An Exploratory Economic Analysis of Underground Pumped-Storage Hydro Power Plants in Abandoned Deep Coal Mines

Reinhard Madlener and Jan Martin Specht
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Jan Martin Specht: Institute for Future Energy Consumer Needs and Behavior (FCN), E.ON Energy Research Center/School of Business and Economics, RWTH Aachen University, Mathieustrasse 10, 52074 Aachen, Germany

Energies, 2020, vol. 13, issue 21, 1-22

Abstract: This study researches the concept of underground pumped-storage hydro power plants in closed-down underground hard coal mines in Germany. After a review on how this could be realized technically, an economic feasibility analysis is presented, with a particular focus on the costs for the underground storage reservoir. The analysis is performed for different lower (i.e., underground) reservoir sizes and temporal arbitrage potentials (peak/off-peak electricity price spreads), and cost uncertainty is dealt with by means of a Monte Carlo simulation for two distinct head heights. The findings regarding costs and acceptability are compared with those of a classic (on-surface) pumped-storage hydro power plant in a mountainous area. Based on a techno-economic evaluation we conclude that under favorable conditions the realization of underground pumped-storage hydro power (UPSHP) plants seems both technically feasible and economically reasonable. More specifically, an extension of a tubular system seems the most promising option. A UPSHP plant in a mineshaft is probably slightly more expensive than a conventional one, an outcome that depends strongly on the feasible head height. However, the significant reduction of the adverse impacts on the landscape and on local residents, as well as a potentially large number of feasible sites in flat terrain, could make UPSHPs an interesting option for the future energy transition, not just in Germany but worldwide at sites where underground mining is being abandoned.

Keywords: hydro power; pumped storage; coal mining; reservoir engineering; massive energy storage; economic viability; temporal arbitrage; Germany (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
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (6)

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