Economic feasibility of Pumped Hydropower Storage in a European open-pit lignite mine

Addressing the challenges of sustainable energy transition and resource repurposing by transforming open-pit coal mines into Hybrid Pumped Hydropower Storage (HPHS) facilities remains highly relevant. While numerous studies have explored the technical and economic feasibility of PHS, few have assessed site-specific economic risks in repurposing exhausted lignite mines for HPHS. A dynamic techno-economic simulation model was applied to evaluate the financial benefits of a potential 1,107 MWh installation in a exhausted Greek lignite mine. This study combines a dynamic simulation model with historical market data and structured risk assessment to demonstrate the financial viability of HPHS in repurposed lignite mine sites. Charging and discharging schemes were derived from historical energy market data. A retrospective simulation for the period of 2015–2024, based on site-specific parameters, was used to calculate revenues, expenditures, and profits. The simulated operation in the Greek energy market shows an average price spread of 55 €/MWh over the years 2022–2024. This results in the key indicators Net Present Value (112.33 M€), Internal Rate of Return (5.65%), Discount Payback Period (12 years), and Levelised Cost of Storage (54-61 €/MWh), all of which confirm financial viability over a 30-year operational period. A positive Net Present Value is already achieved based on an average annual energy price spread of approximately 37.28 €/MWh. The undertaken sensitivity analysis highlights the importance of economic planning and cost management. HPHS projects can provide economic energy storage solutions and benefit from stable policy support, such as feed-in tariffs and subsidies. • Study shows economic feasibility of 1,100 MWh hydropower in Greek lignite mine. • Storage cost ranges between 54 and 61 €/MWh. • Repurposed mines enable utility-scale energy storage with positive economics. • Sensitivity analysis underlines role of planning and supportive energy policy.