The Federal Government has committed funding and approved the Snowy 2.0 project as a measure in its renewable energy pitch — the former prime minister Malcolm Turnbull’s pet project.
- The project is estimated to cost between $3.8 billion and $4.5 billion
- It would multiply generating capacity by 150 per cent and could power 500,000 homes during peak demand
- The Government said it would create 2,400 jobs
It represents a significant step forward and financial commitment towards the progress of the long-term engineering project that aims to put a new underground power station in a remote corner of the Snowy Mountains.
The Government has given the company responsible, Snowy Hydro, shareholder approval to proceed to the “early works stage” after reviewing its business case, concluding it is “satisfied that it stacks up”.
Prime Minister Scott Morrison will on Tuesday be on site in New South Wales to commit “up to $1.38 billion in an equity investment for Snowy 2.0”.
“Snowy 2.0 will inject the energy supply and reliability our electricity market needs, helping cut costs to families and businesses and cut Australia’s emissions,” he said.
“Snowy 2.0 is shovel-ready which is why it’s one of the first cabs off the rank in our next tranche of energy projects to underwrite power generation, so we can make electricity more affordable and reliable.”
The plan revives the Snowy Hydro Scheme in the Great Diving Range.
The Snowy 2.0 project will link the Talbingo and Tantangara reservoirs in Kosciuszko National Park.
If it goes ahead, the rest of the project will be funded by Snowy Hydro.
In recent reports, the company estimated it would cost somewhere between $3.8 billion and $4.5 billion and multiply Snowy Hydro’s generating capacity by 150 per cent.
“After almost two years of rigorous engineering, financial and market modelling, we’re excited to embark on a new chapter,” chief executive of Snowy Hydro Paul Broad said.
“With more intermittent generation coming online Snowy Hydro will play an increasingly critical role to keep the lights on.”
The Government said the project will provide 175 hours of energy storage, enough to power 500,000 homes during peak demands.
It said the project would create 2,400 jobs and 5,000 direct and indirect jobs across the region.
The project was repeatedly spruiked by former prime minister Mr Turbulll, who had said the critical thing was “engineering and economics”.
The policy, or Climate Solutions Fund, is an extension of former prime minister Tony Abbott’s Emissions Reduction Fund (ERF).