But not all Lithgow residents are on board with the idea of the facility, with a 'No Hydro for Lake Lyell Action Group' which believes the facility is inappropriate and retrograde development for the Lithgow and Lake Lyell areas.

The group has some major questions that want to see Energy Australia answer before ploughing ahead with the development.

One worry the group has is the visual aspect of the project, worried that since there is no known height and length that the development will be seen for many kilometres since it is high up on a mountain.

"The dam project could be see from most areas in the Lithgow town but would also be visible from Bowenfels, South Bowenfels, Mt Victoria, Good Forest, Lowther, Hampton, Rydal, Mt Lambie to name a few," a spokesperson said.

"The impact on land values could possibly be significant for those immediately adjacent to the proposed dam in western Lithgow or on many rural properties that are adjacent to the dam construction area."

Energy Executive, Liz Westcott, said early estimates suggest a Lake Lyell pumped hydro energy storage facility would be capable of producing 350 megawatts of electricity with around eight hours of storage, enough to power over 150,0001 households during peak demand.

"Initial studies show that a Lake Lyell pumped hydro energy storage facility has enormous potential to become a major piece of infrastructure for New South Wales in a transitioning energy system," Ms Westcott said.

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"Pumped hydro will continue to play an important role in providing reliable, affordable and cleaner power for homes and businesses into the future. One of the benefits of Lake Lyell is that it's already located near major transmission lines," she said.

"It's a low-emission technology that can store large volumes of electricity for quick release, helping to provide cover at times when renewables aren't available and fill a large gap that will be left by the retirement of coal power plants. The ability to operate in seconds will ensure the lights stay on and energy costs are kept down for customers."

The proposal plan indicates it plans to use Sir Thomas Mitchell Drive for the purposes of construction and maintenance, but even this isn't a good idea, according to the 'No Hydro for Lake Lyell' spokesperson.

"This will involve significant heavy machinery and heavy use during contraction phase, this quiet rural road was not planned for this type of activity," they said.

The group is also worried about the impacts the development could have on popular tourist attraction Lake Lyell.

"Lake Lyell has been promoted as the 'gem of the west' for many years and a huge group use the dam every year for recreational purposes, we all know how valuable this dam is to Lithgow residents and tourism," they said.

"Many people are visiting Lake Lyell each year for fishing, water skiing, camping or just visiting."

Lake Lyell is not always at capacity and during the 2019 drought period Lake Lyell water levels subsided significantly as did other dams.

"Removing an additional 4.4 gigalitres of water would be disastrous during these periods, and the possibility of the dam being closed to the public is another unknown outcome," they said.

"By moving 13 per cent of the entire dam capacity up and down Mt Walker in a 24 hour period it is likely that the dams would fluctuate in height by several metres in a 24 hour period. We have no knowledge on the impact of this on skiing, camping, fishing etcetera.

"This proposed dam will hold 1,760 Olympic swimming pools of water, in other words, it is massive."

Lake Lyell would be used as a lower reservoir, and the upper reservoir would be located on the south side of Mt Walker, all on land owned by EnergyAustralia.

Head of Mt Piper, Greg McIntyre, said the facility would provide a welcome economic boost for the region and support Lithgow in becoming a future renewable energy hub.

"A new pumped hydro facility at Lake Lyell would ensure Lithgow's legacy in energy generation is preserved well into the future," Mr McIntyre said.

"If the project goes ahead, we anticipate hundreds of jobs would be created during construction, with roles also needed to oversee the facility's ongoing operation," he said.

More safety issues that the group is concerned about includes that large movements of water may have a significant element of risk associated with rapid changes of water levels for those using the dam.

"Movement of 'Four million tons of water' in short time periods and under high pressure would create massive disturbance within the dam. This would potentially have a notable impact on water quality," they said.

"The pumps proposed for this venture will be enormous, we have no information regards noise at this stage."

According the press releases these pumps will be "lifting over four million tons of water up the hill each night".

With the Lithgow region needing to create more jobs for residents, the Action Group is worried that there will be few long term jobs in the area once construction is completed.

"If Lake Lyell is severely impacted it is far more likely the negative consequences on tourism will far exceed any job creation program," they said.

"Since 4WD and trail bikes are popular on Mt Walker, security will possibly restrict this access.

"There is so much we don't know about this project at present and available information is very limited."

Head of Mt Piper, Greg McIntyre said that detailed assessments to follow including environmental impacts and planning approvals.

"Before any firm decisions can be made; however, the first step is consulting with our community," he said.

EnergyAustralia has a goal of being carbon neutral by 2050.

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