| Pumped storage
The three licensed projects are: Eagle Mountain in Southern California (1300MW), Gordon Butte in Montana (400MW) and Swan Lake in Oregon (393MW). In addition, FERC reports that over 50GW of pump storage development have been issued a preliminary permit or are in the process to receive a permit. NHA says that although not all the 67 projects will become operational, the growing level of investor interest is a strong signal that there is significant consumer demand for long duration storage to balance the system, integrate renewables and increase the resilience of the grid. The report goes on to list some of the many challenges faced by pumped storage developers and include: ● Tax policy – Current federal tax policy means some energy storage technologies receive a 30% investment tax credit while pumped storage does not. This can make a substantial difference within a competitive utility procurement setting.
● State procurement policy – Most states that have renewable portfolio standard mandates or energy storage procurement targets either implicitly or explicitly exclude pumped storage. Even “technology neutral” policies can include short development timelines or contracting structures that exclude PSH and favour other storage technologies.
● Market policy – Many of the grid services that PSH provides are either undercompensated or not compensated at all.
● Utility procurement policy – Most utilities do not accurately model the full benefits of PSH including the full range of services provided by advanced turbine technologies. Additionally, when comparing PSH to other alternatives utility planners often fail to account for the long lifespan differences.
● Federal permitting policy – Although recent changes created a two-year expedited licensing process for closed-loop or “off-river” pumped storage, the implementation of this process has made it difficult for projects to qualify. As of September 2021, no PSH project has successfully navigated the expedited process.
The NHA report has the following recommendations: 1. Federal policy makers should pass a federal investment tax credit for storage to be on a level playing field with wind and solar. The credit should be a 10-year safe harbour to account for PSH’s long development timeline.
2. Vertically integrated states should require consideration of long duration energy storage resources in integrated resource planning processes, including requiring equal consideration with traditional resources.
3. The Federal Energy Regulatory Commission should develop clear policies on how generation assets like pumped storage can compete to provide transmission services while avoiding double recovery of revenues and limiting impacts to current market participants.
4. State policy makers should allow all energy storage technologies, including PSH, to participate in renewable portfolio standard programmes (or clean energy standards) on a technology neutral-basis. In addition, state energy storage targets should incorporate longer term goals to ensure pumped storage, can compete with other technologies.
5. Request FERC to establish a common methodology for value of energy storage and capacity products that can be utilised across the spectrum of technologies available to provide these services.
6. Request FERC to streamline the licensing process even further for low-impact pumped storage hydropower, such as off-channel, modular or closed-loop projects. ●
More information This is the third NHA Pumped Storage Report and follows previous publications in 2012 and 2018. The Pumped Storage Report 2021 can be read in full at:
https://www.hydro.org/news/nha-unveils-new- 2021-u-s-pumped-storage-hydropower-report/
Top: Exelon’s Muddy Run Pumped Storage Station in Pennsylvania
Above: Rocky Mountain Pumped Storage Station in Georgia
Pumped storage employment In its pumped storage report the National Hydropower Association estimates the number of jobs expected during the development of a pumped storage project. Each project would be unique in the number of employees needed but for planning purposes, the following job estimates have been used: ● Engineering/Design/Permitting – 100 jobs for approximately 7 years ● Manufacturing – 50 jobs for approximately 3 years ● Construction/Commissioning - 1000 jobs for approximately 4 years ● Project Operations – 25 permanent jobs Ongoing jobs at pumped storage facilities typically pay above the median wage of the surrounding areas.
www.waterpowermagazine.com | November 2021 | 17
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