News

UPDATED SNOWY 2.0 BUSINESS CASE REVISES NPV UPWARD TO $3BN

24/05/2024

Snowy Hydro is pleased to release the updated Snowy 2.0 business case presenting the project’s key revenue streams and value to the National Electricity Market (NEM). 

Marsden Jacob Associates (MJA), a long-standing expert in modelling the NEM, was re-engaged in mid-2023 by Snowy Hydro to provide updated NEM modelling as input to the updated business case.

While the economic drivers at the time of the project’s Final Investment Decision (FID) in December 2018 have not changed, there are a number of updates and these include:

  • Revised total cost to complete of $12 billion and a delay to the commercial operation date to December 2028.
  • Delivery of an additional 200 megawatts or 10% capacity; bringing total capacity to 2,200 MW. 
  • Increased Snowy 2.0 generation, reflecting the greater penetration of variable renewable generation (wind and solar).

The value of Snowy 2.0 to the NEM has increased since FID in December 2018, to $3.0 billion from $2.8 billion. Its completion is critical to supporting the NEM’s decarbonisation and reliability targets.

Snowy Hydro has already contracted 1.75 gigawatts (GW) of wind and solar supply which enabled 2.9GW of wind and solar projects. Snowy 2.0 will enable at least another 6GW of renewable energy through its ability to “firm” the intermittent wind and solar energy and transform this energy into cost-effective, reliable electricity supply.

The 350 gigawatt hours (GWh) of energy storage provided by Snowy 2.0 through its pump/generate function provides a meaningful step towards the 640GWh of storage identified by AEMO in its 2022 Integrated System Plan as being crucial to absorbing surplus renewable production and maintaining supply during periods of low renewable output.

Located in the NSW Snowy Mountains, Snowy 2.0 is 57% complete, with a workforce of 3,000 achieving good progress across the construction worksites.

At Lobs Hole, tunnel boring machine (TBM) Lady Eileen Hudson has excavated approximately 2km of the 6km tailrace tunnel, and world-leading TBM Kirsten is about to embark on the Inclined Pressure Shaft (IPS) excavation on a steep uphill drive of 1.6km. Stage 2 drill and blast excavation of the power station caverns continues.

When completed, the machine and transformer halls will form one of the largest and deepest caverns in the world, 800 metres underground.

More than 570,000 cubic metres of material has been excavated at the Talbingo intake – where water will exit the tailrace tunnel into Talbingo Reservoir and enter the tunnel when in pumping mode.

At Tantangara, the intake is three metres away from its fully excavated depth of 55 metres and the tunnel linking the intake and gate shaft is underway. TBM Florence is more than 850 metres into the headrace adit.

With progress slowing in very hard rock, the Snowy 2.0 project team ceased excavation by TBM Florence due to rock pinching on the machine’s shield. A specialist contractor has commenced work using high pressure water jets to remove the rock impinging on the machine’s shield. 

The 28-metre wide headrace surge shaft at Marica is excavated to a depth of 85 metres, on its way to 250 metres. 

The precast factory at Polo Flat, Cooma, is manufacturing concrete tunnel lining segments installed by the TBMs. More than 104,000 have been produced, along with 450 of the 7,000, nine-tonne bespoke segments for the IPS that utilise innovative force activated couplers.

The Snowy 2.0 updated business case was assessed following the revision to the project’s schedule and costs announced in August 2023.

The updated Snowy 2.0 business case is available here.

News

ANAO REPORT: SNOWY 2.0 GOVERNANCE OF EARLY IMPLEMENTATION

17/06/2022

Snowy Hydro welcomes the ANAO’s findings that the Company’s governance of the project is effective, with no recommendations raised.

Specifically, the audit concluded that Snowy Hydro has appropriate arrangements in place to govern, monitor and report on the project; including in relation to managing the Engineering, Procurement & Construction contract with our principal contractor Future Generation JV.

From the outset, Snowy Hydro established tailored governance arrangements to oversee the development and implementation of this critical energy infrastructure project.

It is pleasing that the effectiveness of these arrangements have been independently assessed by the ANAO, with no material exceptions identified.

To read the full ANAO report please click here.

News

SNOWY 2.0 MAIN WORKS TO DRIVE JOBS AND INVESTMENT

28/08/2020

Snowy 2.0 today achieved another significant milestone with the Federal Government’s approval for the project’s main works construction. 

The Snowy 2.0 pumped-hydro project is a major expansion of the Snowy Scheme, linking two existing dams, Tantangara and Talbingo, through 27km of tunnels and building an underground power station.

The approval today allows construction to commence on the underground power station, waterways and access tunnels, and other supporting infrastructure.

It follows on from exploratory works, which got underway in 2019 and has included constructing site access roads, establishing a construction compound and excavating an exploratory tunnel.

“This approval marks the next stage in Snowy 2.0’s construction and brings our vision to become Australia’s biggest battery and storage for renewable energy one step closer,” Snowy Hydro’s CEO Paul Broad said. 

“It’s full steam ahead for the Snowy 2.0 project that will pave the way for Australia’s energy transition.

“It also unlocks billions of dollars of investment that will create thousands of jobs over the life of the project and provide a much-needed boost to the local and regional economy, which has been hit by drought, bushfires and COVID-19. 

“Snowy 2.0 is already playing a major part in kick-starting the local economy, with more than 100 local businesses involved and more than $35 million spent in the Snowy Mountains region.

“On completion of the project in 2026, it will provide 2,000 megawatts of new peaking power and firming capacity that will provide clean and reliable energy to millions of Australians.”

News

Snowy Hydro appoints preferred tenderers for Snowy 2.0

18/01/2019

Snowy Hydro has appointed Australian and global experts in construction, engineering and hydropower as preferred tenderers for the Snowy 2.0 project, following extensive competitive tender processes over the last 18 months.

The preferred tenderer for the civil works is Future Generation, a partnership between Australian construction and engineering company, Clough, and global hydropower and tunnelling specialists, Salini Impregilo.

World leader in hydropower engineering and equipment supply, Voith Hydro is the preferred electrical and mechanical tenderer and will deliver the latest hydro-generation technology in the new power station.

Australian company Leed Engineering has also been awarded the contract for exploratory works pre-construction activities.

Contracts are currently being finalised, with contract execution subject to Shareholder approval of the project.

This is another important step towards the commencement of the project. Snowy 2.0 is a world-leading pumped-hydro project that, with the existing Snowy Scheme, will underpin the stability of the energy market as more renewable energy enters the system.