Pumped-storage hydroelectricity (PSH), or pumped hydroelectric energy storage (PHES), is a type of hydroelectric energy storage used by electric power systems for load balancing. The method stores energy in the form of gravitational potential energy of water, pumped from a lower elevation reservoir to a higher elevation. Low-cost surplus off-peak electric power is typically used to run the pumps. During periods of high electrical demand, the stored water is released through turbines to produce electric power. Although the losses of the pumping process make the plant a net consumer of energy overall, the system increases revenue by selling more electricity during periods of peak demand, when electricity prices are highest. If the upper lake collects significant rainfall or is fed by a river then the plant may be a net energy producer in the manner of a traditional hydroelectric plant.
Pumped-storage hydroelectricity allows energy from intermittent sources (such as solar, wind) and other renewables, or excess electricity from continuous base-load sources (such as coal or nuclear) to be saved for periods of higher demand. The reservoirs used with pumped storage can be quite small when contrasted with the lakes of conventional hydroelectric plants of similar power capacity, and generating periods are often less than half a day.
Pumped storage is by far the largest-capacity form of grid energy storage available, and, as of 2020, the United States Department of Energy Global Energy Storage Database reports that PSH accounts for around 95% of all active tracked storage installations worldwide, with a total installed throughput capacity of over 181 GW, of which about 29 GW are in the United States, and a total installed storage capacity of over 1.6 TWh, of which about 250 GWh are in the United States. The round-trip energy efficiency of PSH varies between 70%–80%, with some sources claiming up to 87%.
The main requirement for PSH is hilly country. The global greenfield pumped hydro atlas lists more than 600,000 potential sites around the world, which is about 100 times more than needed to support 100% renewable electricity. Most are closed-loop systems away from rivers. Areas of natural beauty and new dams on rivers can be avoided because of the very large number of potential sites. Some projects utilise existing reservoirs (dubbed "bluefield") such as the 350 Gigawatt-hour Snowy 2.0 scheme under construction in Australia. Some recently proposed projects propose to take advantage of "brownfield" locations such as disused mines such as the Kidston project under construction in Australia.
Water requirements for PSH are small: about 1 gigalitre of initial fill water per gigawatt-hour of storage. This water is recycled uphill and back downhill between the two reservoirs for many decades, but evaporation losses (beyond what rainfall and any inflow from local waterways provide) must be replaced. Land requirements are also small: about 10 hectares per gigawatt-hour of storage, which is much smaller than the land occupied by the solar and windfarms that the storage might support. Closed loop (off-river) pumped hydro storage has the smallest carbon emissions per unit of storage of all candidates for large-scale energy storage.