If the $6.8 million full feasibility study is successful, this proposal would nearly double the capacity from the existing 240MW to 475MW.

The Shoalhaven Pumped Hydro Storage Scheme currently consists of two pumped storage hydropower stations at Kangaroo Valley and Bendeela.

Earlier this year, Origin undertook pre-feasibility work on three potential design options for expanding the scheme.

ARENA’s funding will go towards a full feasibility study based on the preferred option, which involves bypassing the Kangaroo Valley Power Station and instead pumping water from Lake Yarrunga to Fitzroy Falls Reservoir.

The option includes a 235 MW underground power station, taking advantage of the longer water head available, resulting in a higher output and efficiency.

ARENA CEO Darren Miller said the proposed expansion would help provide large-scale storage and would inform other pumped hydro developments.

“For more than 40 years, Shoalhaven’s pumped hydro scheme has been delivering reliable renewable power to the NSW grid. When it was built in 1977, Shoalhaven was future proofed to allow for more capacity to be added later on, which should reduce the cost and environmental impact of this project,” he said. 

“The potential expansion of this scheme would provide more electricity over a shorter period so Origin can deliver capacity when needed – when demand is high or when renewable output is low.”

Mr Miller said the findings of this study would help provide key understandings that can be applied to other hydro energy projects ARENA has supported such as Snowy 2.0 or Hydro Tasmania’s Battery of the Nation initiatives. 

“We know that storage technologies – both pumped hydro and batteries – will be key to the transition to renewable energy in Australia, which is why we’re supporting projects such as this that will help deliver secure and reliable electricity,” he said. 

Origin executive general manager energy supply and operations Greg Jarvis said he welcomed ARENA’s support of a feasibility assessment. 

“The Shoalhaven is in the unique position of having much of the required infrastructure needed for expansion already in place,” Mr Jarvis said. 

“This means it can be developed with less community and environmental impacts and in a shorter timeframe compared to developing the same amount of additional capacity as a greenfields project.” 

The project, according to Mr Jarvis, is a strong prospect for future expansion, because Shoalhaven can feed electricity into the grid in as little as three minutes, therefore improving reliability and complementing growing intermittent renewables in the system.

“We will now get on with important assessments and the necessary regulatory approvals that may allow us to double Shoalhaven’s generating capacity in the future,” he said.

A full feasibility study is expected to be completed in 2019.