rubbish about being intermittent Sun dont Shine, Wind dont blow etc.

          Some positive aspects for you:
          Project on a brownfield site, rehabilitating habitat.
          Resolves a storage issue confronting renewables
          Requires no toxic/carbon based fuels
          Doesn’t require another huge hole in the ground at a lithium mine to support battery storage.
          Diversification of alternative energy sources supports supply resiliancy
          A Mature, Proven technology, no R&D cost

          An uneconomic project perhaps, but a taxpayer investment in an uneconomic coal mine is “Terrible”

          1. michael Avatar
            michael

            yeah, very risky proposition delivering a project of large scale storage at edge of grid that has its business case eroded by any increase in low power price or decrease in windfall peaking… within a market with too much generation (as pointed out in this publication) and having it’s peaks removed due to correlation with strong PV generation timing (unless i’m wrong on that one) and on top of this is the fact it represents storage int he wrong spot, it has just been put there to try to come up with a use for a big hole.
            The prospectus relies on being able to sell power into markets at prices between $107-146/MWh…. is this likely? Particularly unlikely if we get large scale renewable deployment as the oversupply to the network will increase and depress pricing… or do renewables increase pricing?

          2. Chris Drongers Avatar
            Chris Drongers

            The last refuge of big coal power stations that currently run most of the east coast power system is ‘base load’. The ideal ‘base load’ doesn’t vary over the day enabling a right-sized generation system to operate of optimal efficiency. Anything that removes variation is worth more than the ‘base’ rate.
            As to high cost, carbon capture and sequestration is going nowhere without subsidies. Even the coal miners and coal burners don’t reckon it is worth putting their money into unless the government coughs as well.

  3. Tim Buckley Avatar
    Tim Buckley

    Pumped hydro storage combined with renewable energy could be a total game changer, helping deliver power when consumers want it, thereby destroying the coal-fired power generation claim that renewables cant provide baseload power. The whole fossil fuel industry’s claimed need for baseload is obsolete; the grid needs to be able to provide power when consumers need it – the grid of 2020 will be a source of backup supply, not baseload.

    1. ID635 Avatar
      ID635

      Does Australia have enough mountainous terrain and rivers to adequately supply enough hydro? Also are the ecological values of the area to be dammed of low quality? Think of the environmental impact.

      1. Tim Buckley Avatar
        Tim Buckley

        Are you a troll? Do you cowardly hide behind false names?

        1. ID635 Avatar
          ID635

          Stating facts, something that you seem unfamiliar with

  4. sunoba Avatar
    sunoba

    I’ve done a quick calculation as to the cost of storage per kWh delivered. My provisional estimate is 3.2 cents per kWh, which is pretty impressive. Details are too complicated to give here; I’ll post them at http://www.sunoba.blogspot.com as soon as I’ve written the blog post (probably over the weekend).

    1. sunoba Avatar
      sunoba

      OK, I have now finished the blog post. Lots of assumptions are required to estimate the cost of storage. Under an optimistic scenario, I get AUD 36 per MWh delivered; under less favourable assumptions I get AUD 118 per MWh delivered. The capital cost of the storage is AUD 171 per kWh. This is significantly cheaper than battery storage at present. Details at http://www.sunoba.blogspot.com.

      1. BeyondZeroEmissions Avatar
        BeyondZeroEmissions

        Thankyou sunoba.

        Also noting there are GW’s of off-river pumped hydro already installed elsewhere globally. Also noting Tim’s comment about ‘baseload’ myths – yes, analysis – not just ours – is clear that it will be modernising of the grid itself combined with renewables + various existing storage techs that will allow for the transition to reliable and good value 90-100% RE network nationally. 10-15 years is not an unreasonable timeline given Australia’s capacity. Renewables-powered ‘energy intensive’ industry migrating to Australia’s regions is then not far away. In the context of a national and global vision of that kind $4million looks like a good investment.
        http://bze.org.au/zerocarbonplan#RESP

  5. Robert Comerford Avatar
    Robert Comerford

    4 million gift to think about something that is obvious. What a scam. Just get in and do it.

  6. Smurf1976 Avatar
    Smurf1976

    Hydro by its nature is a very long term proposition. Lake Margaret (1914) and Tarraleah (1938), both in Tasmania, are two examples of old hydro stations still in full production (base load) today and neither are close to being worn out yet.

    In contrast, with coal or gas you get about 40 years before the decision is required to either invest heavily in major refurbishment or cease operating. In many cases you only get 30 years before plant reliability becomes an issue, indeed many of them were designed for 30 years full use + 10 years in a backup role used sparingly. The actual life can vary depending on circumstances but in broad terms that is the case.

    We’ve just seen the closure of Anglesea (Vic, 1969) and the remaining units at Kwinana are going too (WA, circa 1976). Meanwhile Northern (SA, 1985) is now burning through the coal stockpile (mining has ceased) prior to shutting down in a few months.

    With current market prices and the high probability of a renewed carbon price at some point, it’s just not economic to invest in coal-fired generation today. Not economic to built new and not even economic to just refurbish what you’ve already got.

    Wallerawang (NSW, 1000 MW), Munmorah (NSW, 600 MW), Redbank (NSW, 150 MW), Morwell (Vic, 190 MW). All gone and it’s only a matter of time until more close too.

    As the shift to renewables gathers pace, it’s not just a question of using less coal per se. We’re also seeing a reduction in firm generating capacity from coal. For that matter, some gas plants are closing too – eg Swanbank E (Qld, 385 MW) is mothballed, Tamar Valley CCGT (Tas, 208 MW) is about to go and so is 120 MW of OCGT capacity in Tas. Torrens Island A (SA, 480 MW) is announced for closure as well.

    Related to that is that solar PV is already losing effectiveness as a means of meeting peak demand. Already the peak is now being pushed into the late afternoon as PV output declines before the temperature drops in Summer. And in Winter, PV is absolutely useless at meeting peak load at 6:15pm.

    Add all that up and at some point price volatility goes up rather than down. We’re within sight now of a situation where future PV adds to off-peak supply but adds little to the peak. AEMO and others have already noted a scenario where in some states, notably SA and WA, we’re going to end up with PV as 100% of generation on occasion. Then the sun goes down and all that generation goes with it meanwhile demand remains or, in winter, actually goes up as PV goes down.

    So we’re going to need some sort of storage. It might not be profitable today, but at some point there’s no choice if we’re going to shift from coal and gas in favour of intermittent renewables that don’t always work when the power is actually needed.

    Pumped hydro fits pretty well with that scenario. It has a very long lifespan, is a fully developed mature technology, and is capable of very rapid adjustment of output to match supply and demand. It ticks all the boxes. That it lasts a century or more and doesn’t require toxic materials is just a bonus, albeit a potentially important one.

    Go forward just half a human lifetime to the 2050’s and we’re quite likely going to have zero coal-fired generation in the grid. Uneconomic to build or refurbish anything new and plants will have reached the point where they can’t continue without investment. Game over and that’s even if it’s still legal to burn coal (something that looks rather doubtful). Gas might still be around but with a carbon price almost certainly too costly to operate on a daily basis, being reserved for a pure backup role only (and “backup” means running 3% of the time not 30%).

    By the time we get to that situation without coal, there will be times when we’re basically running most of the supply from storage. No PV on a cold winter night. Some days it’s hot and the wind doesn’t blow. Etc. OK, wind doesn’t go to zero as such but there will certainly be times when storage is the bulk of supply.

    Using 2 holes in the ground that are already there as reservoirs for pumped hydro certainly looks like the “low hanging fruit” of storage since most of the work has already been done via an unrelated mining operation.

    1. Ian Avatar
      Ian

      Anglesea coal mine and power station would seem to fit the bill for a pumped hydro plant. A huge hole in the ground, a decommissioned power station, and readymade transmission lines.

      1. Malcolm M Avatar
        Malcolm M

        Firstly the Anglesea mine is not deep, so there would not be a good head, leading to a lower efficiency. Secondly Victoria would be near-last in priority as a State suited to pumped storage. This is because Hydro Tasmania have a long-term plan to build additional capacity across Bass Strait so there is a total of 1000 MW. (Anglesea would be a good “landing point” for a second set of Bass Strait cables.) This way, the Tasmanian hydro would complement renewables in Vic, negating the need for pumped storage.

        In SA, potential mines sites for pumped storage include Iron Baron (80 m head according to Google Earth) and Iron Knob (200 m). I wonder how much more economic life these mines have ?

  7. Malcolm M Avatar
    Malcolm M

    Why would a new pumped storage be economic in the current market when a larger existing one (Wivenhoe, 500 MW) is only rarely used ? According to the Aneroid Energy website, it was only used once last October, twice in November and once so far in December. To be economic a new system would need to buy (to pump) at a low price and sell at a high price on an almost daily basis. With a price differential in Queensland from about $20/MWh form about 2 am to 6 am, to $100/MWh during daytime spikes, surely there would be enough price spread for Wivenhoe to be used almost every day, but for some reason it is not.

    In NSW, the Shoalhaven pumped storage is used quite regularly, but Tumut 3 doesn’t appear to be used in pump mode.

    It would be great to see the Kidston development go ahead, but I would first want to know why the existing pumped storage units in NSW and Qld have such low capacity factors.

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