Pumped hydropower storage

Pumped hydropower storage is a technology that stores electrical energy by holding water at a higher elevation until the electrical system needs it, at which point it is released and converted back into electricity. It is, in essence, a large-scale natural battery.

Its operation is based on two reservoirs located at different heights, connected by a penstock (an enclosed pipe) and equipped with reversible turbines:

• When there is surplus electricity in the grid — for example, at noon when solar production is massive — that excess energy is used to pump water from the lower reservoir to the upper reservoir.
• When electricity demand rises, the water in the upper reservoir is released and it flows down the penstock to the turbines, where it generates an immediate and stable supply of electrical energy.

It's just like charging a battery: electricity is stored in the form of elevated water, and the water released from the upper reservoir is like the battery discharge. But in the case of pumped hydropower, it's gravity doing the work. There's no chemical reaction, no degradation, and no expiration date.

What makes this technology especially valuable is its dual purpose. Reversible hydraulic units serve as pumps when there is a surplus by storing energy and as turbines when there's demand by generating electricity. The same machine does both jobs, adapting in real time to what the system needs at any given moment.

We can add to this the speed of response: a pumping station can start and supply power in a matter of minutes, and even help restart the power grid after a total power outage, which is a procedure known as a black start. In terms of durability, pumped hydropower facilities can run for decades, with life cycles far exceeding those of other storage technologies, such as lithium-ion batteries.

Transmission and storage of hydropower take place in two separate but complementary areas. One is the transfer of water: penstocks and other conduits move water between the two reservoirs, whether pumping upward or flowing downward for generation. The other is electricity transmission: once generated in the hydropower plant, the electricity is sent to the transformers where its voltage is increased and transferred to the high-voltage power transmission lines that take it to the point of consumption. Storage, on the other hand, takes place in the upper reservoir itself, in the form of potential energy, waiting for the grid to need it.

According to the Ministry for the Ecological Transition and the Demographic Challenge, pumped hydropower plants are net consumers of electrical energy: they consume more electricity during pumping than they generate when water is released, entailing a loss in the process. Their value, however, lies not in gross energy efficiency but in the service they provide to the grid as a whole: capacity to store and regulate supply, shoring up supply security, and offering flexibility to integrate renewables.

This technology a key piece among the various energy storage solutions that Repsol is developing as part of our commitment to low-carbon generation.

The electrical system works on a principle of physics: the energy produced must be either consumed at that very moment or stored. There are no other options in this regard. Any imbalance between production and consumption affects the frequency and stability of the grid, with direct consequences for supply.

Renewable sources such as solar or wind generate electricity when there is sun or wind, not necessarily when there is demand. So, it's not a matter of whether they are capable of producing energy but what happens to that energy when the system does not need it at that precise moment.

To understand the scale of the challenge, think about what happens when you open the faucet and the water flows without anyone using it... it goes down the drain. The same thing happens with electricity, but without an actual drain. If there's no way to store electricity at the moment it is produced, it disappears. The difference is that you can't just turn off the faucet, because suddenly disconnecting a generation source affects the balance of the entire network.

The Aguayo reversible pumping station has 360 MW of installed capacity and an average annual production of 700 GWh. It uses the Alsa reservoir as the lower reservoir and the Mediajo reservoir as the upper reservoir: the two "terminals" of this natural battery.

Its role in the electrical system doesn't stop at electricity generation. It brings flexibility to the system, stabilizes frequency and the voltage of the grid, and acts as a firm backup in the event of sudden load or generation variations. Its synchronous technology contributes inertia to the system, acting as a buffer against the imbalances introduced by variable generation.

In energy terms, Aguayo acts as insurance: it absorbs the excess when there is surplus generation, releases stored energy when demand rises, and can respond to any system failure. 

Beyond the infrastructure itself, the expansion will have a direct economic impact on the region of Cantabria as the around €900 million being invested in the project will activate local supply chains and lay the foundation in terms of energy for industrial development in the region.

The 2025 Electricity System Report published by Spain's national grid operator, Red Eléctrica, backs up this figure with data: of Spain's 3,427 MW of total installed storage capacity, 3,331 MW correspond to pumped turbines and only 96 MW belong to batteries. However, both technologies do not compete: they complement one another. Batteries are best for short-term storage, while pumped hydropower lets us achieve seasonal storage and provides structural stability to the system.

The National Integrated Energy and Climate Plan (PNIEC) sets the goal of reaching 22.5 GW of installed storage capacity in Spain by 2030, combining pumping, batteries, and other technologies. Energy companies such as Repsol have up to 40 pumping projects underway in different phases of development, which could add an additional 15,000 MW of capacity.

Spain, with its mountainous terrain and its existing hydropower facilities, is uniquely positioned to take advantage of this potential. As for Aguayo, it's an example of how to expand an existing infrastructure's contribution with the least possible impact instead of building a whole new facility.

Aguayo II is part of Repsol's energy transition and sustainability strategy, which promotes renewable energy projects through Repsol Renovables in different parts of Spain.

When we turn on the light or charge the phone, we don't think about where that energy was 10 minutes ago. It could have been in the Mediajo reservoir in the form of elevated water, waiting for the moment when the grid needed it.

That's hydraulic storage: the silent guarantee that energy generated by wind or the sun is available when we need it, not just when nature produces it.

Aguayo has been demonstrating this technology's reliability for four decades. And with the expansion underway, it will do so on a scale that places it among the most relevant energy infrastructures in southern Europe.

Pumped hydropower storage is a technology that stores electrical energy by holding water at a higher elevation. When there is surplus electricity on the grid, that energy is used to pump water from the lower reservoir to another at a higher elevation. When the power demand rises, the water is allowed to flow downward, moving the turbine blades and generating electricity immediately. It is, in essence, a large-scale natural battery that doesn't degrade and has no expiration date.

Transmission and storage of hydropower take place in two separate but complementary areas. Penstocks and other conduits move water between the two reservoirs, whether pumping upward or flowing downward for generation. Once generated in the hydropower plant, the electricity is transferred to the high-voltage power transmission lines that take it to the point of consumption. Storage itself takes place in the upper reservoir itself, in the form of potential energy, waiting for the grid to need it.

Aguayo II is the expansion project for the Aguayo reversible pumping station in Cantabria, operational since 1982. The expansion will multiply its installed capacity from 360 MW to approximately 1,400 MW, making it the second largest pumping station in Spain, with an expected production of 2,000 GWh per year capable of supplying more than 800,000 homes.

The 2025 Electricity System Report published by Spain's national grid operator, Red Eléctrica, backs up this figure with data: of Spain's 3,427 MW of total installed storage capacity, 3,331 MW correspond to pumped turbines. The PNIEC sets the goal of reaching 22.5 GW of total storage capacity by 2030.

A Project of Common Interest (PCI) is a category reserved by the European Union for infrastructures that are key to the continent's energy integration. These projects contribute to the interoperability of electricity networks, security of supply, and the reduction of CO₂ emissions, and often have access to specific European funding, such as the Connecting Europe Facility.

Hydraulic pumping is geared towards seasonal and high-volume storage, with a lifespan of several decades and no significant degradation. Batteries are more effective for short-term storage. In Spain, both technologies complement one another: pumped hydro makes up 3,331 MW of the 3,427 MW of installed storage, while batteries cover more immediate response needs.

The construction of Aguayo II is expected to last more than four years, with a total investment of approximately €900 million and a peak of direct employment on-site of around 1,000 people.