The shift towards wind and solar in energy generation is described as being the fastest transition in history, with the International Energy Agency projecting these renewable resources will account for 54–71 % of total global electricity generation by 2050. Although great for reaching net zero targets, if there isn’t enough storage capacity for such an amount of variable energy, power grids are at risk of having too much or too little supply to meet changing demands throughout the day, seasons, and beyond.

Described as a monumental step forward and a sign the world is recognising the critical role of flexibility in delivering future energy security, over 100 countries have now committed to the Global Energy Storage and Grids Pledge which was proposed by the COP29 Presidency. It calls on governments and non-state actors to commit to a deployment target of 1500GW of energy storage, doubling grid investment and the development of 25 million kilometres of grid infrastructure by 2030. And now with COP30 on the horizon, industry leaders are calling for further endorsements and translation of these targets into actionable national plans.

Eddie Rich, CEO of the International Hydropower Association (IHA), and Vice-Chair of Global Renewables Alliance, commented that a lack of long duration energy storage has been “the ignored crisis within the current energy crisis”. 

“COP29 was the first time world leaders acknowledged that the climate transition is not just about renewables volume, but also about the right mix and systems,” he said. “These global targets need to be urgently translated into national plans and projects to keep net zero within reach.”

Pumped storage’s vital role of in securing reliable, low-carbon energy systems was recently highlighted at a landmark series of discussions in Australia. Policymakers, industry leaders, and investors were brought together by GHD and the IHA to discuss the technology’s part in Australia’s energy future. 

As Penny Sharpe, Minister for Energy of New South Wales, said, backing wind and solar with long duration storage will help to power households and industries across Australian states. But, she cautions, “we have to get it right”.

“This revolution in clean energy is happening,” Malcolm Turnbull, President of IHA, said, referring to the fact that as they’re the cheapest form of new generation, Australia is rolling our solar and wind power at record rates because. “But we need to move just as quickly to deliver the storage – both short and long duration – to firm these variable renewables and ensure reliability and efficiency when the wind doesn’t blow, and the sun doesn’t shine. The market alone will not deliver this back-up energy, and much more needs to be done if we’re going to incentivise the development of long-duration storage needed to maintain reliability. It’s not a choice between batteries and pumped hydro, we need both, but we need to act now,” he urged. 

Tammy Chu, IHA Vice-Chair and Interim Executive General Manager for Construction at Hydro Tasmania, added that the synergies between variable renewable energy generation and pumped storage must be recognised and valued to support the development of efficient and reliable electricity grids, in Australia and internationally.  

Convened in both Brisbane and Syndey, this series of discussions focused on the urgent need to scale up pumped storage as a “cornerstone of Australia’s clean energy transition”. Participants examined the markets and revenues, project development, and contractual risks associated with pumped storage projects to support financing models, policy frameworks, and regulatory barriers that must be addressed to unlock investment in new projects

“Despite some hurdles, there’s a vast opportunity for pumped hydro to support our renewable energy future ahead of the hard deadline of coal power station closures,” Helen Barbour-Bourne, GHD’s National Sector Lead for Hydropower, said.

For the energy transition to run smoothly, Anthony Garnaut, Chief Executive Officer at ZEN Energy commented that: “We don’t need to develop new technologies so much as to learn how to deploy proven technologies well. One of these old technologies is pumped hydro”. 

The wheels are in motion though. A point proven by the Australian Energy Market Operator Services’ recent announcement when selecting a pumped hydro project for the first time in its latest NSW Roadmap tender – nearly tripling the scheme’s supported energy storage capacity to 1.03 GW and 13.79 GWh, surpassing the 1 GW target.

James Katsikas from EDF Australia said his company was dedicated to leveraging its global expertise to develop projects like Dungowan Pumped Hydro. EDF acquired the scheme from Mirus Energy in 2023. With 300MW and 10 hours of storage the new pumped storage plant will be positioned downstream from existing dam. And speaking about his company’s proposed Borumba Project, Kieran Cusack, Chief Executive Officer at Queensland Hydro said pumped hydro energy storage is “unquestionably the right technology to support Queensland’s clean energy transition”. 

EDF India has recently outlined policy recommendations to enhance pumped storage development and attract global investors, in a move it hopes will assist with India’s long-term energy security. 

Indian power capacity reached 46GW in January 2025, with solar and wind contributing 32% of the total. And by 2032, these renewable sources are expected to expand to 487GW, forming 54% of a projected 900GW power system. To maintain grid stability and effectively use renewable energy, India requires 27GW/175GWh of pumped storage capacity by 2031–32.

Key recommendations from EDF’s report called Strengthening India’s Pumped Storage Plant Framework, include:

• Project allotment and procurement: Introducing a two-step procurement process where technical feasibility is assessed before price bidding to improve project viability.
• Payment security measures: Establishing a centralised PSP procurement agency, similar to Solar Energy Corporation of India, to streamline contracts and ensure timely payments. State-backed escrow accounts linked to distribution company revenues could also mitigate payment risks.
• Regulatory and supply chain improvements: Simplifying approval processes through single-window clearance and offering temporary waivers on import duties for critical PSP components until domestic production meets demand. Aligning PSP procurement with global environmental, health, and safety standards could also enhance investor confidence.

Using pumped storage technology and designed to enable total renewables integration, Augwind – a company which recently joined the IHA – has been working hard on developing a pioneering AirBattery technology.  

Combining the strengths of both pumped storage hydropower and compressed air energy storage, AirBattery provides sustainable hydropower by utilising the same water pumps as pumped storage hydropower, but with less water and land requirements. The company has also recently commissioned a 0.5MW/1 MW demonstration site.  

As Augwind Founder and CEO, Dr. Or Yogev, said: “While innovation is key to decarbonisation, true disruption of the energy sector requires a cumulative effort by many stakeholders”. 

IHA CEO Eddie Rich welcomed Augwind as new members of the association and agrees that innovation in renewables is key to solving the various challenges the sector faces. 

Reservoir-based hydropower can provide flexibility on short and long timescales, helping to accommodate rapidly growing shares of variable wind and solar power into power grids. However historically, such theoretical flexibility has been largely underutilised for at least two primary reasons. 

As Wang et al explain in Energy Reports, operational flexibility has been less important in traditional systems with low penetrations of variable renewable resources and high penetrations of dispatchable thermal generation resources that offer substantial flexibility.  In addition, the theoretical flexibility of individual hydropower resources may be constrained in practice by factors such as:

• Outdated operational practices.
• Inefficient market structures.
• Technical limitations imposed by ageing infrastructure.
• Non-power water flow constraints imposed by environmental or ecological considerations.

In their research the authors conduct a capacity expansion analysis of a two-zone system – a hydro-dominated region and a neighbouring region with aggressive decarbonisation targets, as represented by the Pacific Northwest and California regions in the US. Working to address several existing knowledge gaps they:

• Introduced a flexibility index as a proxy for the level of operational flexibility available to reservoir hydro resources.
• Analysed how varying levels of hydropower flexibility, rather than simply an on-off dichotomy, influence the amount of new wind and natural gas generation capacity in the system least-cost generation portfolio.
• Assessed how transmission congestion impacts the ability of hydropower flexibility to influence least-cost generation investment pathways in neighbouring regions.
• Applied a reliability assessment model to quantify the synergies between flexible hydro power and wind resources in meeting system resource adequacy objectives.

More specifically, they add, when the flexibility index increases from 0 to 20%, wind generation increases by 297MWh per MW of installed reservoir hydropower and the combined value of reductions in system cost and emissions total US$38,587 per MW of installed reservoir hydropower. These metrics exhibit decreasing marginal returns as the flexibility index approaches 100%, reducing to 49MW of installed hydropower when the flexibility index increases from 80% to 100%. 

Two major changes in the system dispatch profile where also observed when hydropower operates with more flexibility. Wang et al found reservoir hydropower generation decreases when excess wind generation is available and subsequently increases to cost-effectively displace costly natural gas generation. As a result, the operating profits of reservoir hydropower resources also increase with increasing flexibility, as they can shift generation to periods with higher energy prices. 

Further demonstrating a substitution effect between the grid services provided by flexible hydropower operation, increased transmission capacity on a congested line, and energy storage resources, the authors believe these results suggest infrastructure investments or operational changes that increase the operational flexibility of hydropower should be considered in tandem with transmission upgrades and energy storage investments.

It may also be prudent, they add, to revisit policies, regulations or practices that inhibit the operational flexibility of hydropower due to non-power considerations. Many of the restrictions may have been established at a time when there was much less need for power system flexibility, and with increasing renewable generation worldwide, it may mean increasing hydropower flexibility requires trade-off with other non-power hydro services. 

“Although we did not explore specific approaches for increasing operational flexibility in practice, our findings suggest that relaxing operational constraints, when feasible, can yield significant advantages to the electricity system. Such relaxation could be achieved by retrofitting aging infrastructure, implementing advanced turbine technologies, or upgrading control systems,” Wang et explain. In addition, revisiting existing regulations or operational paradigms may also reveal new opportunities to enhance operational flexibility without negatively impacting other river services.

Norwegian hydropower has previously been identified as having a potential role to play in managing variations in wind and solar power across Northern Europe. Previous estimations have suggested that upgrading hydroelectric power plants at existing reservoirs in southern Norway could boost production capacity by 11-20GW and pumping capacity by 5GW. Furthermore, any environmental impacts are expected to be relatively low since the construction would involve new tunnels connecting to existing reservoirs rather than creating new reservoirs, and discharge flow into large reservoirs or fjords.

Recent research by Anders Arvesen et al in Earth Environmental Science has highlighted how expanding hydropower and transmission can potentially:

• Reduce price spikes during periods of low wind/solar output.
• Reduce wind/solar energy curtailment during periods of high wind/solar output.
• Reduce price differences between interconnected areas during periods of either low or high wind/solar output.

The authors say these effects are attributable to more dynamic operation and expanded operational ranges of hydropower and transmission in the simulations assuming expanded hydropower and transmission capacities. Although they acknowledge there is high fundamental uncertainty in modelling a future system for the year 2050.

It is also crucial to investigate the potential contribution of Norwegian hydropower in managing challenging weather events related to wind and solar energy variability. This includes both events with simultaneous low outputs and with concurrent high outputs.

Admitting their analysis does not cover the effects of future climate change on weather-dependent renewables, heating or cooling, the authors say future planned work includes comprehensive assessment of price and curtailment effects for various countries in Northern Europe. They also plan to examine the effects on achieved prices for hydropower and other power producers, plus the effects on socioeconomic surplus, including potential redistributions between countries or between producers and consumers. 

https://www.hydropower.org/news/flexible-energy-transition-gets-boost-as-over-58-nations-back-global-storage-and-grids-targets

https://www.hydropower.org/news/pumped-storage-hydropower-is-a-major-focus-in-australias-clean-energy-conversation

The value of hydropower flexibility for electricity system decarbonization by Yiwen Wang, Todd Levin, Jonghwan Kwon, and Erin Baker. Energy Reports 13 (2025) 2711–2721. https://doi.org/10.1016/j.egyr.2025.02.019

On the potential role of flexible Norwegian hydropower in managing challenging renewable energy variability events in Europe by Anders Arvesen et al 2025 IOP Conf. Ser.: Earth Environ. Sci. 1442 01200