Zen Energy, an Adelaide-based renewable energy gen-tailer, wants to turn a disused coal washery site at Nattai, in the Australian state of New South Wales, into a clean energy powerhouse, delivering on-demand electricity to help stabilize the electricity grid as it transitions to renewable energy generation.

Zen Energy said its proposed Western Sydney Pumped Hydro project would be capable of providing critical backup for renewable energy sources, generating 1 GW of on-demand power for up to eight hours – enough to power the equivalent of 500,000 homes and businesses.

Zen Energy said that if all approvals and a social licence are secured, construction could begin at the site, about two hours southwest of Sydney, in 2027, with the asset to be operational by 2031.

“The vast water reserves of Lake Burragorang can supply Sydneysiders with clean drinking water and clean, renewable energy as well,” said Zen Energy Chief Executive Officer Anthony Garnaut. “Large-scale energy storage projects like Western Sydney Pumped Hydro are key to keeping the lights on and energy prices in check in [New South Wales] as our coal-fired power stations age and retire over the next decade.”

The pumped hydro project marks Zen Energy’s entry into renewable energy development in New South Wales and the company said it will now move forward with community consultations and site assessments. Initial studies have established that the project would have no detrimental impact on water quality at Lake Burragorang and the Warragamba Dam, which is 24 kilometers upstream.

WaterNSW Chief Executive Andrew George said the corporation has completed a water-quality risk assessment at the proposed Western Sydney Pumped Hydro site. He said that if the project proceeds, a small amount of water, much less than is lost to evaporation, will be used in a continuous loop.

George said WaterNSW has already conducted an extensive water quality risk assessment on all aspects of the proposal and will continue to undertake such research as Zen Energy moves the proposal through the planning and approval processes.

“As custodians of Sydney’s water supply, our most critical factor in considering this proposal was making sure that the project does not impact the quantity or quality of the water supply from Warragamba Dam at any stage,” he said.

The development agreement with WaterNSW is the fourth pumped hydro project being explored as part of the corporation’s Renewable Energy and Storage Program. Former Australian Prime Minister Malcolm Turnbull’s Upper Hunter Hydro (UHH) was earlier this year awarded a contract to develop two large-scale pumped hydro projects in the Hunter Valley, while Acen Australia is pursuing plans to develop a project at Lake Burrendong in the state.

Should the Western Sydney Pumped Hydro project proceed to construction, it is expected to create approximately 1,500 construction jobs and 80 ongoing operations jobs.