27 May 2011: The World Bank approved a US$640 million loan to build a pumped storage system in Indonesia’s Upper Cisokan Pumped Storage Hydropower project, to allow the power plant to supply electricity in peak season.

Pumped storage systems work using two water reservoirs built at differing heights. Energy is stored by using pump turbines to transfer water from the low to the high reservoir, during off-peak hours. During periods of peak demand, the stored water in the high reservoir is released through turbines to the low reservoir for hydroelectric power generation. As a result of this project, Indonesia will be able to transform the cheap electricity surplus generated during off-peak hours into valuable peak energy. The total cost of the project will be US$800 million. [World Bank Press Release]