NSW backs new pumped hydro project promising 12 hours of storage

A pumped hydro project that promises to provide 800MW of capacity and long duration energy storage of up to 12 hours in the New South Wales Central-West Orana renewable energy zone has been given a funding boost from the state government.

The Phoenix Pumped Hydro Project, located 35km west of Mudgee, has been awarded $7 million by the Perrottet Coalition government to progress feasibility studies.

The ACEN Australia project was selected for the funding by state-owned EnergyCo and WaterNSW, following a competitive selection process.

The money will be used to determine if the pumped hydro project can be used to help replace retiring coal-fired generation capacity in the state by providing long-duration energy storage and firming services for renewables.

The government funding comes from the NSW Pumped Hydro Recoverable Grants Program, which in September awarded just under $50 million to five proposed pumped hydro projects promising a combined energy storage capacity of up to 60 hours.

The grants program aims to help pumped hydro developers to cover upfront costs and encourage investment from the private sector to back the state’s target of at least 2GW of new long duration storage by 2030 – and to replace its coal fleet in the shift to renewables.

NSW energy minister Matt Kean says the Phoenix Pumped Hydro project, which will have the capacity to power 40,000 households, could join other PHES projects in the state to act like a giant battery for the electricity grid.

“It works by using surplus renewable energy to pump water up a hill when it is sunny and windy, and releasing the water back down the hill through giant turbines that create electricity when it is still and dark,” Mr Kean said.

“Bringing the grant funding and development access together will play a key role in fast-tracking the development of pumped hydro, which will be critical to replace our ageing coal fire power stations.”

Proposed for development on both private land and land owned by WaterNSW, Phoenix pumped hydro project is expected to be operational by 2030.

It sits in the Central-West Orana REZ, based around Dubbo and Dunedoo on the lands of the Wiradjuri, Wailwan and Kamilaroi people – the focus of the state’s first competitive tender, in October of this year.

A registration of interest process attracted 113 submissions in June of 2020, representing 27GW of new generation and storage projects.

ACEN Australia CEO Anton Rohner says the Phoenix Pumped Hydro Project has the potential to facilitate
more renewable projects in the Central-West Orana region and provide valuable firming services in NSW.

He says the project will be bidding for Long-Term Energy Services Agreements for long-duration storage under the Electricity Infrastructure Investment Safeguard.

“Our focus is on ensuring that we develop a project that offers the right mix of benefits and opportunities for the region and the state,” Rohner says.

“We’ll be calling for inputs from community and stakeholders soon to help shape the project.”