The Economic Feasibility of Pumped Storage Hydropower
Dilley, Lisa Dilley
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There is little general modeling research available for evaluating new PSH proposed for development from an economic point of view. This modeling framework enables the analyst to evaluate hypothetical pumped-storage within the generation fleet that it would be built in with limited data requirements on the front end. Using nonlinear optimization, a simulation model is developed that demonstrates the potential effects of storage on an existing generation system. It is shown that these simulation results reproduce analytical economic efficiency conditions, which gives specific insight to the sensitivity of PSH to design choices and wind statistics. It is shown that system marginal cost and total cost can be reduced through operations policies. These results also inform the need for additional data and detailed modeling in the feasibility stages of design.