The State Grid Corp of China, China's dominant grid operator, plans to raise its pumped storage hydropower generating capacity to 21 gigawatts (GW) by 2015 and 41 GW by 2020, complementing the fast development of irregular renewable energy sources such as wind and solar power.

Under this system, water is pumped from a lower elevation reservoir to a higher elevation by using low cost, off-peak power production such as wind power during the night to run the pumps, and is released to generate power when demand peaks during the day or when electricity prices are higher.

China had only 14.55 GW of pumped storage hydropower capacity at the end of 2009, according to the State Grid.

China's total power generating capacity was 874 GW at the end of 2009.