The Crown Estate will lease 13 hectares of land for a £160 million grid-scale electricity storage facility in North Wales.
Developer Snowdonia Pumped Hydro (SPH) will build the Glyn Rhonwy storage unit near Llanberis.
It will have the potential to produce nearly 100MW of electricity using pumped hydro technology.
Grid energy storage is used to store electricity on a large-scale and is stored when production exceeds usage.
Water will be pumped to a reservoir when electricity demand is low, then released back through turbines to a lower reservoir to regenerate the electricity at times of high demand.
The facility will have a capacity of 600MWh and achieve carbon payback within six to nine months, expected to start operating 2019.
Peter Taylor, Chairman of SPH parent organisation Quarry Battery Company said: “By continuing to utilise unconventional sites such as the abandoned quarry on the Crown Estate’s land, Britain can realise an additional 15 GW of grid-scale storage using pumped hydro technology alone.”
Currently, more than 99% of the world’s grid-scale electricity storage is pumped hydro due to its low cost and proven technology, according to the company.