What is the Snowy 2.0 Project?
Snowy 2.0 refers to the expansion of pumped hydro capability within the Snowy Scheme, in order to improve energy security by storing large-scale renewable energy to provide rapid-response back up at critical times of peak demand. Snowy Hydro is conducting a Feasibility Study into the potential expansion of this capability. The site identified for this expansion would link Tantangara Reservoir to Talbingo Reservoir. The Feasibility Study will assess the options for this large-scale engineering project. The study is currently underway and will be completed by December 2017.
How long will the Project take?
The Feasibility Study is currently underway and will be completed in December 2017. Once the study is complete, the timeframe for the project will be determined.
How does pumped hydro work?
Pumped hydro storage system 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 off-peak hours.
Why is pumped hydro a good option for Australia to consider?
Pumped hydro is a mature and proven technology which is used around the world, and has been part of the security back-up for the National Energy Market for decades. Pumped hydro can provide energy storage at a fraction of the price of batteries. In fact, it is around 100 times cheaper than the best practice energy storage batteries out there. Lithium ion batteries currently have a limited ten year life span, after which they need to be replaced. In comparison, pumped hydro has an enduring life. In terms of capacity, Snowy 2.0 could store up to 350 Gigawatt hours of energy. It would take 35 million domestic batteries to match this.
What does this mean for consumers?
By providing greater security and reliability of supply as the economy shifts to renewable energy, the project can help lower prices and prevent energy price shocks.
What are the environmental impacts of this Project?
The Feasibility Study will involve a full environmental impact assessment and will comply with all regulatory requirements. Snowy Hydro has been operating in the Kosciuszko National Park since its creation and has a record of respect for the local environment. Snowy Hydro is governed by a licence to operate in the National Park and has an impeccable track record.
What does this mean for water in the Snowy Scheme?
Snowy Hydro will continue to operate under its stringent water licence arrangements. These requirements will not change. The proposed expansion will have no impact whatsoever on irrigators and downstream water users.
What about transmission?
Transmission requirements will be considered as part of the Feasibility Study. The work and cost required to carry out any necessary transmission upgrades are being assessed in conjunction with TransGrid (which manages the transmission network in New South Wales).
What role will SMEC be playing?
SMEC has been appointed as the lead consultant engineer for the Feasibility Study following a competitive tender process. SMEC will be working closely with Snowy Hydro on assessing the technical requirements and options for 2.0. SMEC has reopened its office in Cooma with more than 30 staff based in the town.
How long will the construction take?
The detailed investigations that we are undertaking in the Feasibility Study will help determine the time frame for delivery. Construction has been estimated at a minimum of four years from commencement, subject to the Feasibility Study.
What is the estimated Project budget?
The Feasibility Study will determine the cost of delivering the project; with a current estimate for construction of approximately $2 billion. Any estimated construction cost is subject to the Feasibility Study.
Whats does the Treasurer's budget announcement about changing ownership 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, Snowy Hydro’s independent Board of Directors will consider its findings. We will provide a further update on next steps at this time.