9
Cost Analysis of Hydropower
fixed. Reduced costs for tunnelling or canals can open up
increased opportunities to generate electricity.
Hydropower can facilitate the low-cost integration of
variable renewables into the grid, as it is able to respond
almost instantaneously to changes in the amount of
electricity running through the grid and to eectively
store electricity generated by wind and solar by holding
inflows in the reservoir rather than generating. This
water can then be released when the sun is not shining
or the wind not blowing. In Denmark, for example, the
high level of variable wind generation (>20 % of the
annual electricity production) is managed in part through
interconnections to Norway where there is substantial
hydropower storage (Nordel, 2008a).
Pumped storage hydropower technologies
Pumped hydro plants allow o-peak electricity to be
used to pump water from a river or lower reservoir up
to a higher reservoir to allow its release during peak
times. Pumped storage plants are not energy sources but
instead are storage devices. Although the losses of the
pumping process contribute to the cost of storage, they
are able to provide large-scale energy storage and can
be a useful tool for providing grid stability services and
integrating variable renewables, such as wind and solar.
Pumped storage and conventional hydropower with
reservoir storage are the only large-scale, low-cost
electricity storage options available today (Figure 2.3).
Pumped storage represents about 2.2 % of all generation
capacity in the United States, 18 % in Japan and 19 % in
Austria (IEA, 2012 and Louis, 2012).
Pumped storage power plants are much less expensive
than lead-acid and Li-ion batteries. However, an
emerging solution for short-term storage are Sodium-
Sulphur (NaS) batteries, but these are not as mature as
pumped hydro and costs need to be confirmed (Figure
2.3). However, pumped storage plants are generally more
expensive than conventional large hydropower schemes
with storage, and it is often very dicult to find good
sites to develop pumped hydro storage schemes.
Pumped hydropower systems can use electricity, not
just at o-peak periods, but at other times where having
some additional generation actually helps to reduce grid
costs or improve system security. One example is where
spinning reserve committed from thermal power plants
Run-of-river schemes are often found downstream of
reservoir projects as one reservoir can regulate the
generation of one or many downstream run-of-river
plant. The major advantage of this approach is that it can
be less expensive than a series of reservoir dams because
of the lower construction costs. However, in other cases,
systems will be constrained to be run-of-river because a
large reservoir at the site is not feasible.
The operation regime of run-of-river plants, with and
without pondage, depends heavily on hydro inflows.
Although it is dicult to generalise, some systems will
have relatively stable inflows while others will experience
wide variations in inflows. A drawback of these systems
is that when inflows are high and the storage available
is full, water will have to be “spilled”. This represents
a lost opportunity for generation and the plant design
will have to trade o capacity size to take advantage of
high inflows, with the average amount of time these high
inflows occur in a normal year. The value of the electricity
produced will determine what the trade-o between
capacity and spilled water will be and this will be taken
into account when the scheme is being designed.
Hydropower schemes with reservoirs for
storage
Hydropower schemes with large reservoirs behind dams
can store significant quantities of water and eectively
act as an electricity storage system. As with other
hydropower systems, the amount of electricity that is
generated is determined by the volume of water flow
and the amount of hydraulic head available.
The advantage of hydropower plants with storage is that
generation can be decoupled from the timing of rainfall
or glacial melt. For instance, in areas where snow melt
provides the bulk of inflows, these can be stored through
spring and summer to meet the higher electricity
demand of winter in cold climate countries, or until
summer to meet peak electricity demands for cooling.
Hydropower schemes with large-scale reservoirs thus
oer unparalleled flexibility to an electricity system.
The design of the hydropower plant and the type
and size of reservoir that can be built are very much
dependent on opportunities oered by the topography
and are defined by the landscape of the plant site.
However, improvements in civil engineering techniques
that reduce costs mean that what is economic is not