Australian and French energy giants team up for pumped hydro plant to replace coal

One of Australia’s biggest utilities has teamed up with the local offshoot of French nuclear giant EDF to co-develop a large pumped hydro project that will help replace a nearby coal fired power station.

EnergyAustralia has been looking for several years to develop the Lake Lyell pumped hydro project, using the same water body that supplies the Mt Piper coal fired generator, and which is now pitched as a 385 MW, eight hour (3,080 MWh) asset.

It said it has chosen EDF – which runs France’s nuclear fleet and a series of pumped hydro plants that were built to provide back up to that technology – because of its experience with pumped hydro assets. It also has deep pockets and will take a majority stake in the venture.

“Our purpose is to lead and accelerate the clean energy transformation for all,” EnergyAustralia CEO Mark Collette said in a statement.

“We recognise pumped hydro requires unique expertise to ensure it is developed and delivered efficiently, while considering the best interests of the local community and the wider state of NSW.”

Pumped hydro has proved problematic in Australia, particularly for private industry, and is being beset by big increases in civil construction costs, which is affecting most industries. The flagship Snowy 2.0 project, funded by the government-owned Snowy Hydro, has been riddled with errors, delays and a massive blow-out in costs.

In north Queensland, the Kidston pumped hydro project is also running late, albeit by just a few months, and is more or less within budget. But it also depended almost entirely on government agency funding for the $600 million project.

NSW is desperate for long duration storage, and particularly pumped hydro to replace the coal fired power stations that are expected to exit the grid within the next decade. EnergyAustralia’s Mt Piper coal plant near Lithgow (pictured above) is expected to be the last.

But so far its tenders for long duration storage have secured only one pumped hydro project winner – the 800 MW, 15 hour (11,900 MWh) Pheonix project next to Lake Burrendong, near Mudgee, proposed by Acen Australia – with most of the winners being eight hour batteries, and the advanced compressed air storage facility near Broken Hill.

James Katsikas, the head of EDF power solutions Australia, says EDF owns and operate more than 20 gigawatts (GW) of hydroelectric assets across the globe and is developing many more.

“In Australia we are already leading the Dungowan PHES project near Tamworth, NSW, with 300 MWs and ten hours of storage that will support NSW’s energy transition,” he said.

“We will work with EnergyAustralia and all interested stakeholders to ensure that (the Lake Lyell project) becomes a model of sustainable development and a source of real pride for the region.”

EDF will hold a 75 per cent equity stake in the newly created joint venture that will develop the project, and the two companies are targeting a final investment decision in late 2026. They hope to produce its Environmental Impact Statement submission in 2025, with Final Investment Decision targeted for late 2026. 

EnergyAustralia is also developing a major utility scale battery at the Mt Piper site, and says it has has invested hundreds of millions of dollars into its Mt Piper coal plant, with a focus on boosting flexibility as the growth of wind and solar forces it to evolve from an “always on” baseload supplier.

Want the latest clean energy news delivered straight to your inbox? Subscribe to our free daily newsletter.