Pump storage units have both the function of generation and that of storage. A new equilibrium model for the electricity market considering these specific characteristics of the pump storage units is proposed. The model divides a day into three periods， i.e. the storage period， the generation period and the idle period. The pump storage units are treated as loads and generators in the storage period and generation period， respectively. Test results show that the pump storage units can not only clip peak-loads and fill valley-loads， but also reduce the price during the peak load period. In addition， the efficiency improvement of a pump storage unit can increase its own profit， the demand revenue as well as the total social revenue. The market operation efficiency will be significantly improved if there are more pump storage units distributed in the grid.