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| Fig. 1: Raccoon Mountain Pumped Storage Facility (Source: Wikimedia Commons) |
One of the largest challenges to the generation of power is being able to supply the demand for peak load. Power plants operating at peak efficiency output the same amount of power at any point during a 24 hour period. Unfortunately, power isn't consumed equally across all hours. Most power is used during the day time to power our AC, heaters, ovens, and during the evenings when everyone gets home and uses things such as washers, dryers, and dish washers. In order to level the demand for peak power it would be very valuable to have a way of storing and generating this power at a moment's notice. Two of the major methods of storing this power are batteries and Pumped Hydro Storage (PHS). Here we will take a closer look at the cost of pumped water storage vis-à-vis batteries and conventional methods in order to understand the best options available.
When considering alternatives to generating electricity, we need to establish a baseline. A natural gas turbine has, "a capital cost of $500/kW, fixed O&M of $15/kW-yr, and variable O&M of 0.0055 $/kWh" with an additional $100/kW estimated for transmission and delivery to the urban center. [1] This is the bar by which everything else needs to be measured in order to determine the cost efficiencies. When analyzing costs it's important to not get lost in the various numbers or figures. The first number, $500/kW refers to the initial cost of the equipment for the ability to produce 1 kW of power. The second number, $15/kW-yr, refers to operation and maintenance (O&M) of that initial $500/kW investment per year. The third number, 0.0055 $/kWh, refers to operation and maintenance costs per unit of energy produced. What's missing is the actual cost of the fuel which will be higher in pumped water storage due to inefficiencies that range anywhere from 50-93%. [2,3] By comparison, diesel generators have a capital cost ranging from $300-900/kW. [4]
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| Table 1: Initial capital costs of various facilities, costs adjusted for inflation to year 2000 dollars, and capital cost in $/kW in year 2000 dollars. [7] |
Currently, the cost of storing a kilowatt-hour in batteries is about $400. [5] Energy Secretary Steven Chu in 2010 claimed that using pumped water to store electricity would cost less than $100 per kilowatt-hour, much less than the $400 kilowatt-hour cost of batteries. [5,6] But how much does it actually cost? Table 1 shows a list of pumped hydro storage facilities, their work capacities, initial costs and costs adjusted to 2000 dollars. As can be seen from the table, while the initial costs of pumped water storage may have been $100/kW, those estimates are all from the 1970's. Once adjusted for inflation, the capital cost ranges from $353/kW to $2,216/kW (2000 dollars) with median cost of about $615/kW, a 20% premium on the cost of a natural gas turbine. [1] Another study found the capital costs to range between $628.34 and $2,901 (2011 dollars). [8]
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| Table 2: Operation and Maintenance for a year adjusted for inflation to year 2000 dollars, daily energy generated, and Operation and Maintenance costs in $/kW in year 2000 dollars. [7] |
The Northfield Mountain Pumped Storage facility with it's 1000 MW capacity had operation and maintenance costs of $1.90/kW-year in 1979. This is compared to $12/kW-year for the Mt. Tom oil fired plant which has a capacity of 150 MW and $15/kw-year for a natural gas turbine. [1,7] Assuming a 50 year lifespan for the facility, that would amount to a savings of $505 in 1979 dollars between PHS and natural gas or a savings of $486 between PHS and diesel (the $1.90 was adjusted for inflation for an equal comparison with the $15/kW cost from the year 2000). In O&M costs pumped water storage facilities have a distinct advantage over the long term. The Taum Sauk Storage Facility and the Ludington Storage Facility have similar O&M costs of $5.64/kW-year and $2.12/kW-year. [7] The various O&M costs of several pumped water storage facilities can be seen in Table 2. [7]
The Guangzhou Pumped Water Storage facility in China was able to increase the efficiency of the Daya Bay nuclear power plant from 66% to 85% in 2000. [2] The ability to store this extra energy has allowed the nuclear plant to exceed its design capacity of 10,000 GWh in 2000 by a margin of 2,021 GWh. [2] This is a major advantage in having Pumped Hydro Storage. The ability of PHS to level demand and store excess power allows power plants to operate at their maximum efficiency all the time, creating a better return on investment. The utilization factor is also important. The Taum Sauk Pumped Storage facility had a utilization factor of 5-8%. This is in contrast with the Northfield Mountain Pumped Storage facility or the Blenheim-Gilboa Pumped Storage facility which have utilization factors of 25% and 20%, respectively. The Ludington facility, on the other hand, generates electricity 10 or more hours a day. [7] A Hydro Generator that is not being used to generate and deliver power is not providing a proper return on investment.
Pumped Hydro Storage seems to be a viable alternative to backup generators as a means to cover peak demand. Not only that, by serving as a reservoir of excess energy, PHS systems allow power plants to operate at their peak efficiency. However, PHS is not without it's drawbacks. A low utilization factor essentially makes it a very expensive monument with no actual utility. Also, the costs of construction can quickly balloon out of control such as with the Helms Pumped Storage facility, whose initial cost estimate of $200 million ballooned to $600 million in the course of several years. [7] Severe caution needs to be taken to ensure that that does not happen, as a $2,327/kW capital cost would overshadow any potential savings that could be earned from the difference in O&M.
© Oscar Galvan-Lopez. The author grants permission to copy, distribute and display this work in unaltered form, with attribution to the author, for noncommercial purposes only. All other rights, including commercial rights, are reserved to the author.
[1] E. A. Gilmore, P. J. Adams, and L. B. Lave, "Using Backup Generators for Meeting Peak Electricity Demand: A Sensitivity Analysis on Emission Controls, Location, and Health Endpoints," J. Air Waste Manag. Assoc. 60, 523 (2010)
[2] "Project Completion Report On The Guangzhou Pumped Storage Stage II Project In The People's Republic of China," Asian Development Bank, PCR:PRC 26369, November 2001.
[3] "Energy Storage Technology Roadmap: Technology Annex," International Energy Agency, March 2014.
[4] Cory R.A. Hallam, et al, "Hybrid Closed-loop Renewable Energy Systems: El Hierro as a Model Case for Discrete Power Systems," IEEE 6304314, 29 Jul 12.
[5] M. L. Wald, "From Harvard, a Cheaper Storage Battery," New York Times, 8 Jan 14.
[6] J. Mandel, "DOE Promotes Pumped Hydro as Option for Renewable Power Storage," New York Times, 15 Oct 10.
[7] "An Assessment of Hydroelectric Pumped Storage," Dames and Moore, November 1981.
[8] D. Connolly, et al, "Practical Operation Strategies For Pumped Hydroelectric Energy Storage (PHES) Utilising Electricity Price Arbitrage," Energy Policy 39, 4189 (2011).
