Risk Mitigation and Investability of a U-PHS Project in The Netherlands

Gert Jan Kramer, Twan Arts, Janos L. Urai, Han Vrijling and Jan M. H. Huynen
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Gert Jan Kramer: Copernicus Institute of Sustainable Development, Utrecht University, Princetonlaan 8a, 3584 CB Utrecht, The Netherlands
Twan Arts: O-PAC Ontwikkelingsmij, Vrijthof 48, 6211 LE Maastricht, The Netherlands
Janos L. Urai: Institute for Structural Geology, Tectonics and Geomechanics, RWTH Aachen University, Lochnerstrasse 4-20, D-52056 Aachen, Germany
Han Vrijling: Department of Hydraulic Engineering, Delft University of Technology, Stevinweg 1, 2628 CN Delft, The Netherlands
Jan M. H. Huynen: Sogecom B.V., Vrijthof 48, 6211 LE Maastricht, The Netherlands

Energies, 2020, vol. 13, issue 19, 1-18

Abstract: We review the status of a 1.4 GW, 8 GWh underground pumped hydro storage (U-PHS) project in the southern Netherlands, which has been under development since the 1980s. Its history shows how the prospect of a large-scale U-PHS for The Netherlands (a country whose proverbial flatness prohibits PHS) has been attractive in every decade, based on proven technology in a subsurface location with validated properties, and solid analysis of its economics. Although the ongoing energy transition clearly requires massive electricity storage, (U-)PHS projects are challenging investment propositions, in The Netherlands, as elsewhere. This case study illustrates a point of general relevance, namely that although the project execution risk, related to uncertainty with respect to subsurface integrity, is very low, the transition risk, associated with the intrinsic uncertainties of an electricity system in transition, is significant. We point out mitigation strategies for both risk categories.

Keywords: pumped hydro storage; electricity storage; renewable energy; electric grid stabilization; energy transition; regional economic development (search for similar items in EconPapers)
JEL-codes: Q Q0 Q4 Q40 Q41 Q42 Q43 Q47 Q48 Q49 (search for similar items in EconPapers)
Date: 2020
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