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An Optimized Dynamic Benefit Evaluation Method for Pumped Storage Projects in the Context of the “Dual Carbon” Goal

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  • Cong Feng

    (Hubei Key Laboratory of Construction and Management in Hydropower Engineering, China Three Gorges University, Yichang 443002, China
    Department of Civil Engineering, Henan Polytechnic Institute, Nanyang 473000, China
    College of Economics and Management, China Three Gorges University, Yichang 443002, China)

  • Qi Guo

    (Hubei Key Laboratory of Construction and Management in Hydropower Engineering, China Three Gorges University, Yichang 443002, China
    College of Hydraulic and Environment Engineering, China Three Gorges University, Yichang 443002, China)

  • Qian Liu

    (Hubei Key Laboratory of Construction and Management in Hydropower Engineering, China Three Gorges University, Yichang 443002, China)

  • Feihong Jian

    (Hubei Key Laboratory of Construction and Management in Hydropower Engineering, China Three Gorges University, Yichang 443002, China
    College of Hydraulic and Environment Engineering, China Three Gorges University, Yichang 443002, China)

Abstract

With the rapid development of a new power system under the “dual carbon” goal, pumped storage has gained increasing attention for its role in integrating renewable energy and enhancing power system flexibility and security. This study proposes a dynamic benefit evaluation method for pumped storage projects, addressing the limitations of static analyses in capturing the evolving benefit trends. In this paper, the multi-stage dynamic benefit evaluation model was constructed by introducing time-of-use tariffs, periodic capacity pricing mechanism, and ancillary service revenue prediction based on machine learning and the multiple regression method. Sensitivity analysis was applied to explore the impact of key parameter variations on economic indicators. The results show that the benefit structure differs significantly across stages, and with electricity market development, a diversified pattern supported by electricity, capacity, and ancillary service revenues will emerge. The application of the model to an actual operating pumped storage power station yielded an internal rate of return of 8.18%, a payback period of 16.4 years, and a 26% increase in net present value compared with traditional methods. The proposed model expands the theoretical framework for pumped storage benefit evaluation and provides strong support for investment decisions, policy design, and operational strategy optimization.

Suggested Citation

  • Cong Feng & Qi Guo & Qian Liu & Feihong Jian, 2025. "An Optimized Dynamic Benefit Evaluation Method for Pumped Storage Projects in the Context of the “Dual Carbon” Goal," Energies, MDPI, vol. 18(11), pages 1-27, May.
  • Handle: RePEc:gam:jeners:v:18:y:2025:i:11:p:2815-:d:1666782
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    References listed on IDEAS

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    1. Yudong Tan & Guosheng Xie & Yunhao Xiao & Yi Luo & Xintao Xie & Ming Wen, 2022. "Comprehensive Benefit Evaluation of Hybrid Pumped-Storage Power Stations Based on Improved Rank Correlation-Entropy Weight Method," Energies, MDPI, vol. 15(22), pages 1-17, November.
    2. Tian, Bingying & He, Yongxiu & Zhou, Jinghan & Wang, Bingwen & Wang, Yi & Shi, Wenran, 2023. "Cost-sharing mechanisms for pumped storage plants at different market stages in China," Renewable Energy, Elsevier, vol. 217(C).
    3. Papadakis C. Nikolaos & Fafalakis Marios & Katsaprakakis Dimitris, 2023. "A Review of Pumped Hydro Storage Systems," Energies, MDPI, vol. 16(11), pages 1-39, June.
    4. Anwar, Ahsan & Siddique, Muhammad & Eyup Dogan, & Sharif, Arshian, 2021. "The moderating role of renewable and non-renewable energy in environment-income nexus for ASEAN countries: Evidence from Method of Moments Quantile Regression," Renewable Energy, Elsevier, vol. 164(C), pages 956-967.
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    6. Yan Lu & Xuan Liu & Yan Zhang & Zhiqiao Yang & Yunna Wu, 2023. "Investment Efficiency Assessment Model for Pumped Storage Power Plants Considering Grid Operation Demand under Fuzzy Environment: A Case Study in China," Sustainability, MDPI, vol. 15(11), pages 1-23, May.
    7. Yinguo Yang & Ying Yang & Qiuyu Lu & Dexu Liu & Pingping Xie & Mu Wang & Zhenfan Yu & Yang Liu, 2024. "Comprehensive Evaluation of a Pumped Storage Operation Effect Considering Multidimensional Benefits of a New Power System," Energies, MDPI, vol. 17(17), pages 1-16, September.
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