The Australian Renewable Energy Agency (ARENA) has approved a $450,000 pumped hydro energy storage project for South Australia.

While a political fight using SA power as a platform continues to rage, clean energy advocates are addressing the most significant failing of modern electricity systems – grid-based storage.

The ARENA grant will cover a feasibility study into a project that EnergyAustralia says will produce up to 100 megawatts (MW) of electricity with six to eight hours of storage.

It is the equivalent of installing about 60,000 home battery storage systems, but just a third of the cost.

In pumped hydro storage systems, water is pumped from a lower reservoir into a higher reservoir in off-peak times when energy is cheap.

The water is then dropped back downhill through a turbine to create electricity during times of high demand.

EnergyAustralia says that if the project goes ahead, pumped hydro power could be fed into the grid by 2020/21.

The Melbourne Energy Institute assessed the early stages of the idea, while engineering and design firm Arup has worked on tweaking pumped hydro technology to use seawater in Australia’s dry conditions.

Once complete, the Spencer Gulf project would be the largest seawater pumped hydro project in the world.