SSE Renewables has announced it is planning to convert the 152MW Sloy hydropower Station into a pumped storage facility, with the transformed facility expected to deliver up to 25GWh of long-duration electricity storage capacity, enabling it to provide firm and flexible renewable energy for up to 160 continuous hours.

The announcement was made during a visit by Scotland's First Minister, Humza Yousaf, as part of the 80th-anniversary celebrations of the 1943 Hydro Electric Development (Scotland) Act, which pioneered hydroelectric power in the Scottish Glens. SSE's decision comes as the company awaits the UK Government's decision on supporting long-duration electricity storage, as outlined in the "British Energy Security Strategy" released last year.

Minister Yousaf highlighted the significance of facilities like Sloy Power Station in ensuring a resilient and secure electricity supply, especially during periods when renewable energy generation fluctuates: “ Hydro power was the country’s original source of renewable energy and it has the potential to play a significantly greater role in the transition to net zero – both on a small-scale in co-operation with local communities and on a larger scale, to help to ensure a continued resilient and secure electricity supply.”

Yousaf called for appropriate market mechanisms to support hydro power and other long-duration energy storage technologies, leveraging Scotland's abundant natural resources in renewable energy production.

Director of Onshore Europe at SSE Renewables, Finlay McCutcheon, expressed excitement about the redevelopment plans, emphasizing the need for large-scale, long-duration electricity storage to be part of the country's future energy mix.

“With up to 25GWh of storage capacity, the scheme would be capable of powering 90,000 homes for an entire week, so bolstering our energy security and providing the balancing flexibility we need in a renewables-led energy system,” he said. “The development of pumping capability at Sloy also complements our development plans for our other pumped hydro storage project at Coire Glas. Taken together and if approved for delivery, Coire Glas and Sloy can treble Britain’s current flexible electricity storage capacity. That’s why it’s crucial the UK Government urgently confirms its intention on exactly how they will help facilitate the deployment of pumped hydro storage projects as part of our future energy mix."

SSE Renewables' pumped storage plans for Sloy coincide with their proposed pumped hydro storage scheme at Coire Glas, which has the potential to become Britain's largest pumped hydro storage scheme in four decades, with an estimated investment exceeding £1.5 billion.

The future of pumped hydro storage projects, including Sloy, will depend on revenue certainty and the upcoming decision by the UK Government on long-duration electricity storage support. The introduction of a revenue stabilization mechanism, such as an adapted 'cap and floor' scheme, is expected to encourage investment in long-duration storage without the need for subsidies. The value of low-carbon, flexible assets like pumped storage in the electricity market, including the Capacity Market and Flexibility Markets, will also be assessed.

SSE Renewables will now refine the project design for converting the iconic Sloy plant into a pumped hydro storage facility, followed by a period of public consultation later this year. Pending a positive consenting outcome and a supportive policy environment, the company aims to make a final investment decision by late 2025 and complete the adaptation and commissioning of the new pumped storage scheme by 2028.

If approved, the project will require a high tens-of-millions-of-pounds investment and contribute to SSE's Net Zero Acceleration Programme, which involves investing around £7 million per day in critical low-carbon infrastructure necessary for the net-zero transition. SSE will provide further updates on its investment plans alongside its full-year results announcement on Wednesday.