Why we need Snowy 2.0 and large-scale energy storage
Snowy Hydro already has the capability to store huge amounts of energy - at times of peak demand we keep the lights on. But our current capacity in the Scheme won’t be enough in the future, which is why we’re planning for Snowy 2.0 to help meet market needs.
Snowy 2.0 will be critical to helping provide Australian businesses and households with reliable, stable and affordable energy in the future. We’re past the tipping point. With the falling costs of new renewables and thermal generation progressively retiring, the National Electricity Market (NEM) is transitioning to a lower-emissions future.
There is no doubt that over the coming decades the NEM will operate very differently to how it does now. In the future there will be a higher level of intermittent energy generation and a greater need for a range of new generation and energy storage options.
In a market with a higher penetration of renewables, quick-start dispatchable energy like hydro-power and large-scale energy storage becomes even more important. At times of high demand, when the wind isn’t blowing or the sun isn’t shining, Snowy 2.0 will provide much-needed and reliable energy to the market.
Pumping, storing and generating on demand using a large hydro power scheme like Snowy 2.0 is the most cost effective option when it comes to large-scale storage.
The dispatchable generation of Snowy 2.0 (and the existing Snowy Hydro business) will ‘firm’ up new intermittent renewable generation and underpin the stability of the electricity system.
Our modelling shows there will be a need for much more storage than just Snowy 2.0. The NEM will need a mix of storage options including household and commercial scale batteries and other pumped-hydro projects. There will also be a role for demand management and behind-the-meter solutions.