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Risk Mitigation and Investability of a U-PHS Project in The Netherlands

Author

Listed:
  • Gert Jan Kramer

    (Copernicus Institute of Sustainable Development, Utrecht University, Princetonlaan 8a, 3584 CB Utrecht, The Netherlands)

  • Twan Arts

    (O-PAC Ontwikkelingsmij, Vrijthof 48, 6211 LE Maastricht, The Netherlands)

  • Janos L. Urai

    (Institute for Structural Geology, Tectonics and Geomechanics, RWTH Aachen University, Lochnerstrasse 4-20, D-52056 Aachen, Germany
    Geostructures—Consultancy for Structural Geology and Geomechanics, Hunnenweg 9, 6224 JN Maastricht, The Netherlands)

  • Han Vrijling

    (Department of Hydraulic Engineering, Delft University of Technology, Stevinweg 1, 2628 CN Delft, The Netherlands)

  • Jan M. H. Huynen

    (Sogecom B.V., Vrijthof 48, 6211 LE Maastricht, The Netherlands)

Abstract

We review the status of a 1.4 GW, 8 GWh underground pumped hydro storage (U-PHS) project in the southern Netherlands, which has been under development since the 1980s. Its history shows how the prospect of a large-scale U-PHS for The Netherlands (a country whose proverbial flatness prohibits PHS) has been attractive in every decade, based on proven technology in a subsurface location with validated properties, and solid analysis of its economics. Although the ongoing energy transition clearly requires massive electricity storage, (U-)PHS projects are challenging investment propositions, in The Netherlands, as elsewhere. This case study illustrates a point of general relevance, namely that although the project execution risk, related to uncertainty with respect to subsurface integrity, is very low, the transition risk, associated with the intrinsic uncertainties of an electricity system in transition, is significant. We point out mitigation strategies for both risk categories.

Suggested Citation

  • Gert Jan Kramer & Twan Arts & Janos L. Urai & Han Vrijling & Jan M. H. Huynen, 2020. "Risk Mitigation and Investability of a U-PHS Project in The Netherlands," Energies, MDPI, vol. 13(19), pages 1-18, September.
    • Handle: RePEc:gam:jeners:v:13:y:2020:i:19:p:5072-:d:420695
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    References listed on IDEAS

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    1. Kraan, Oscar & Kramer, Gert Jan & Nikolic, Igor & Chappin, Emile & Koning, Vinzenz, 2019. "Why fully liberalised electricity markets will fail to meet deep decarbonisation targets even with strong carbon pricing," Energy Policy, Elsevier, vol. 131(C), pages 99-110.
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