By Aidan Kerr, Senior External Affairs Manager, Drax
Governments around the world are caught between a rock and a hard place: cutting carbon emissions while ensuring energy remains both secure and affordable.
This is known as the ‘energy trilemma’. Each of these three outcomes must be balanced to ensure that energy systems are resilient, efficient, and effective.
In the last decade, the UK has decarbonised its power grid faster than any other major economy largely due to the phasing out of fossil fuels and growth in wind and solar power. But what happens to our power grid when the wind doesn’t blow, or the sun doesn’t shine? How can we have a green grid but at the same time have secure power supplies at an affordable price?
At Drax, we believe pumped storage hydro is a critical technology which is perfectly placed to help solve this trilemma. It’s the only proven grid-scale technology which can store vast quantities of energy for long durations. These sites act like giant water batteries, using excess power from the grid to pump water to an upper reservoir where it is stored, before re-releasing it to generate electricity when demand requires.
Each year, the UK spends hundreds of millions of pounds constraining wind farms as there is either too much power being generated versus demand, or there are bottlenecks on the transmission system meaning it can’t be transported.
We can’t afford to let renewable power go to waste. That’s why Drax is progressing plans to build a new pumped storage hydro plant at our existing Cruachan Power Station in Argyll. Like the current plant, the new power station will be built underground inside Ben Cruachan. This will be done by creating a new hollowed-out cavern which would be large enough to fit Big Ben on its side.
Cruachan is preparing for its next chapter as the UK’s first pumped storage hydro scheme in 40 years. This project will more than double the site’s generating capacity to over a gigawatt, providing enough clean power for two million homes and businesses across Scotland and the UK.
This year marks 60 years of Cruachan keeping the lights on. It was the first reversible pumped storage hydro system on this scale to be built in the world. For more than half a century, Cruachan has delivered growth and opportunity for local communities. During the construction phase, the expansion is projected to support over 150 jobs in Argyll and Bute and over 500 jobs across the wider supply chain in Scotland. In total it will support 1,100 jobs across the UK.
In pumped storage hydro, we have a tried and tested solution to the energy trilemma, but unfortunately there are barriers to unlocking private investment in such transformational projects. While the UK’s policy and market support mechanisms have evolved to enable new build renewables, the current framework isn’t suitable for pumped storage projects.
Excitingly, there now appears to be light at the end of the tunnel. In one of his first acts as Energy Minister, Michael Shanks tasked Ofgem and NESO to develop a new ‘cap and floor’ support mechanism so these vital projects can move forward. This type of mechanism is not new to the UK energy sector, having already been used to support the roll-out of cross-border interconnectors over the last decade. It enables private equity to see the project’s maximum and minimum revenues over an extended period, reducing risk and uncertainty.
Over the coming months, Drax alongside the wider Scottish renewables industry will be engaging with Ofgem and NESO as they develop this mechanism. If delivered, this could be the beginning of an important new chapter in Scotland’s energy story.
We need big, bold solutions to solve the energy trilemma. Drax is ready to move mountains to make a more secure, affordable, and sustainable power grid.