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Modular Pumped Storage – Feasibility and Economic Analysis

Project Details

Funding Source
Department of Energy (DOE)
Start Date
End Date
Ludington Pumped Storage Facility
Ludington Pumped Storage Facility - Photo courtesy of Consumers Energy


Development of global and domestic pumped storage hydropower (PSH) has traditionally focused on construction of large, highly customized plants that provide more than 100 MW of electricity. However, these plants are costly and face significant challenges. Therefore, alternative designs in PSH technology that are smaller and modular are gaining wider interest. 

Small modular PSH (or m-PSH) could be more cost-competitive and reduce many of the barriers facing conventional designs, such as access to capital, the long and uncertain licensing process, and the suppression of market prices and subsequent revenues caused by adding utility-scale storage to the grid.

The US Department of Energy’s Oak Ridge National Laboratory researchers worked to develop a cost/benefit resource tool that assesses the cost and design dynamics of m-PSH; weighs the benefits against economies of scale inherent in utility-scale development; and measures the economic competitiveness of m-PSH against alternative distributed storage technologies, such as batteries.


Researchers developed case studies to explore unique m-PSH designs, created a cost-modeling tool to quantify the cost of developing m-PSH projects on undeveloped sites, evaluated the requirements and feasibility of scaling various m-PSH technology applications, and determined the technological feasibility and economic viability of m-PSH. The studies revealed that small-scale, m-PSH systems are largely not cost-effective under current market conditions, but additional technology advancements could improve feasibility. The study’s results are documented through a report on the feasibility and viability of m-PSH and a report on a predictive cost methodology for m-PSH.

Impact/Intended Impact

From its research, the project team developed a general cost estimate for m-PSH projects with installed capacities of less than 100 MW. The team characterized the challenges inherent to m-PSH projects and technologies and evaluated the cost reduction opportunities for different m-PSH project types.

This resource may allow industry and the US Department of Energy’s Water Power Program to make an informed evaluation of the feasibility, risks, and potential benefits of pursuing an R&D strategy to reduce the cost of PSH development through modularization.