The diagram illustrates how electricity is produced in a hydroelectric power station that uses two reservoirs at different levels. Water is collected from a river in a high-level reservoir, which is held back by a dam. From the high reservoir water flows through an intake (which is open during the day and closed at night) into a system of pipes that lead down to the power station. The water drives reversible turbines housed in the power station; during the day the turbines rotate generators to produce electricity, which is transmitted to the national grid via power lines.
After passing through the turbines the water is discharged into a low-level reservoir. At night, when electricity demand is lower, the system works in reverse: the turbines operate as pumps and force water from the low-level reservoir back up through the pipes into the high-level reservoir for storage. In this way the plant stores energy by pumping water uphill during off-peak hours and generating electricity during peak demand.
Overall, the diagram shows a pumped-storage hydroelectric scheme that balances supply and demand by alternately generating power and pumping water, using the elevation difference between the two reservoirs.