EnergyAustralia, one of the country’s big three utilities, says it has decided to shift the location of one of the reservoirs for its proposed pumped hydro project near Lithgow, and to put the pump house underground.

The changes follow community feedback on the proposed Lake Lyell pumped hydro project, which the utility giant hopes to build around the same body of water that located next to and is used by its Mt Piper coal generator.

Lake Lyell also used to support the Wallerawang coal fired power station, also once operated by EnergyAustralia, but now has free capacity since the closure of that generator.

The lake would act as the lower reservoir for the pumped hydro project, which is likely to have capacity of 350MW and up to eight hours of storage, (2,600MWh) although longer at a lower output.

“The design change has been made in response to community feedback and the initial assessment suggests the upper reservoir, to be built on land already owned by EnergyAustralia, will now not be seen from the majority of Lithgow,” the company said in a statement on Tuesday.

“The assessment also indicates the new location will also be either not visible or significantly less visible from Bowenfels, South Bowenfels and Hillcrest Estate.

“As part of the design change, the pumphouse for the project will also be located underground further reducing visual impacts and ensuring very minimal noise associated with running the pumped hydro facility.”

The director of the Lake Lyell project, Mike de Vink, said locals had expressed concern about the visual impact of the upper reservoir.

“We passed the challenge to our engineers, and we’ve come up with a solution which substantially reduces the project’s visual impact,” de Vink said in a statement,

“It is expected that the new location means many of the private homes that would have seen the original upper reservoir design will now not see the upper reservoir at all.”

It will still be visible to some properties on Sir Thomas Mitchell Drive and on the Rydal side of Lake Lyell. “We will keep working with those landowners,” he said.

de Vink said the change in location meant that the reservoir wall will now be built from natural rock rather than construction techniques using concrete. This would reducing the carbon footprint of the project.

EnergyAustralia is currently conducting a feasibility study on the Lake Lyell pumped hydro project and it is also looking at a big battery project at the site of Mt Piper, while another two companies look at big batteries next to the former Wallerawang site.

All going well, EnergyAustralia hopes to make a final investment decision in 2025, and have the project complete by 2025.

But while Energy Australia would not comment on the cost impact of its changes, pumped hydro is already proving hard to do.

None of the more than half a dozen pumped hydro projects proposed by various deep-pocketed utilities were successful in the NSW state government’s recent long duration storage tender, and there is now recognition that they cannot compete on those terms with eight-hour batteries.

Any support for pumped hydro projects – still seen as important for providing longer duration storage for a renewables grid – will likely come from the state government’s new Energy Security Corporation, which is armed with around $1 billion to support such projects.

A rival pumped hydro project proposed by Canadian giant Atco near Bathurst, not far from Lake Lyell, has been put on hold while the company seeks clarity over the state government’s policy frameworks.

The 325MW, eight hour (2,600MWh) Central West project was to start construction as early as 2024. The company is waiting for the state government’s policy frameworks to “mature”.

The new Labor government is still wrestling with the idea that the country’s biggest coal generator is schedule to close in August, 2025, and has been sending mixed signals about its intentions. Investors have said they are confused, and hesitant.

Atco says it has deferred submitting the environmental impact statement (EIS) for the pumped hydro project, but says it is still hopeful it can go ahead.

“The project’s EIS is in the process of being finalised,” it said in a statement.

“However, we have decided to defer our EIS submission until some of the NSW government’s policy frameworks mature, and there is a clear commercial pathway for large civil projects like pumped hydro.