Prime Minister Malcolm Turnbull says Tasmania could become the “battery of Australia”.

The Federal Government has launched feasibility studies to see if Tasmania can double its hydro-electric output through 13 pumped hydro schemes.

Pumped hydro uses pools of water that are pumped uphill when power costs are low, and then released back downhill to run turbines at peak times when power is expensive.

The investigation comes alongside Hydro Tasmania’s own inquiry into upgrades at the aging Tarraleah and Gordon power stations, which would also increase capacity.

Energy consultant Marc White has urged caution.

“Pumped hydro is expensive and basically takes more energy to pump the water uphill than what you get out of it when you run it downhill the first time,” Mr White said.

“And what we're talking about is the same sort of size as the Snowy Hydro pumped storage scheme so we'd be potentially competing against that system.”

He said a lot of customers were going ‘off the grid’ and setting up their own power systems.

“Those products are all competing for the same high-peak price market and the question is, will both of those projects survive?” he said.

Australian National University (ANU) fellow Matthew Stocks said pumped hydro could be an important part of Australia’s energy network.

“The electricity network is changing, as we start to put more wind and solar into the system, storage starts to become important to help balance out the differences,” he said.

“In the past, we've had this view of big power stations where we just put out power when we want it.

“But with more and more renewables we need to be able to store energy when we have an excess ... such as when the winds are blowing and the sun is shining.

“The flip side is we need to be able to release that energy when there's a short supply.

“Pumped hydro is a very established technology, it's the cheapest way to store bulk energy.”