An Exploratory Economic Analysis of Underground Pumped-Storage Hydro Power Plants in Abandoned Coal Mines

FCN Working Paper No. 2/2013

34 Pages Posted: 5 Nov 2013  

Reinhard Madlener

RWTH Aachen University

Jan Martin Specht

RWTH Aachen University

Date Written: February 2013


In Germany, the mitigation of CO2 emissions as well as the nuclear power phase-out are important political goals in the course of the sustainable energy transformation process (so-called “Energiewende”). The reduction in fossil- and nuclear-based energy supply has to be compensated by new renewable energies, especially wind power and photovoltaics. Most of the existing studies find that such an increasing contribution from volatile renewables calls for an intensified use of massive energy storage. Conventional technologies for this purpose are pumped-storage hydro power (PSHP) facilities. Typically, these require a storage reservoir on top of a mountain and another one at the bottom. In Germany, unfortunately, suitable sites are quite rare and the constructional measures often have a negative impact on the landscape and the ecosphere, which often induces public resistance. A possible future solution might be the use of underground PSHP (UPSHP) plants, for example, in closed-down mines. This study constitutes an early attempt to model such plants, in order to assess and better understand the economic viability of such underground UPSHP power plants in closed down coal mines. First, we examine the topic from a technical perspective, which is followed by an economic analysis. In the technical assessment, we analyze the feasibility of building an underground reservoir, installing the pressure pipes in the main shaft and equipping the machine cavern with turbines and pumps. In the economic examination, the expected costs for building a UPSHP are calculated. A rough comparison between the costs of a classic and a UPSHP plant is made that also includes the costs of redesigning and reconstructing the underground reservoir. Based on the techno-economic evaluation, we conclude that under favorable conditions the realization of UPSHP plants seems both technically feasible and economically reasonable. More specifically, an extension of a tube system seems the most promising option. We also find that a PSHP plant in a mine shaft is probably slightly more expensive than a conventional one, an outcome that depends strongly on the feasible head. Also, the significant reduction of the adverse impacts on the landscape and local residents could be an advantage. In addition, the number of potential sites might be quite large compared to those for conventional PSHP plants.

Keywords: hydro power, pumped storage, coal mining, reservoir engineering, massive energy storage

Suggested Citation

Madlener, Reinhard and Specht, Jan Martin, An Exploratory Economic Analysis of Underground Pumped-Storage Hydro Power Plants in Abandoned Coal Mines (February 2013). FCN Working Paper No. 2/2013 . Available at SSRN: or

Reinhard Madlener (Contact Author)

RWTH Aachen University ( email )

School of Business and Economics / E.ON ERC
Mathieustraße 10
Aachen, 52074
+49 241 80 49 820 (Phone)
+49 241 80 49 829 (Fax)


Jan Martin Specht

RWTH Aachen University ( email )

Templergraben 55
52056 Aachen, 52056

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