Energy Transition Handbook - Flipbook - Page 23
Energy Transition Handbook 2021
23
Hydro
Hydropower is expected to remain the world’s largest source of renewable electricity
generation and to play a critical role in decarbonising the power system and improving
system flexibility.
Hydropower is a mature technology, yet it
continues to evolve. Reservoir hydropower plants
and pumped storage plants are particularly suited
to providing baseload capacity / system flexibility,
while run-of-the river hydropower plants are
themselves variable according to current or
seasonal weather conditions.
Reservoir hydropower plants rely on stored
water in a reservoir. This provides the flexibility
to generate electricity on demand and reduces
dependence on the variability of inflows.
Very large reservoirs can retain months or even
years of average inflows and can also provide
flood protection and irrigation services.
Pumped storage plants use water that is pumped
from a lower reservoir into an upper reservoir
when electricity supply exceeds demand or
can be generated at low cost. Generators then
monitor the demand market; when demand
exceeds instantaneous electricity generation
and electricity has a high value, water is released
to flow back from the upper reservoir through
turbines to generate electricity. Pumped storage
currently represents the overwhelming majority of
on- grid electricity storage. Interestingly, over the
five-year period 2018-23, more pumped storage
plants are expected to be installed for global
electricity storage than stationary battery storage
technologies deployed (partially for the advantage
/ arbitrage described above, and as a result of a
greater needs for system flexibility to integrate
variable renewables in China, Asia-Pacific
countries, Europe and the MENA region).
Pumped storage capacity is expected to increase
26 GW, while stationary battery capacity expands
only 22 GW. That being said, financing new such
projects and operating existing ones profitably
remain key challenges, particularly in markets
in which revenues from energy arbitrage are
uncertain, grid fees exist, and/or remuneration
mechanisms that value the system services
provided by pumped storage projects are lacking.
Run-of-river hydropower plants harness energy
for electricity production mainly from the
available flow of the river. These plants may
include short-term storage or “pondage”, allowing
for some hourly or daily flexibility but they usually
have substantial seasonal and yearly variations.
Importantly, governments increasingly recognise
hydropower as playing a vital role in national
strategies for delivering affordable and clean
energy, managing freshwater, combatting
climate change and improving livelihoods,
helping countries work towards UN Sustainable
Development Goals.
As such, hydropower is
•
proven to provide multiple services
•
seen as crucial in building resilience
to climate change
•
naturally suited to allow digitalisation and
regional interconnections to bring efficiencies
to clean energy generation
“Strong international presence, high
competence and experience.”
Chambers Europe, 2021