Today AGL announced it had secured the right to develop, own and operate a 250-megawatt pumped hydro energy storage project at Hillgrove Resources Limited’s Kanmantoo copper mine in South Australia’s Adelaide Hills region.

The proposed Kanmantoo Pumped Hydro facility would contribute to AGL’s energy mix – providing more flexible and firming energy that can be activated quickly to supply energy during peak periods and whenever renewables aren't available.


What’s the case for flexible energy?

The energy market is more complex than ever – the increased uptake of rooftop solar has meant that less capacity is required during the day. This has led to demand in the National Energy Market (NEM) becoming ‘peakier’.

To match the changes in demand, the sector is progressively transitioning from primarily traditional base-load energy generation, to more flexible and renewable sources of energy that can match the peaks and troughs in demand.

Peaking or flexible power supply, like the energy that would be generated from the proposed Kanmantoo Pumped Hydro facility has an extremely important role to play in an energy mix as it can be switched on to bolster energy supply when the community needs it.


How is AGL approaching this transition?

For AGL, as our traditional coal-fired power stations and, in South Australia, Torrens Island gas-fired power station progressively reach the end of their operating life, we’ve had to think about how to replace them at the least cost.

We've done the sums and what makes the most sense is cheap, renewable energy from wind and solar, combined with more flexible and firming energy sources (like quick-start gas generation, large-scale batteries and pumped hydro), that can supply energy during peak periods or whenever renewables aren't available.

We’re investing in flexible energy sources - The Kanmnatoo Pumped Hydro facility, along with the potential Bells Mountain Pumped Hydro project, the AGL operated ElectraNet’s 30 MW large-scale battery and the Barker Inlet Power Station, will provide additional dispatchable capacity to our portfolio. This capacity has an important role to play in meeting surges in customer demand, to supplement outages or when renewables aren’t available.

Update: in February 2020, AGL and Hillgrove Resources Limited, which owns the Kanmantoo site, mutually agreed to not continue with the proposed pumped hydro project. However, AGL remains committed to continuing the development of energy storage projects such as batteries and pumped hydro to providing firming capacity to the market.

These projects include a 100 MW battery in Wandoan, Queensland, a 30 MW battery in South Australia, and four 50 MW batteries to be built in NSW. We are also investigating the feasibility of a 250 MW pumped hydro plant at Bells Mountain in NSW, and a 50 MW battery at Broken Hill.