Drax plans 600 MW of new pumped storage in Scotland

UK power producer Drax Group Plc (LON:DRX) on Thursday announced the start of a planning process to build a new 600-MW underground pumped storage hydropower station in Scotland.

The proposed project will more than double the power generation capacity at the company’s Cruachan facility, which currently stands at 440 MW. The new plant will be built within a new, hollowed-out cavern inside Argyll’s highest mountain -- Ben Cruachan.

Drax said it seeks consent under Section 36 of the Electricity Act 1989 from Scottish ministers and it usually takes about a year to conclude that process. It will start with a public consultation from July 1, to be followed by the submission of an application to Scottish ministers in early 2022.

The company, though, noted that it also needs an updated policy and market support mechanism from the UK government in order to proceed with the project because it currently cannot secure private investment for new pumped storage hydro projects. Such plants have not been built in the UK since 1984.

“Last year, the UK’s lack of energy storage capacity meant wind farms had to be paid to turn off and we lost out on enough renewable power to supply a million homes. We need to stop renewable power from going to waste by storing it, and Drax is ready to move mountains to do just that,” said Will Gardiner, Drax Group CEO.

With Section 36 consent and an updated revenue stabilisation mechanism, work on the project could get underway in 2024. The company hopes to have the plant up and running in 2030.

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