AGL Energy and Idemitsu Australia Resources (IAR) have joined forces to undertake an engineering feasibility study for AGL's proposed 250MW pumped hydro project at Bells Mountain, near Muswellbrook.
AGL's executive general manager of group operations Doug Jackson recently signed a Memorandum of Understanding with IAR's managing director Naoki Kawamoto and chief commercial officer Chris Walsh.
The agreement follows on from an initial concept study, which explored the viability of utilising the void on the Muswellbrook Coal Company (MCC) site, which is no longer being mined and is suitable for the planned project.
The work, including design, engineering and geotechnical investigations, is expected to take up to 18 months.
Mr Jackson said the development had the potential to create jobs and provide an efficient source of electrical energy to the Hunter region.
"As we transition to more renewable energy sources, pumped hydro provides a reliable on demand generation source," he explained.
"Flexible power supply, like the energy that would be generated from the proposed project, has an extremely important role to play in an energy mix as it can be switched on to bolster energy when the community needs it.
"This project is yet another way AGL is investing in the Hunter and ensuring our customers have reliable and affordable energy services."
Pumped hydro works by circulating water from the lower reservoir in the mine void into an upper storage site.
Upon demand, water is released and uses gravity to turn turbines and generate electricity.
The feasibility study will assess whether the project is technically viable, provide cost estimates for both construction and operation and assess the required planning and approval processes.
Mr Kawamoto said MCC had been a mainstay in the community for 111 years.
The agreement also boasted the potential to continue providing economic and social benefits to the community by utilising one of the mine's voids, which is no longer being mined.
"Innovative rehabilitation solutions such as the reuse of mine voids for renewable energy generation can provide towns like Muswellbrook with a long term sustainable resource and attract further investment," he said.
"Coal will continue to be an important pillar of our business in Australia alongside our existing fuel and agricultural businesses, with this project being our first Australian renewable energy study project proceeding to a fully-fledged feasibility."
Mr Walsh explained Idemitsu Kosan, IAR's parent company, was a diversified energy player with significant interests in renewable power generation in Japan, including wind, solar PV generation, geothermal energy and biomass.
"IAR is continually looking for new opportunities to utilise its assets and diversify its energy mix for the benefit of shareholders and to promote the energy security of Australia and Japan," he said.
"We recognise the importance of our mining operations in the regional locations we operate in and we are exploring innovative rehab and sustainability solutions.
"On behalf of IAR, I thank AGL Energy and Muswellbrook Shire Council for their efforts in making this partnership a reality and I look forward to progressing the study over the coming months."
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