AGL advances plan to convert Hunter Valley coal mine into huge pumped hydro facility

Energy giant AGL is talking up plans for a pumped hydro energy storage facility in a disused coal mine in the upper Hunter region as preliminary investigations into the Bells Mountain pumped hydro project indicate promising results.

In a statement released on Monday, AGL said the preliminary feasibility study into the proposed Bells Mountain pumped hydro energy storage project was nearly finished and it was preparing to progress the project to the next stage.

The proposed 250MW pumped hydro facility, with eight hours of storage, would be located at the site of the former Muswellbrook Coal Company, using a disused “void” at the site, just 15km north of AGL’s existing Bayswater and Liddell power stations.

The project would store water in the disused mine void, which could then be pumped to a second reservoir at a higher altitude to store potential energy. This water could be subsequently released under gravity and used to convert the potential energy back into electricity on demand.

The pumped hydro facility would provide around 8 hours of dispatchable supply, or around 2,000MWh of stored energy, with an estimated development cost of $450 million, and forms part of AGL’s plan to pivot into lower emissions sources of electricity generation.

AGL Energy’s chief operating officer Markus Brokhof said the project was “potentially beneficial” to the local community as well as playing a positive role in Australia’s energy transition.

“As we transition to more renewable energy sources, pumped hydro provides a reliable on-demand generation source,” Brokhof said. “We have worked closely with Muswellbrook Shire Council throughout this study and I’d like to thank them for their role in identifying the option.

“This study is part of our commitment to deliver a mix of technologies to the energy system and aligns with our Climate Statement and target of net-zero emissions by 2050.”

The preliminary study sought to confirm that the project would be technically feasible, as well as providing an indicative estimate of the cost of the project.

Last month, AGL announced that it was considering splitting its business into two, carving out its fleet of fossil fuel power stations into a separate entity, allowing the core AGL brand to focus on low emissions sources of power and its retail business.

The Bells Mountain pumped hydro project has been in the works for some time, with AGL Energy signing a memorandum of understanding with the Australian subsidiary of Japanese based coal company Idemitsu Australia Resources in 2019 to develop the Muswellbrook site into the pumped hydro facility.

Chief commercial officer of Idemitsu Australia Resources, Chris Walsh, said that the findings of the preliminary feasibility study were understood be promising and that the company was looking for further opportunities to expand its investments in renewable energy developments. Idemitsu’s Japanese parent company is one of that country’s largest petroleum refiners.

The company established the Idemitsu Renewable Development Australia (IRDA) subsidiary to similarly drive the company’s expansion into cleaner energy sources.

“We have established IRDA which will leverage our global expertise from our parent company Idemitsu Kosan to ensure we can continue to contribute to regional communities like Muswellbrook where mining commenced some 113 years ago,” Walsh said.

“Innovative rehabilitation solutions such as the reuse of mine voids as proposed with the Bells Mountain pumped hydro project ensure that sites like Muswellbrook can continue to generate investment and long-term employment.”

The companies said that following positive results from the preliminary feasibility study, the venture would progress to a ‘full’ feasibility study, including undertaking detailed design work, geotechnical drilling, engaging contractors and securing necessary environmental approvals.

AGL and Idemitsu are aiming to have the project up and running by 2027.