The Federal Association of the Energy and Water Industry (BDEW), its Swiss counterpart VSE and the Austrian Energy Association Österreichs Energie agreed to work together to improve the transnational coordination concerning the construction of pumped storage hydro power plants. The associations demanded fair regulatory conditions for these kind of power plants.
The cooperation between the energy associations supports a transnational cooperation concerning the expansion of pumped storage power plants agreed upon between the responsible ministries in Germany, Austria and Switzerland in May 2012, BDEW pointed out.
The three energy associations believe that the construction of new pumped storage power plants would bring clear economic and ecological benefits, BDEW said. With efficiency rates of up to 85% they were the most economical storage technology for electricity. New projects were, however, in danger in view of the current distortions at the electricity markets, BDEW pointed out. A joint brochure issued by the three associations further explains the perceived market distortions with the growing amount of renewable energy that is mostly financially supported (in Germany by fixed feed in tariffs pursuant to the Renewable Energy Sources Act) and the price slump for coal and emission allowances. The seasonal fluctuation as well as price differences between base and peak prices over the course of the day had considerably decreased, affecting the economic viability of pumped storage power plants, which depended to a large extent on the price differences at the electricity exchanges, the brochure says.
BDEW, VSE and Oesterreichs Energie therefore called on European and national institutions and decision makers to improve the framework conditions for operating and building pumped storage power plants. Measures should focus an reducing duties and abstaining from regulatory interventions, removing barriers, accelerating projects and adapting market conditions, BDEW said.
In June the municipal utility cooperation Trianel announced to abstain from a pumped storage power plant project in the Eifel region in North Rhine-Westphalia with a planned capacity of 650 MW, citing a lack of political backing.
According to BDEW information, 170 pumped storage power plants operate in Europe. With a total capacity of 12,500 MW a large part of Europe’s capacity is located in Austria, Germany and Switzerland. Power plant projects with a capacity of 11,000 MW are in preparation or under construction. The total capacity would suffice to cover the need for storage and flexibility in the three countries up until 2020, BDEW says, pointing out that new pumped storage power plants will also be needed after that date to balance the fluctuating input of the growing amount of renewable energy and stabilise the grids.