Pumped hydro involves using surplus energy to pump water uphill to a storage reservoir. The water can then be released downhill to generate electricity on demand.
The Australian Renewable Energy Agency has told Malcolm Turnbull pumped hydro could be the key to unlocking "cost-effective large-scale energy storage that can stabilise high levels of renewable energy in the national electricity grid", such as in South Australia.
"Pumped hydro is the only mature, bankable technology that is readily available at scale," ARENA chief Ivor Frischknecht said.
"However, the lead times are long. Most PHES projects take between four to seven years to develop and construct with the majority of cost associated with civil engineering and construction."