LONDON (Reuters) - British power generator SSE (LON:SSE) will invest 100 million pounds ($122 million) in a Scottish pumped hydro scheme which could help boost the country’s energy storage capacity, it said on Tuesday.
Pumped hydro plants work by pumping water uphill to a higher reservoir before releasing it to enable water to flow downhill through turbines to produce electricity when it is needed.
Developers of the technology say it can help to balance out a growing amount of renewable electricity on the power grid, using the surplus renewable power when demand is low to pump the water and storing it so it is ready to be released when demand is high.
The Coire Glas project, on the shores of Scotland’s Loch Lochy, could power about 3 million homes and would cost around 1.5 billion pounds to build, the company said.
A final investment decision is expected in 2024 and the project could be up and running by 2031 but the company said it needs clarity from the government on its policies around energy storage.
"Whilst Coire Glas doesn’t need subsidy, it does require more certainty around its revenues and it is critically important the UK Government urgently confirms its intention on exactly how they will help facilitate the deployment of such projects," Gregor Alexander, SSE Finance Director said in a statement.
The 100 million pounds invested now will be spent on design and advancing the project towards an investment decision and site investigation works, SSE said.
Britain’s government said during the budget last week that measures to support energy security will be announced later in March.
($1 = 0.8169 pounds)