Utility Week

14 | 27TH APRIL - 3RD MAY 2018 | UTILITY WEEK Policy & Regulation "It is a policy deficit in the UK that the generation market is not designed with bulk electricity storage in mind." Opinion Drew Hendry F or nearly 130 years, Scotland has been the home of hydroelectricity. Back in 1890, Fort Augustus in my constituency was an early adopter of the technol- ogy. This simple idea for generating power, using our geography, mountains and lochs, was going to transform the Highlands and give Scotland the lasting lead across the nations of the UK for hydropower. This year marks the 75th anniversary of the Hydro Electric Development Act, which really kick-started major hydro developments across Scotland. As a result, we have about 2GW of installed hydro- electricity capacity, accounting for around 88 per cent of all UK capacity and 92 per cent of UK hydro output. The really good news is that there are opportunities in abundance to develop even more. The technical side of hydro generation is fascinat- ing, but I will leave that to the experts. Pumped storage schemes are really clever though, involving two bodies of water at different heights and, during periods of low demand, electricity is used to pump water from the lower reservoir to the upper reservoir. When demand is high, the water is released to generate electricity – in a similar manner to conventional hydro – effectively acting as enormous batteries. Unlike actual batteries, however, they aren't just for short-term gaps but can ensure we can all brew a cup of tea during periods of variable demand. Pumped storage is one of the only technologies able to provide this flexibility to the system. When the wind is blowing, surplus energy from wind turbines can be stored, to be released when it's required and keeping supply constant. Hydro can mean downward pressure on wholesale electricity prices, avoiding payments for new build generation and power networks. That saving could and should benefit customers, espe- cially those who suffer higher charges just because of where they live. In a report commissioned by SSE, Baringa found that Coire Glas, a con- sented pumped storage plant in the Scot- tish Highlands, would deliver about £70 million per annum benefit in social wel- fare and a reduction in customers' bills of about £215 million per annum. Now that is something I can get excited about. Despite the benefits, new pumped storage has not been seen in Scotland for more than 40 years. Foyers began generating in 1974 and Cruachan in 1966, with both providing balancing services rather than long-term storage. Modern and more efficient pumped storage facilities should be part of our renewable energy mix. Pumped storage, like other large scale renewables generation, is a capital-intensive infrastructure invest- ment requiring a long lead time but, once developed, it has a long life with low operating costs. It is a policy deficit in the UK that the current genera- tion market is not designed with bulk electricity storage in mind, losing out to technologies that in my view are bad value, risky and have enormous legacy implications, such as new nuclear. SSE says that, at a stroke, Coire Glas would more than double the total pumped storage capacity not just in Scotland, but across the nations of the UK. An investment stabilisation mechanism, similar to the "cap and floor" currently available to interconnec- tors, could reinvigorate the pumped storage market and bring the hydro revolution back to Scotland. Projects are ready and waiting to go. We need to make maximum use of our own energy resources – it makes no sense to rely even more heavily on intercon- nection to ensure security of energy supply. SSE says that Coire Glas is a shovel-ready project. It could quickly be the first new pumped storage system in Scotland this century, but the twin vices of uncertainties in the UK government about future revenue streams and policy instability have prevented it from progressing. SSE received planning consent for Coire Glas, in the Great Glen, in December 2013, for up to 600MW installed capacity and 30GWh of storage – an £800 million pro- ject, with a construction period of around five years. It could run for over two days at full output, and even longer with a lower load. Moreover, it was wholeheart- edly supported by the local authority, community coun- cil, local councillors and Scottish ministers. With SSE now looking to increase the generating capacity of the project to 1,500MW to maximise the potential of the site, Coire Glas is best placed to deliver within the market. Supporting pumped storage, and projects like Coire Glas, will provide energy for people, families and communities far into the future. This long-established, proven technology generating low-carbon power is too important to languish on the sidelines. Drew Hendry, MP, Inverness, Nairn, Badenoch and Strathspey

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