#IHA30 - The next frontier for pumped storage: How the Superhybrid model could reshape energy markets
As part of the ýý 30th anniversary series, we’re showcasing the forward-thinking approaches that will shape the next 30 years of sustainable hydropower. In this guest article, Chris Baker, Founder and CTO of Sunshine Hydro, shares a bold vision for how combining pumped storage hydropower with complementary technologies – in what he calls the “Superhybrid” model – could unlock long-duration storage, reduce project risk, and reshape energy economics for a net zero future.
The ýý (IHA) Guidance Note on De-risking Pumped Storage Hydropower (PSH) Investment is a timely and critical analysis. It highlights a structural contradiction in todayý energy transition: while long-duration energy storage is essential to balance the growing share of variable renewables, PSH – our most mature option – remains stalled by high upfront risk, long lead times and opaque revenue predictions.
IHAý diagnosis is clear-eyed. PSH is indeed challenging. Its development cycle is slow. Its financial return pathways remain uncertain. These are not failures of vision, but reflections of an energy ecosystem in flux, where no single technology – no matter how technically sound – can succeed in isolation. This is precisely where the “Superhybrid” model offers transformative potential.
The Superhybrid is a systemic rethinking of energy deployment. Rather than building assets as discrete projects, the Superhybrid brings together complementary technologies like solar, wind, green methanol and PSH into a unified architecture. In this model, PSH is not a standalone asset forced to justify its economics on narrow market arbitrage. Instead, it becomes the stabilising engine of a broader climate resilience platform. The Superhybrid works like a conductor and an orchestra to produce harmonious energy out of variable parts.
Consider one of IHAý core and justifiable concerns: the failure of PSH projects to reach Final Investment Decision (FID), largely due to front-loaded capital exposure and limited long-term revenue certainty needed for capital repayment. On the other hand, many studies have shown the enormous value that PSH brings to an energy market – however, the mechanism to capture this value is missing.
In a Superhybrid, the PSH installation gets rewarded with far greater and certain revenue streams than market arbitrage. Currently the risk of building a standalone PSH project is with the developer/owner, and the lion's share of the reward is to the broader energy grid. The Superhybrid revenue design uses existing market mechanisms, cleverly but simply structured to deliver the reward back to the risk taker, where it surely belongs.
Equally important is the question of grid needs and market design. IHA rightly calls for national storage masterplans and tailored policy support. Yet in many jurisdictions, such frameworks remain nascent or fragmented. A Superhybrid provides a template for matching variable renewable energy with dispatchable load and storage, to turn this into reliable 24/7 power, which is, after all, just what the consumer needs.
By demonstrating the real-world value of PSH within a functioning ecosystem, the Superhybrid provides the kind of grounded proof policymakers and financiers often need to commit political and monetary capital.
Project development risk is another area the Guidance Note flags. Site-specific uncertainties –such as geological conditions, topography, water rights or community engagement – can derail even well-intentioned efforts. When combined with an uncertain revenue stream of a standalone PSH, this is enough to derail even the best projects. However, providing a strong bankable long-term revenue stream is what a PSH project needs to balance the project development risk profile.
Crucially, the Superhybrid aligns with IHAý emphasis on thoughtful risk allocation. Rather than burdening any one player – be it developer, contractor or public agency – with outsized exposure, the Superhybrid aligns the value that is created by PSH with the risk taker. Revenue streams can be co-designed and cross-collateralised across the asset suite, reducing dependency on volatile merchant markets or delayed policy signals.
When the physical and contractual elements are properly sized to match weather patterns, and existing energy market designs, it makes wind and solar energy fully dispatchable. This stacks together the revenue streams that are normally associated with baseload power stations such as nuclear, and peaking power plants such as gas, and capture of otherwise curtailed wind and solar energy streams.
These revenue streams are well known, just not normally associated with PSH. In a Superhybrid, the PSH project is the core asset that turns variable energy into reliable 24/7 carbon-free electricity for which it can be properly rewarded 24 hours per day, not just when generating.
IHA concludes that PSH must be “private sector developed but public sector enabled.” The Superhybrid helps make this viable by reframing PSH as a central node in a resilience strategy, not just an energy project. Governments can support enabling infrastructure – transmission, permitting pathways, industrial partnerships – and can directly support the PSH by providing a bread-and-butter CFD for green baseload power with the construction and financing challenges handled by the private sector, where it can be done best. Private actors, meanwhile, can craft diversified investment narratives that speak to climate, energy and economic priorities at once.
In sum, the Superhybrid doesn’t contradict IHAý findings. It operationalises them. It responds to complexity not by simplifying it, but by designing around it – offering a new blueprint where PSH can finally realise its potential as the backbone of a clean, resilient and bankable energy future.
Itý exactly this kind of integrated thinking that will help the hydropower sector meet the demands of the next 30 years – and deliver a more resilient, renewable-powered world.
