Snowy 2.0 cost blowout requires more government funding

Summarised from 2 outlets · Updated 26 Oct, 18:31 · Archive

Australia's largest renewable energy project will cost between $22.2 billion and $25 billion to complete, up from $12 billion in 2023.

Snowy 2.0's costs have jumped to between $22.2 billion and $25 billion to complete, up from the $12 billion estimate in 2023. The pumped hydro project is designed to store up to 350 gigawatt hours of renewable energy and is expected to reach completion in 2029.

Snowy Hydro chief executive Dennis Barnes told a Senate estimates committee that just under $12 billion had already been invested in the project. He said the company had not modelled the cost of terminating the development, despite the recent reassessment of construction costs. "We have done the analysis of what would we do if we were to change contractor," Mr Barnes said. "But we have not done the analysis on what it would cost to terminate the project given the importance of the project to the grid."

The company did calculate how much it would cost to replace Snowy 2.0 with eight-hour batteries capable of delivering 42,000MW, arriving at a figure of $80 billion. Mr Barnes said the project would require significant government funding to reach completion, although he did not specify how much additional money would be sought from taxpayers. He expressed confidence that the project could be completed within the revised cost estimate, saying the contingency and risk buffer applied were appropriate.

How it is being reported

• Snowy 2.0 exit cost unknown despite price blowoutOne of Australia's largest energy projects will need more government funding to reach completion, but the cost of giving up has not been calculated.Perth Now · 26 Oct, 18:05
• Snowy 2.0 exit cost unknown despite price blowoutOne of Australia's largest energy projects will need more government funding to reach completion, but the cost of giving up has not been calculated.The West Australian · 26 Oct, 18:05

In this story: Snowy 2.0 · Dennis Barnes · Snowy Hydro · Australia · Senate

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