| The Goldendale Energy Storage Project is planned adjacent to the John Day Dam, which straddles Oregon and Washington on the Columbia River. |
An affiliate of US renewable energy and energy storage developer rPlus Energies LLC in February submitted a final license application with the Federal Energy Regulatory Commission for its estimated more than $2.5 billion White Pine Pumped Storage Project in White Pine County, Nev.
It marks an important milestone for the proposed facility, which is effectively a massive water battery designed to discharge 1,000 MW over eight hours to help balance an electric grid increasingly rich in variable renewable energy generation. Only a handful of new pumped storage projects have reached this stage of review in recent years amid a decadeslong development drought for the once-dominant bulk power storage technology.
"In a perfect world, [FERC] would grant the license in two years," rPlus Energies President Luigi Resta said in an interview. That would put the White Pine project in position to break ground in 2025 and come online around 2030, pending environmental permits, commercial agreements and other substantial development requirements.
The subsidiary of Utah-based real-estate developer Gardner Co. LC is among several companies vying to breathe new life into the nation's most widely commercialized energy storage technology, which has lost ground in recent years to grid-scale lithium-ion batteries. Others include affiliates of Warren Buffett's Berkshire Hathaway Energy, renewable energy giant NextEra Energy Inc. and Danish fund manager Copenhagen Infrastructure Partners P/S.
A valuable new federal investment tax credit for stand-alone energy storage, passed as part of the Inflation Reduction Act of 2022, along with additional incentives for domestic content and projects in certain "energy communities," have enhanced the prospects for new pumped hydro, according to Resta.
"That really helps the economics," the executive said. "Ultimately, whether the utility owns the projects or we own them through a long-term [power-purchase agreement] or tolling agreement, they're 100-year assets." With lengthy contracts and amortization schedules, "the costs become really low," Resta added.
In addition, pumped storage projects are not exposed to the same kind of global supply chain risks that have created headaches for developers and buyers of lithium-ion battery projects. And there are increasing calls from federal and state governments, utilities and independent grid operators for longer-lasting energy storage than the typically up to four-hour battery systems now dominating annual energy storage additions.
"There is definitely a business case for the pumped storage," Resta said.
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Long duration, longer licensing
PacifiCorp, a utility subsidiary of Berkshire Hathaway Energy that serves retail customers in six Western states, is among those giving pumped storage a fresh look, including with 11 preliminary permits of its own pending before FERC.
"We're now at a point were we need to add new types of dispatchable resources that can fill that gap that was once served by fossil fuel plants," said Stefan Bird, president and CEO of Pacific Power, the PacifiCorp division that serves customers in Oregon, Washington and California. While lithium-ion batteries are "great in that two- to four-hour zone," pumped storage "could be eight to 18 hours of duration," Bird said.
But a long and arduous licensing process, sometimes extending over a decade, is a major cause of uncertainty for new projects.
"Given the long lead-time and costs associated with constructing pumped storage projects, it is important that Congress and federal agencies take steps to streamline the permit process for these projects," Timothy Hemstreet, PacifiCorp's managing director of renewable energy development, said in testimony before the US Senate Committee on Energy and Natural Resources in September 2022.
Roughly 23 GW of pumped storage capacity is in operation at 43 sites around the country, according to the US Energy Information Administration. Most of that entered service before the 1990s. Although more than 9 GW of lithium-ion batteries and other non-hydro forms of storage have come online in recent years, pumped storage still accounts for over two-thirds of total installed US storage capacity.
The last pumped hydropower project to come online in the US, however, was the San Diego County Water Authority's 42-MW Lake Hodges Hydroelectric Facility (Olivenhain) in 2012, according to S&P Global Market Intelligence data.
Closing the loop
San Vicente, like White Pine and several other pumped storage proposals, is a closed loop project. Different than traditional "open loop" facilities, such projects recycle water between upper and lower reservoirs and operate independently of natural waterways, reducing environmental impacts. They require water only for the initial fill and to make up for evaporation over time.
Other such projects pending before FERC include rPlus Energies' roughly $2.5 billion Seminoe Pumped Storage Project in Carbon County, Wyo., for which affiliate rPlus Hydro LLLP submitted a final license application in January, and Copenhagen Infrastructure Partners' more than $2 billion closed loop Goldendale Energy Storage Project in Klickitat County, Wash.
The 1,200-MW Goldendale project, planned near the existing John Day hydro dam on the Columbia River, is designed to offer 12-20 hours of storage. The Danish firm acquired Goldendale along with the already licensed 393-MW Swan Lake Energy Storage Project in Klamath County, Ore., in 2020.
The Swan Lake complex, a closed loop facility with up to 9.5 hours of storage capacity, is scheduled to break ground as soon as this year and enter operation in 2026. It would connect to the PacifiCorp grid, though no commercial agreement has been disclosed.
Copenhagen Infrastructure Partners is also an investor in the 400-MW Gordon Butte Pumped Storage facility in Meagher County, Mont., another closed loop design. Although licensed in 2016, the project still does not have a power offtake agreement and has not broken ground.
The Eagle Mountain Pumped Storage Hydroelectric Project, a 1,300-MW proposal designed to repurpose two existing mining pits in Riverside County, Calif., was licensed in 2014. Developer Eagle Crest Energy Company Inc. must start construction on the project by June 19, 2024, and complete the project by June 19, 2027, in accordance with a FERC extension granted last year.
NextEra Energy Resources LLC, which is partnering with Eagle Crest to build the project, called for regulatory changes in California to support longer-duration resources. Developers of pumped storage and other long-duration energy storage technologies asked the state to revise its resource adequacy framework to encourage utilities to procure resources providing more than four hours of discharge.
A rulemaking proceeding is underway at the California Public Utilities Commission (CPUC) to consider changes to the program. (R-2110002)
'Active discussions' with utilities
The proceeding aligns with a 2021 CPUC procurement order that included a 1,000-MW carve-out for storage projects able to deliver at least eight hours of discharge. Initial eight-hour deals have been awarded to developers of lithium-ion battery and compressed-air energy storage projects.
But there are signs the pumped storage drought may soon end.
NV Energy Inc., another utility subsidiary of Berkshire Hathaway Energy, is considering participating in rPlus Energies' White Pine project — and potentially purchasing it — in order to diversify its energy storage resources and help to integrate rising volumes of solar power, according to a 2022 filing with the Public Utilities Commission of Nevada.
The utility has a signed interconnection agreement with the developer.
"We are in active discussions with many utilities where our storage projects are," Resta said.
Meanwhile, labor groups and local officials in White Pine County are eager to see the project move ahead. It could bring up to 500 construction jobs and more than 35 new full-time, skilled positions and contribute an estimated $12 million in additional annual tax revenue for state and local governments.
"White Pine County is geographically and politically positioned to be the future of Nevada's energy production, transmission, and storage," White Pine County Manager Mike Wheable said in a March 8 statement.
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