The following story is great news for renewable energy and a kick in the but for fossil fuels. This seems to be an opposite trend to which the USA is heading at the moment. This is in addition to the 100MW battery storage planned by two states.
The story is an extract from an article at renew-economy by By Giles Parkinson on 16 March 2017
Prime minister Malcolm Turnbull has announced his desire to spend $2 billion on a 2GW pumped hydro scheme in the Snowy Mountains, in a move that will potentially drive a stake through the heart of the fossil fuel generation industry in Australia.
The move – which is subject to a feasibility study by the Australian Renewable Energy Agency, and funding agreements from Snowy Hydro’s three government owners (Federal, NSW, and Victoria) – could be the most significant intervention in Australia’s energy markets in half a century.
By promoting pumped hydro, Turnbull is effectively signing the death knell for any new coal or gas fired generation built by the private sector, and is paving the way for a 100 per cent renewable energy grid, driven mostly by wind and solar.
It also makes a reported and belated push for nuclear energy from members of his Coalition entirely redundant, because it would remove the need to rely on “baseload” generation over the medium to long term.
Assuming this does go ahead at the scale advertised, the conversation around energy delivery will now shift from “baseload” to flexibility, and gas and coal will no longer be able to compete, on either cost or utility, over the medium to long term.
Indeed, the biggest beneficiary of this push into pumped hydro could well be solar PV and wind energy, which are now the clear leaders in energy costs, with further sharp falls ahead.
And new generation is needed to replace ageing coal and gas generators, and meet new demand from growing population and electric vehicles.
By adding pumped hydro, and distributed battery storage (in homes, buildings and in EVs), Australia can reach a 100% renewable energy target, possibly within a few decades.
The ANU’s Andrew Blakers, who last month released an analysis that showed Australia could reach 100 per cent renewable energy with solar, wind and pumped hydro, at a cost of around $75/MWh – cheaper than current wholesale prices – describes the move as a game changer.
He estimates that once this scheme is completed, Australia will be nearly half way to having enough pumped hydro and other storage to support a wind and solar grid.
“A 100 per cent renewable energy grid will require around 450GWh of storage,” Blakers told RenewEconomy.
“Pumped hydro is by far the cheapest in the wholesale market,” he says. But around half the storage needed will come in the form of battery storage ‘behind the meter’, paid for by homes, businesses and electric car owners, and through demand management.
“It’s game over for gas, it’s game over for nuclear. Solar PV and wind have won the race,” Blakers said. It also makes life difficult for proposed solar thermal and storage technologies, unless they can compete in areas unsuitable for pumped hydro.
Australia already has around 2.5GW of pumped hydro, mostly in the Snowy Mountains, but also at Wivenhoe and Shoalhaven. This new initiative is to be formally announced by Turnbull in the Snowy Mountains on Thursday, but was widely distributed to the main papers overnight.
Pumped hydro is by far the cheapest form of storage,
The idea is to pair the huge Tantangara and the Talbingo reservoirs. Because the dams already exist, the cost of the pumped hydro is much reduced. The $2 billion will be spent on tunnels, power stations and poles and wires to connect it.
Indeed, there is nearly enough water in these reservoirs to provide enough dispatchable power to meet a 100 per cent renewable grid.
But no grid can put all its eggs in one basket, or in one location. So more storage capacity needs to be built in different places, such as the proposed pumped hydro plant at the Kidston gold mine in Queensland, to be paired with a solar power plant to push the water uphill.
Blakers says around 6GW more of pumped hydro will be needed, assuming that battery storage and demand management accounts for the rest.
Blakers says that pumped hydro is by far the cheapest form of storage, although it does rely on price volatility – the cost of pumping water uphill, minus 20 per cent losses, needs to be overcome by the cost received. In that sense, the building of such a scheme almost assumes, or at least relies on, more wind and solar being built.
Pumped hydro, however, cannot compete in smaller arrays, which leaves battery storage and other technologies to compete at the “distributed” level – say around 10MW to 20MW.
This will be important because storage needs to be distributed around the grid, lest a problem occur with the huge interconnectors.