Snowy 2.0 FAQs

What is the Snowy 2.0 project?

Snowy 2.0 is an expansion of the existing Snowy Scheme adding new pumped hydro capability between Tantangara Reservoir and Talbingo Reservoir. The project would increase generation capacity by up to 2000 megawatts, and at full capacity, about 350 000 megawatt hours of energy storage.

Snowy 2.0 will act like a giant battery, storing water which can be used as energy at times of high energy demand. As the economy decarbonises we are seeing more intermittent sources of electricity generation (like wind and solar) added to the energy mix while coal fired generation is retiring. This change in the energy market will make large-scale storage projects like Snowy 2.0 critical.

When it comes to capacity, cost, location and longevity, there is currently no other technology or storage option that comes close to Snowy 2.0. Snowy 2.0 is strategically located to service the two main load centres of Sydney and Melbourne and uses existing water storages so there is no need for new dams.

The Snowy 2.0 feasibility study is underway and will be completed by December 2017.

How does pumped hydro work?

Pumped hydro works like a conventional hydroelectric scheme: in periods of high demand, electricity is generated by releasing water from an upper reservoir and into a lower reservoir. Unlike a conventional hydro scheme, where water is discharged, a pumped hydro scheme “recycles” or pumps water back to the upper reservoir during times of low energy demand.

How long will it take to build Snowy 2.0?

The feasibility study is currently underway and will be completed in December 2017. The study will outline the Snowy 2.0 project timeframes, but we expect the project to take approximately six years.

How many jobs will the Snowy 2.0 project create?

While the Snowy 2.0 project will pull together the very best technical experts from across the country and around the world, creating local jobs and engaging with local companies remains a priority.

The feasibility study includes consideration of the type and make up of the workforce, and we expect the project will create thousands of jobs, many of which will be in the Snowy Mountains region.

The work on feasibility study has already created hundreds of jobs across professional services, construction and trades and administrative support.

What is the estimated cost of Snowy 2.0?

The feasibility study is currently underway and will determine the cost of delivering the Snowy 2.0 project.

What role does SMEC have on the Snowy 2.0 project?

SMEC is the lead consultant engineer for the feasibility study. They were appointed after a competitive selection process and will be working closely with Snowy Hydro on assessing the technical requirements and options for the Snowy 2.0 project. For the Snowy 2.0 project, SMEC reopened its office in Cooma.

What are the environmental impacts of the Snowy 2.0 project?

Snowy Hydro has a long and proud track record of operating in the Kosciuszko National Park.  An Environmental Impact Statement will be prepared to support these approvals which will take into full consideration the potential environmental, social and economic impacts of the Snowy 2.0 project and how to manage these.

It should be noted that the majority of the Scheme’s expansion will be underground and not through Kosciuszko National Park, this includes the tunnels and power station located approximately 800m below the surface.

Will Snowy 2.0 use or need more water?

Snowy Hydro will continue to operate under its stringent water licence arrangements set by the New South Wales Government. These requirements will not change with Snowy 2.0 and the proposed expansion will not impact on irrigators and downstream water users.

Snowy Hydro has been successfully managing water inflows, balancing dam storages and releasing water across the scheme for more than half a century. This includes through periods of record breaking droughts and flood.

Snowy 2.0's pumped hydro capacity will give Snowy Hydro greater flexibility and enhance Snowy Hydro’s current ability to move water around the Scheme. The Snowy 2.0 project also helps to ‘drought proof’ Snowy Hydro’s operations by allowing water to be recycled in a closed loop and used more than once before it is released. This makes the most of all available inflows, particularly in times of drought.

How is Snowy 2.0 a ‘battery’ - it doesn’t look like one?

The ability to pump and store water would see Snowy 2.0 act exactly like a battery in the sense of absorbing, storing and dispatching energy. Snowy 2.0 will pump water using electricity at times of low demand and store it in our dam. Then, when energy is needed most, our stored water will be used to generate and dispatch electricity just like a battery would.

Pumping water at times of low demand means we are able to generate energy at times when consumers need it most. For example, if the wind is blowing in the middle of the night when consumers are asleep we’ll use the wind energy to pump our water into storage and when they wake up and need electricity we are able to generate energy.

When it comes to batteries or other forms of storage technology nothing can compete with Snowy 2.0 when it comes to scale, value for money or capacity.  While Snowy 2.0 would use of cutting edge technology and the latest engineering techniques, pumped-hydro itself is a proven form of energy generation and storage.

Why is pumped hydro needed, can we just use batteries?

Pumped hydro is a mature and proven technology and is used around the world to store energy. Snowy Hydro already operates a pumping storage at Tumut 3, and are experts in operating this type of energy asset.

The need for energy storage in the future is only going to grow. While there are existing energy storage options such as household batteries, nothing comes close to the scale, value for money or capacity of pumped hydro. While batteries and new technologies will play a role in providing energy storage, Snowy 2.0 is the most credible option to provide energy storage for households and businesses across the NEM.

Snowy 2.0 Compared with Batteries

Capacity Snowy 2.0 can store  350,000 MWh - this is as much as 35 million batteries (10kwh)
 Cost It would cost more than $200 billion in domestic batteries to produce the equivalent storage of Snowy 2.0
 Output/Dispatch Snowy 2.0 can run for more than a week, domestic batteries typically only last for a few hours
Longevity Snowy 2.0 will last for generations while a typical domestic battery needs to be replaced in around 10 years.

Do you use more energy to pump than you make when you generate?

Yes, there is a small efficiency loss when water is pumped. However, pumping water gives us the ability to absorb energy when it’s not needed, store the water, and release it to generate energy when it is needed.

For example, the sun shines the brightest during the middle of the day, and this is when solar generation is at its peak. However, during the day many people are at work or school so energy demands are not at their peak. Snowy 2.0 could use this solar energy which is not needed during the day to pump water so that when the sun sets and people get home we can generate energy to meet the spike in demand that we see in the early evening.

While we lose some energy pumping water, there is no other way to have it sitting in storage ready to be used when consumers need it most. You can’t make the wind blow or the sun shine, but with pumped hydro you can generated energy on demand. Snowy 2.0 will be reliable and can be quickly turned on to respond to the changing energy needs within a few minutes.

Do we need more storage than just Snowy 2.0? Will there be a Snowy 3.0, 4.0 etc?

We will need a significant amount of dispatchable energy generation and storage in the future. If Snowy 2.0 is built, it could act as a model for further pumped hydro expansion projects in the area in between Tantangara and Talbingo reservoirs (you may have heard these options called Snowy 3.0 and Snowy 4.0).

As the need for energy generation grows we may look at further expansions and it could be possible to see future projects that could increase the Scheme’s capacity by up to 8000MW.

Projects considered after the construction of Snowy 2.0 would be very cost-effective as they would utilise access routes and the support infrastructure that would have been built at the time of Snowy 2.0.

What about transmission?

New and upgraded transmission infrastructure will be needed to get the additional energy generated by Snowy 2.0 out into the NEM. Transmission assets are managed by transmission network providers (TransGrid in New South Wales and SP Ausnet in Victoria) and while energy companies like Snowy Hydro need transmission, we do not own or operate transmission.

Transmission requirements are currently being considered as part of the feasibility study and we are in discussions with transmission providers about the requirements of the project.

Who are Snowy Hydro’s Shareholders and what does the Commonwealth’s interest in owning more of Snowy Hydro mean for the project?

Snowy Hydro has three shareholders. The Commonwealth owns 13 per cent, NSW Government 58 per cent, and Victorian Government 29 per cent. Any changes in ownership are a matter for our shareholders. Snowy Hydro has been a entity incorporated under the Corporations Act 2001 (Cth) since 2002, and will continue to operate as a Corporations Law company governed by an independent Board of Directors.

What happens next?

Once the feasibility study is completed in December 2017, Snowy Hydro’s independent Board of Directors will consider its findings. We will provide a further update on next steps at this time.