Oregon pumped storage project licensed

U.S. hydropower regulators have issued a license for a pumped storage project to be developed in Oregon. As licensed by the Federal Energy Regulatory Commission, the Swan Lake North Pumped Storage Hydroelectric Project would be located near Klamath Falls, and could produce 393.3 megawatts of power for up to 9 hours at a time.

Pumped storage projects cycle water between two reservoirs at different elevations, generally using equipment that can both pump water uphill for storage in the upper reservoir and then generate electricity by letting the water flow back down to the lower reservoir. Pumped storage can be used to store and release surplus energy (such as may be produced by wind or other nondispatchable renewable facilities), to provide reliability benefits, and to moderate electricity prices by pumping when prices are low and releasing when prices are high. While development of battery storage facilities is increasing, pumped storage facilities represent the vast bulk of currently deployed energy storage in the U.S.

In this case, the licensee is Swan Lake North Hydro LLC. The project is a joint development by Rye Development and National Grid. In 2015, the company applied to the Commission for a license to construct, operate, and maintain the project. Facilities described in the license include a new upper and lower reservoirs, connected by a series of penstocks and a powerhouse with generating/pumping facilities. According to the license order, the project will operate using off-peak energy (i.e., energy available during periods of low electrical demand) to pump water from the lower reservoir to the upper reservoir and generate energy by passing the water from the upper to the lower reservoir through generating units during periods of high electrical demand. Project generation will be timed "based on on-peak/off-peak power considerations, the need to augment the production of renewable wind and solar power generation, or to provide ancillary power services."

The license order addresses project economics. As licensed, the project is expected to generate 1,187,000 megawatt-hours per year, at a levelized annual cost of about $114,968,700, or $96.86 per megawatt-hour. Considering an alternative power cost of $108.09/MWh, the order suggests that in the first year of operation, project power will cost $13,329,300, or $11.23/MWh, less than the cost of alternative power.

The Commission granted the project license for a 50-year term, citing the "substantial investment in new facilities."