Following completion of a two-year feasibility study, the firm has determined that the hydro-electric power station, which generates and stores energy, can be expanded with up to 600MW additional capacity.
The expansion plan will require an investment of between £300m to £400m.
According to the study, a new cavern would need to be excavated within Ben Cruachan and new dams will be constructed to increase the capacity of the upper reservoir, the firm said.
ScottishPower is currently considering all the options and will consider possible next steps which include discussions with the government on potential support mechanisms.
The potential Cruachan expansion project would include an eight to 10 year build program for the extension; two to three years to secure Section 36 planning consent and other consents; and six to seven years for construction and commissioning.
ScottishPower expects the expansion project could create up to 800 jobs for the main civil construction works.
ScottishPower generation director Hugh Finlay said: "A new generation of pumped storage hydro would be a major asset for electricity systems worldwide as more renewable electricity continues to come on line.
"As well as being able to further support peak demand, expanded pumped storage would also be able to effectively store greater levels of electricity at times when renewable energy output is high but demand is low.
"Pumped storage hydro is the most cost effective and well-developed large-scale electricity storage technology in existence."
The firm said that it will now move ahead with the Cruachan findings with government and regulators.
Image: The Cruachan hydro plant located near Oban in Scotland. Photo: courtesy of Scottish Power Ltd.
