C2: Pumped Storage Development and Construction

Presentations are:

Overcoming Challenges in Feasibility level Design of Underground Complexes for Pumped Storage Hydroelectric Facilities, presented by Mark Ramsey, Mott MacDonald

Getting Real: Let’s Stop Playing Games And Bring Reality To Hydropower and Pumped Storage Project Estimates, presented by Warren Paul, Kiewit Infrastructure Engineers

Improving Pumped Storage Hydropower Project Outcomes Through a Contractor-Led FEED Process, presented by Nick Macrae, Bechtel


Details about each presentation and the speakers are below:

Overcoming Challenges in Feasibility level Design of Underground Complexes for Pumped Storage Hydroelectric Facilities, presented by Mark Ramsey, Mott MacDonald

The design of large underground complexes for pumped storage hydroelectric projects is well established and similar to the design of many other underground facilities. With the current global market conditions completion of traditional feasibility level design for large underground facilities have to overcome a number of challenges with not having complete geotechnical data due to schedule, financial, permitting and funding constraints to completing all geotechnical investigations and or exploratory adits or shafts. Geotechnical uncertainties that present a risk to the design and construction of these underground facilities are being postponed to further in the design phase, and often completed concurrently with procurement of a Contractor.

The presentation focuses on how the challenges to completing geotechnical investigations to inform feasibility studies that owners and developers face impact feasibility level design, funding appropriation and project sanction, procurement and construction. It specifically covers how preliminary feasibility level designs have to rely heavily on precedent experience, experience with expected construction means, methods and sequencing. How the collective heavy civil construction experience of owners, developers and consulting engineers have a significant impact on the accuracy of a Feasibility level cost estimate that is typically produced in advance of Contractor engagement.

Getting Real: Let’s Stop Playing Games And Bring Reality To Hydropower and Pumped Storage Project Estimates, presented by Warren Paul, Kiewit Infrastructure Engineers

Worldwide, the statistics on cost overruns for dams, both hydroelectric and non-hydroelectric are stunningly bad. The mean cost overruns compared to the estimates upon which go/no go business decisions are made are displayed below, based on Flyvbjerg and Gardner [1]: Dam Project Type Mean Cost Overrun Projects with 50% or Greater Cost Overrun Mean Overrun of Projects with 50% or Greater Cost Overrun Hydroelectric 75% 37% 186% Non-Hydroelectric 71% 33% 202% As an industry, we must do better; we must overcome the pressures to start projects on the wrong foot and put more honesty into our initial budgets and schedules. We try to be honest and transparent with our environmental impact assessments and statements. Why not bring this honesty and transparency to our cost estimates and baseline schedules? This paper will discuss the pressures on project proponents to not be fully honest with cost estimates and schedules. Solutions/methodologies to achieve reliable numbers will be suggested. Finally the benefits of honesty and transparency for pumped storage is discussed. [1] How Big Things Get Done by Bent Flyvbjerg and Dan Gardner, © 2023 by Connaught Street Inc. and Bent Flyvbjerg, Published by Random House. Improving Pumped Storage Hydropower Project Outcomes Through a Contractor-Led FEED Process, presented by Nick Macrae, Bechtel

As the world shifts away from fossil fuels and transitions to low-carbon alternatives, hydropower and pumped storage are becoming increasingly critical solutions to support global energy transition and grid resilience, as the proportion of variable renewables increases. However, large hydropower projects have historically required considerable upfront capital costs and lengthy construction periods, and developers and utilities considering these projects must demonstrate the return on investment to access finance for the capital expenditure. Despite the recognition of the growing need for hydropower, the current delivery model will not meet the urgent demand for energy storage capacity. As a result, the industry risks missing this opportunity for a hydropower renaissance if the market continues to favor other quicker forms energy storage solutions or simply resorts to building more power generation.

Major complex infrastructure projects are driven by risks and the confidence that those risks can be effectively mitigated and managed. One way to address these challenges on projects with high design and construction uncertainty is by undertaking a contractor-led front-end engineering design (FEED). This approach ensures that the project is designed with constructability and operability in mind, preventing surprises during implementation and operation. By focusing constructability and mitigating interface risk, a contractor-led FEED can also significantly improve cost and schedule outcomes, ultimately supporting the economic viability of pumped storage solutions.

This session explores the benefits of developing projects with a contractor-led FEED, including implementing innovative and modern construction methods early in the project lifecycle and instilling early collaboration with supply chain partners. We will also discuss examples from other industries where contractor-led FEEDs have been successfully adopted.