On June 13, 2022, Ding Yanzhang, Secretary of the Party Committee and Chairman of Power Construction Corporation of China, published a signed article "Developing Pumped Storage to Promote Green Development", stating that the "Double Two Hundred Project" will be implemented during the 14th Five-Year Plan period, which will be 200 cities and counties have started construction of more than 200 pumped storage projects with a target of 270 million kilowatts.

As a state-owned power company, China Electric Power Construction Group Co., Ltd. is the largest builder of pumped hydro storage in China. Ding Yanzhang also revealed that among the key projects implemented in the 14th Five-Year Plan, China Electric Power Construction Group Co., Ltd. has undertaken more than 85% of the project survey and design work.

As of the end of 2020, China's installed capacity of pumped storage is only 31.49 million kilowatts. This means that during the 14th Five-Year Plan period, China's pumped storage capacity will reach more than 8 times the total installed capacity in the past. According to the investment standard of about 6,000 yuan per kilowatt per kilowatt, the 270 million kilowatt project will drive about 1.6 trillion yuan of investment.

This goal goes far beyond previously released policy plans.

In September 2021, the "Medium and Long-Term Development Plan for Pumped Storage (2021-2035)" issued by the National Energy Administration made it clear that by 2025, the total production scale of pumped storage will double from the 13th Five-Year Plan, reaching more than 62 million kilowatts. ; By 2030, the total scale of pumped-storage production will double again from the 14th Five-Year Plan, reaching 120 million kilowatts.

The "14th Five-Year Plan for Modern Energy System" released in March 2022 proposes that by 2025, the installed capacity of pumped storage energy will reach more than 62 million kilowatts, and the installed capacity under construction will reach about 60 million kilowatts. This target also exceeded market expectations. Previously, the industry estimated that by 2030, China's total installed capacity of pumped storage will reach 113 million kilowatts.

There are early signs of increased investment in pumped hydro storage. On May 31, the State Council issued a notice on a package of policy measures to stabilize the economy, proposing to focus on the deployment of a number of pumped storage power stations that have a strong role in ensuring the security of the power system, a large role in promoting the large-scale development of new energy, and relatively superior economic indicators. , to speed up the construction of mature projects. This policy document has clearly released a signal to accelerate the pace of pumped storage development.

Then, on June 10, the National Energy Administration held a video conference to promote the development and construction of pumped storage projects, to implement the State Council's package of policies and measures to stabilize the economy and to promote the high-quality development of new energy in the new era. Understand, clarify tasks, deploy work, accelerate the development and construction of pumped storage projects, and promote high-quality development of pumped storage.

The continued increase in pumped hydro storage is the result of a combination of factors.

On the one hand, China's pumped storage development has been lagging for a long time. As early as 2009, China proposed a development goal of 110 million kilowatts of installed capacity by 2020. However, by the end of 2020, the actual scale of pumped storage construction was less than 1/3 of the planned target. Today's overweight, in a sense, is making up for the backwardness of the past.

On the other hand, the "dual carbon" goal provides a new opportunity for the development of pumped hydro storage. In this regard, Chairman Ding Yanzhang also elaborated in the article "Developing Pumped Storage to Promote Green Development". The development of pumped storage and the improvement of the flexible adjustment capability of the power system are the key to building a new power system with new energy as the main body. It is conducive to ensuring the orderly exit of traditional energy, realizing large-scale safe and reliable replacement of new energy, and promoting green and low-carbon development.

One is to promote the large-scale development of new energy. Pumped storage can provide flexible adjustment capabilities for large-scale, high-proportion, and base-based new energy development. It is an indispensable stabilizer for power systems and is globally recognized as the most effective means of supporting wind, solar and other new energy development.

The second is to effectively improve the level of new energy security. New energy sources such as wind and light have the characteristics of intermittent and randomness. It is urgent to build a batch of regulated power supplies with the characteristics of rapid response, controllable technology, economic advantages, energy saving and environmental protection, and large-scale application, so as to effectively guarantee the different development of our country. stage of energy security. Pumped storage has the functions of peak regulation, valley filling, and energy storage. It is the most mature, economical, low-carbon and safe regulating power source in the power system that has been tested in practice. Accelerating the construction of pumped storage is of great value for ensuring the safety and reliability of energy alternatives and building new power systems.

The third is to create a new growth point for the energy industry. Pumped storage projects can stimulate the development of related industries such as building materials and electrical equipment, and provide strong support for stabilizing growth and promoting investment. The construction of the pumped storage project will promote the development of new business formats such as "pumped storage + health care" and "pumped storage + cultural tourism", forming a new growth point for the energy industry.

However, the big development of pumped storage still needs to face some long-standing problems.

Profitability and business model have been the biggest constraints. In order to fundamentally solve the problem, in May 2021, the National Development and Reform Commission issued the "Opinions on Further Improving the Price Formation Mechanism for Pumped Storage Energy", which clarified that the electricity price should be formed in a competitive manner, and the capacity electricity price should be included in the transmission and distribution price recovery. The connection of market construction and development will gradually promote the entry of pumped storage power stations into the market, focus on improving the scientificity, operability and effectiveness of the electricity price formation mechanism, and give full play to the role of electricity price signals. The "14th Five-Year Plan for Modern Energy System" once again emphasizes "improving the pricing mechanism for pumped storage".

Based on the opinions of industry experts, first, the new electricity price policy is expected to make enterprises investing in pumped storage energy storage profitable; second, pumped storage energy storage will still not have excess profits in the future, but it can bring long-term and stable investment returns.

Another major factor restricting the development of pumped storage is ecological problems.

The northwest and northern regions of China, which are rich in wind and light resources, are often also water-scarce regions, and the entire "Three North" regions are in the cold zone and have freezing problems. The difficulty and investment cost of pumped storage construction are much higher than those in East China. and the Southwest. At present, more than 1/3 of the installed capacity of pumped hydro storage in China is located in East China.

Chairman Ding Yanzhang proposed in the article "Developing Pumped Storage to Promote Green Development": Give full play to the supporting role of pumped storage in the development of large bases, and actively promote the integration of water, wind, solar and storage bases in Southwest China, Northwest deserts, Gobi, deserts, etc. Development and construction of wind-solar storage clean energy bases. Editor/He Yuting