Australia's largest pumped hydro storage project has taken a step forward, increasing its storage potential to 2000 megawatts hours.

Genex Power has completed a technical feasibility study into stage 2 of its Kidston project, slashing construction time and changing its design to increase operational capacity to eight hours of 2000 megawatt hours of continuous generation.

The pumped hydro storage project will likely begin construction next year.

"The Kidston renewable energy hub is currently the most advanced, lowest-cost large-scale energy storage project in the country," Genex Power managing director Michael Addison said.

"The optimisation study outcomes have been developed in response to direct feedback from potential energy partners amid the ongoing backdrop of the national debate on energy policy, and the importance of ensuring dispatchability of renewable energy via energy storage," he said.