Will Turnbull’s Snowy Hydro continue its war against battery storage?

Jut hours after giving a lecture in parliament about the Coalition’s belief and commitment to free markets, prime minister Malcolm Turnbull announced the biggest federal government purchase in living memory – the $6.2 billion buyout of Snowy Hydro.

The deal to buy out the stakes held by the NSW and Victorian governments takes the federal government from a 13 per cent shareholding to full ownership, and in total control of the decision process for Turnbull’s big vanity project, the $6.5 billion (and counting) Snowy 2.0 pumped hydro plan.

It also gives Turnbull control of the fourth biggest “gen-tailer” in the country, with more than 1 million customers. From now on, it is Turnbull’s government that is going to be directly answerable for the size of their customer’s electricity bills.

This deal has been well flagged, but creates myriad issues and potential problems and  conflicts of interest, some of which are going to be difficult for Turnbull and the government to navigate, and which are crucial to Snowy Hydro’s competitors, particularly the battery storage industry.

Most of all, Turnbull will need to resolve the apparent conflict of interest between being the chief policy maker, and now the owner of the fourth biggest gen-tailer in the country.

This is occurring just as he is proposing a new energy market mechanism, the National Energy Guarantee, whose only obvious beneficiaries are Snowy Hydro and existing coal generators.

As the utility owner, and the policy maker, Turnbull is now going to be directly responsible for the electricity bills of one million customers in the Red Energy and Lumo stables, and answerable to the way Snowy Hydro plays the wholesale market, and sets its retail margins.

And, it should be noted, Snowy Hydro has not been squeaky clean in the wholesale markets, and it is the actions of the owners of peaking gas plant like itself that have been largely responsible for the huge hikes in wholesale prices over the last two years.

This report from the Australian Energy Operator – which we wrote about here “High Energy prices? Blame fossil fuel generators, not renewables” – gives an insight into how Snowy Hydro and Origin contrived to push prices up early last year.

They used the rules of the market to bid prices down to create a constraint, so they could bid prices back up again, and by a lot more than they fell. Apparently it is legal, but it’s a very bad look for a company owned by someone supposedly championing the push to cheaper prices.

Snowy Hydro is not easily synonymous with reliability either. It was the failure of its Colongra gas plant in the heat-wave last February that caused load shedding in NSW and brought the state perilously close to a major blackout. As the Australian Energy Regulator noted:

“Technical problems prevented Snowy Hydro’s Colongra power station starting from around 4.30 pm. In response, at 5.20 pm AEMO issued market notice 57396 advising that an actual LOR 3 had been declared in New South Wales from 4.50 to 6 pm, and that as a result load shedding would be required.”

Another question with federal government ownership is what, now, will become of Snowy Hydro’s role as a major agitator against progressive policies that could encourage smarter, cheaper and cleaner alternatives?

Snowy Hydro has been one of the biggest critics of battery storage. This is mostly about self interest and its desire to build Snowy 2.0, and to this end it has used some completely risible figures to try to illustrate that point.

We broached that conflict of interest in story here, The case against battery storage just hit peak stupid; and again when Snowy Hydro’s “independent” market assessment included some simply absurd cost estimates for battery storage.

But Snowy Hydro has also been a fierce critic of moves to encourage demand management. CEO Paul Broad has even gone so far as to describe them as “enforced blackouts”.

This is an extraordinarily dangerous and self-indulgent comment to be made by the head of a major utility.

It’s bad enough that such nonsense comes from right-wing ideologues on the back-bench of the Coalition government, as it does repeatedly, but it means something different when it comes from a major generator now owned by the government that sets the policies.

The risk here is that this will be used to intimidate institutions such as the AER, AEMO and the AEMC (well, no real need on the latter), to baulk at some of the reform that would be good for consumers, but not so profitable for gen-tailers like Snowy.

Remember, it is smart policies like energy efficiency and demand management that have the best chance of lowering prices and ending the gold-plating of the grid and wholesale markets. The big generators, Snowy Hydro included, have fought these at every turn.

Of course, Turnbull could take an heroic position, like the Queensland government did last year before its state election, and instruct its state-owned generators to reform its bidding prices and work to keep prices down.

The problem is that without that big cash flow, Snowy Hydro will struggle to afford the money to pay for Snowy 2.0, which is going to struggle to justify its own existence in any case.

And this is where another big danger lies. By Snowy Hydro’s own testimony, Snowy 2.0 is a project that is not needed until well into the 2030s, at least if we are encumbered with a government with such low ambition on climate change targets and clean energy as Turnbull’s.

“Snowy 2.0 is a project for the future; it’s not a project for the current state of the market,” COO Roger Whitby told a Senates Estimates Hearing this week.

And unless Australia has a majority share of renewables, something that Turnbull has vowed to stop, it will mostly be using coal to push water up hill.

The Snowy Hydro executive team is smart enough to know, however, that if the Snowy 2.0 project does not get approved now, it never will.

That’s because within very few years, the cost of battery storage, and the multiplicity of competing smaller pumped hydro and other storage projects, not to mention the growth of distributed storage in households and businesses, would mean there was no room for a monolithic, centralised asset like Snowy 2.0.

In its first years, by its own admission, Snowy Hydro 2.0 will achieve little more than protecting the business models of the existing coal plants, and stifling competition.

It admits that if the government funded project does go ahead it will indeed crowd out other competing projects, most notably battery storage.

That pits the interests of Turnbull’s government directly against the interests of the developers of battery storage, the technology that most independent energy analysts will become the dominant forces in the market, particularly in reshaping the grid into a smarter, cheaper, cleaner and more reliable machine.

Turnbull’s government has been equally dismissive of battery storage as Snowy Hydro, particularly the Tesla big battery – which has actually shown extraordinary speed and flexibility and is making people think anew about how the future grid might be shaped.

But for battery storage to reach its potential, it needs a change in rules – see Speed of Tesla big battery leaves rule-makers struggling to catch up.

This is not just the creation of 5-minute settlement periods that Snowy Hydro vigorously opposed, (because its fleet of hydro and gas plants are relatively slow moving), but also in fast FCAS markets and numerous other areas where the value of battery storage can be exploited.

The federal government, and its agencies, are responsible for those rules. It now fully owns a big utility whose business interest is to stop those changes. Like so much about Australia’s climate and energy policy, it is completely unacceptable.

Note: The reference to Turnbull’s defense of the Coalition’s attachment to “free markets” came in Question Time on Thursday in response to a question by independent Bob Katter about free markets.

“But I have to say to him, with respect to his views, that we here in the government believe in free markets, we believe in trade and we believe in free enterprise,” Turnbull said. And, apparently, government intervention and ownership in a sphere where they also set the policies.

We’d also point out his criticism of a Greens proposal to buy back the grid, made just weeks before Turnbull decided to buy back Snowy Hydro. You can read it here: Turnbull’s power play: Snowy 2.0 vs battery storage.


103 responses to “Will Turnbull’s Snowy Hydro continue its war against battery storage?”

  1. Dee Vee Avatar
    Dee Vee

    Seriously, what is wrong with Turnbull and the government. Now Australians have paid $8b for something Australians already own, and Turnbull is going to pump another $8b into a “pumped hydro” project which in reality will produce little to nothing in return. Australians are going to have to fund this $16b waste with higher electricity prices.

    This will end up being Yet Another Turnbull Stuffup!

    1. MaxG Avatar

      Pure idiocy… but then, what else does AU politics stand for?!
      Let’s wait and see how they sell this to the public! And the punters will go for their spin; I promise.

    2. Roger Franklin Avatar
      Roger Franklin

      Dee – by the time its all finished – let’s round it up to $25b! Oh and at some point the whole project will be privatised and sold to one of Big Mal’s mates for a $1!

    3. Ken Dyer Avatar
      Ken Dyer

      But wait, there’s more. The Snowy Hydro will be privatised and Snowy 2.0 will become a PPP. Plain as the nose on your face. The LNP COALition has form on this, just look at Victoria under Kennett, and NSW poles and wires are now owned offshore. make no mistake, the taxpayer will be screwed!

      1. david_fta Avatar

        But wait, there’s more. NSW’s $4 billion wil be used to build Glad & Alan’s Temples of Sport, with $1.5 billion left over for child protection, the issue RECENTLY raised by NSW MLC Matthew Mason-Cox in the Fairfax media.

        1. Joe Avatar

          Hold that thought…our Glad ( I live in Sydney ) has sniffed the ‘anti Stadia knock down & rebuilder’ wind and promised that the $4billions won’t be WASTED on this Stadia boondoggle. Instead Country Boy John Bara gets to do a giant pork barrel job by sprinkling the $4billions all over regional NSW in the run up to next years NSW State election. $4billion dollars of vote buying, it is a pollies wetdream!

          1. david_fta Avatar

            If some of the $4 billion was spent on buying up empty houses in the regions and shifting at-risk kids there, then they’d be repopulating country towns, at the same time as making Sydney slums available for re-development (asset recycling).

  2. trackdaze Avatar

    By the time snowjob 2.0 rolls around there will be well over 1GW (170MW, now) of behind the meter storage and a further 1GW of Vehicle to grid capability.

    Still need though.

    1. Cooma Doug Avatar
      Cooma Doug

      Snowy 2 will provide and enable existing products that will effectively increase the investment return on a home battery and associated technologies.. Thats a big story that will emerge.
      Snowy 2 will empower the EV evolution and again increase the value of the assets.
      Snowy as it is now creates opportunity for the new products.

      1. riley222 Avatar

        Can’t see Snowy 2 being anything but a positive for Oz. Things are changing quickly, sure, but as part of the new grid I congratulate Mal on having the fortitude to pursue it. Given the contra forces abounding on all sides it does show a level of real committment to renewables, a nice change to business as usual.

  3. Peter F Avatar
    Peter F

    Tassie hydro just released their lower cost 4 GW pumped storage plan for half the cost of Snowy II, but any more than 200-400 MW will require another Basslink. The problem with both of these projects is that they are based on existing generation and demand models which are just not relevant to the new paradigm.

    Home batteries are about the same real cost as televisions were at their introduction. Just say home batteries are taken up half as fast as televisions were. That would means that in 8 years time 70% of residences would have a battery. Some of them will be 500 W 2-3 kWh units most will be 10 kWh 5 kW and some will be multiples. So to be conservative lets say 45% of customers have 4 kW/10 kWh by 2025.

    Larger customers who are on peak demand charges have a huge incentive to install batteries to clip 10-20% off peak demand. For hospitals, hotels etc batteries can compliment or even displace emergency generators. For a commercial or industrial customer a battery makes money every day through arbitrage whereas a backup generator might make some money every 2-3 years Again lets imagine that there are 200,000 non residential customers with 20kW 100kWh

    Thus we could have 9,000,000 x 0.45 x 4 kW + 200,000 x 20 kW = 20 GW ( i.e. 10 x Snowy II) + 8 GW of hydro + a minimum of 4 GW of wind and solar + 10 GW of gas, i.e. 42 GW + whatever coal is still on the system. System peak this summer was 32 GW and it is falling.

    Another way of looking at it is that from now on 1/3rd of new solar installations have a battery and over the next 10 years half the existing plants install a battery That will be 1.5 m batteries only about 8-9 GW. By that time we still expect to have about 15 GW of coal and minimum solar and wind will be 2 GW, hydro 6 GW, gas 8 GW i.e. a total supply around 40 GW and by that time system peak will be down to around 29 GW.

    It is highly likely that one or two of the proposed SA pumped storage plants will go ahead, as will probably Kidston and I am pretty sure that Victoria will spend some of its $2b from Snowy hydro encouraging some grid storage here so there will probably be another 2GW in 100-400MW blocks around the country. None of them will need more than a few million in grid enhancements.

    While I think 2/3 rds of battery storage will be at or near the load, It just occurred to me that if Victoria called tenders in 2020 for big batteries they will probably be about 30% cheaper than the SA big battery. For $2 bn they would get close to 3 GW of batteries. With imports from Tassie, 2.4 GW of gas, existing hydro including continuing access to Snowy 2 GW of hydro and residual wind and solar that will be close to 9 GW peak capacity even if all the coal plants closed.

    I forgot that most solar and wind farms that are being built now are being built for or fitted with storage to avoid curtailment at periods of low demand or high supply grid congestion. That will probably bring another 1-2 GW of storage. On a slightly longer time scale 500,000 EVs will have 20 GWh of storage

    All in all except for one or two of the smaller hydro Tassie modules I don’t think either project will go ahead

    1. Alastair Taylor Avatar

      Thanks for that Peter F, interesting post!

      My first thoughts for how Dan Andrews, Lily D’ambrosio & Tim Pallas could spend the $2bil were on new storage closer to the generation but also secondarily perhaps directly investing in transmission to Western Vic to unleash the renewable ‘goldilocks’ zones both north and south of Ballarat (referring to the list of scenarios AEMO refers to in its 2017 Vic Annual Planning Report: https://www.aemo.com.au/Electricity/National-Electricity-Market-NEM/Planning-and-forecasting/Victorian-transmission-network-service-provider-role/Victorian-Annual-Planning-Report).

      In terms of Snowy just storing a majority of thermal energy – yeah, but just a casual look at the Vic Gov’s list of Wind Projects kind of makes you think it won’t take long for renewables to play a greater role: https://www.energy.vic.gov.au/renewable-energy/wind-energy/wind-projects (and that’s just wind, unfortunately Vic.Gov does have a comprehensive project status list for large-scale solar projects).

      ~200MW under construction with another 2,800MW in the pipeline (approved projects, some of them in that list already have PPA’s signed – i.e the 500MW stockyard hill) and another 400MW worth of projects are currently under planning assessment.

      Another 2000MW might enter that list under the planning assessment category if the business case development for the Star of the South offshore farm comes back position for its developer.

      On Aussierenewables map of projects, I counted roughly 800MW of large-scale solar projects up in the Mallee/Goulburn Valley/Murray region as a whole which are at a planned status and there’s three under construction which will produce once all phases in project’s case are done, that’s about 400MW of solar power.

      All that potential new generation shifts the focus back on what will happen with transmission across the figure 8 network in Western Vic (with Ballarat at the centre of it).

      I think it’s fair to say that from Victoria at least, the energy mix will shift a heck of a lot before Snowy 2.0 is ‘up on blocks’. https://uploads.disquscdn.com/images/d80c9292e6c97c5df082860b6934befc144818dade7acf160971e574e7aced56.png

      On the storage side, a bit of the new cash should go to doing more in-depth studies of the sites highlighted by the ANU – there’s some very interesting sites located above Lake Thompson on the eastern massif of Mt Baw Baw just north of the La Trobe Valley – there’s oodles of transmission capacity about 50-100km south of that region (and it makes sense transmission from PHES on Baw Baw would connect with the grid at one of the LV sub-stations) and it’s located close(ish) to the Star of the South plus also a very large workforce that will need transitioning once Yallourn shuts down and ditto – but later on – when Loy Yang have passed their useful economic life.

    2. Rod Avatar

      In addition to that most new solar farms have tracking and as we have seen in Vic with FiTs favouring peak periods, solar will eat further into the peak even without storage.

      1. Ian Avatar

        Either set of projects is valuable, especially given that Victorian gas prices are set to go through the roof as the Gippsland gas supplies dry up. 2018/19 is already forecast to be short of demand.

  4. Peter F Avatar
    Peter F

    This project adds to the NBN and the Naval Shipbuilding fiasco to Malcolm’s list of catastrophes. A round $100 bn or so of waste. I used to think Tony Abbott was our worst PM ever, he is being severely challenged for the title.

    1. david_fta Avatar

      Did someone mention Tony Abbott? It’s not just Energy policy that needs to be handled with more care than a screaming Rugby front-rower using his brain as a battering ram can manage. Here’s a short list of other issues where Mr Abbott’s help may not be required.

      Administration of Justice and Legal Affairs,
      Agriculture and Water Resources, Communications and the Arts,
      Education and Training,
      Foreign Affairs and Trade, Health,
      Home Affairs
      Human Services
      Industry, Innovation and Science
      Infrastructure and Regional Development
      Jobs and Small Business
      Social Services
      Prime Minister and Cabinet
      Veterans’ Affairs

    2. Robert Massaioli Avatar
      Robert Massaioli

      It’s not the person, it’s the party. Every party will swap the leaders at the drop of a hat apparently; but a change of head does not change the party’s direction.

      1. Ian Avatar

        That’s why he wants to be the neck.

    3. Jaquix Avatar

      Turnbull at it again. What a despicable sneak he is.

  5. Roger Franklin Avatar
    Roger Franklin

    First NBN and now Snowy 2.0. The Turnbull train wreck continues!

    1. Joe Avatar

      And time for plenty more ‘carriages’ to hitch to that train.

  6. Chris Fraser Avatar
    Chris Fraser

    While Snowy 1.0 generates original source energy, I don’t see Snowy 2.0 as being much besides storage. It will only store and resend 0.85x the energy emitted by someone else … until it rains a bit in the Tantangara catchment.While we point out that a federal Government is becoming more involved in the storage business, we should keep in mind it will all belong to another Government one day. Let’s hope they’re not into joining with the Incumbents in screwing us over.

    1. Cooma Doug Avatar
      Cooma Doug

      Each drop of water that hits the snowy mountains is allocated by law to emerge as an asset of the state it falls in. Higher than normal rainfall is released in a controlled fashion .
      The basic rule is that the water must emerge from Snowy via NSW and VIC river systems as it would had the scheme not been built.
      Snowy 2 will not impact the “pre SMA” rule and it fits it like a glove.
      It is not a simple matter to compare this project to smaller storage schemes being considerred. Main reason being that most of the hard stuff has been done.

      If we are comparing it to construction of 20 or so new smaller systems around the states, it is just not in the same ball park in terms of cost and environmental management.

    2. Gold Platinum Avatar
      Gold Platinum

      I have built a lot of lithium battery packs for ebikes and quad ebikes. They don’t last forever.
      Just look at the official cycles from Panasonic on their new 20700 lithium cells, the harder the draw the faster they die. This is why the typical draw on SA’s new Tesla battery is so light, they don’t want to kill it too quickly.

      1. Chris Fraser Avatar
        Chris Fraser

        I guess you mean Snowy 2.0 is a long lived and efficient asset, with the major operating cost being occasional replacement of pump/turbines to manage energy in the storage. It also seems to be in a fairly good spot between two significant consumers (cities).

  7. Carl Raymond S Avatar
    Carl Raymond S

    I think we should look at the bright side on this one. It’s storage. The water will be pumped with the cheapest energy available, which will be solar and wind, hands down, by completion date.
    Batteries may turn out to be cheaper, but this will last longer, in both years and hours of capacity. We can’t fight everything. Save the fight for calling for the end of coal, gas and exhaust pipes.

    1. Brad Sherman Avatar
      Brad Sherman

      I hope you’re right. Making this additional storage will be useful.

      But, my fear is that the govt will use the pumped hydro to extend the life of the existing coal-fired plants. I assume they’d be able to shift them from spinning reserve to production at very low marginal cost (assuming there is surplus generating capacity in the middle of the night from coal-fired plants). I certainly cannot see any new coal-generating capacity ever being financially viable but I fully expect to hear some tortured logic from the govt to justify continued burning of coal. It’s in their DNA.

      I can see no way of simultaneously reconciling Coalition commitments for emission reductions, lower prices and providing life support to the coal industry. Expect some very creative rhetoric during the next 5 years…

      1. Carl Raymond S Avatar
        Carl Raymond S

        Yeah, it’s an asset that can be used for good or evil. Good will prevail, because it’s cheaper. If we had to rely on some moral backbone from government (i.e. a carbon tax) we’d be screwed.

  8. Ben Avatar

    I thought the big problem with snowy 2.0 is that it’s better to have storage close to loads. The grid needs storage capacity, but it’s not as useful if it’s miles from the load and connected by a transmission system with limited capacity. Can someone enlighten us on this point?

    1. david_fta Avatar

      I think the idea is that Snowy Hydro will allow coal-fired power to chug along at baseload speed, with the variability in demand due to time of day and rooftop solar output balanced by pumped hydro. (Perhaps they’re also Dreaming that in years to come, baseload coal will be replaced with baseload nuclear).

      This could all be done at much lower capital cost by Tasmania, but that wouldn’t allow for a $4 billion swadge of taxpayers’ hard-earned landing in NSW Treasury coffers … where it will be used for Glad & Alan’s Temples of Sport, plus $1.5 billion change left over for child protection, the issue RECENTLY raised by NSW MLC Matthew Mason-Cox in the Fairfax media.

    2. Cooma Doug Avatar
      Cooma Doug

      A battery in Grenfell 30 k down the road is a product for that house.
      The same storage at ideal 330kv grid connection is much better investment and a product with greater earning potential.

  9. Kim Howard Avatar
    Kim Howard

    A lot of our technically challenged friends are jumping on the critical bandwagon. Battery versus large pumped storage hydro – a non issue. Is like comparing a rowboat with a ocean liner. The battery has its applications – but is 90 times the life cycle price per MWh. Need to remember that Snowy Hydro makes close to half a Billion dollars profit a year. Payback for the taxpayers (in all States) in about 10 years – plus a bonus for the original two States. A win for all. Snowy 2.0 was shown by our best professional engineers and economists in the Feasibility Study Report to be fully viable – based on internationally accepted project evaluation criteria. It has a life of at least 90 years – compared to 15 years for the battery. The nonsense about all the rock excavation and quantities stated by “experts” with absolutely no idea. In fact will be about 3 million cum total excavation and this rock material is already in demand for highway and concrete construction. It will be an asset and not a liability. So much other gumpf in the above article and would take dozens of pages to highlight all the nonsense. Needless to say, wind and solar will increase exponentially – and will need to as coal is phased out and electric vehicles are phased in. Snowy 2.0 plus the privately funded other pumped storage schemes such as Queensland Kidson Scheme will all be needed – and be profitable.

    1. Ren Stimpy Avatar
      Ren Stimpy

      Battery costs are dropping by 80% every six years. The cost of Snowy Hydro 2.0 power will be exactly the same in the long run if (as you say) it lasts 90 years from now. Face it, not much longer than after it’s actually completed Snowy is going to be disrupted by technology cost improvements.

      Nevertheless I am a supporter because at least it’s not nuclear or HELE which are totally unsuitable for this market and unfeasible.

    2. Cooma Doug Avatar
      Cooma Doug

      Kim Howard
      So glad to find you here. Im reading through the media stuff about Snowy 2, the comments here and there and thinking, God there must be someone else who gets it.
      Thanks for your words.
      The 400 mil PA has been significantly exceeded more years than not by the way.

      You would agree Im sure.
      We are moving into a load shifting market utilising storage and load side technology.
      The most significant point is the natural allignment of wind and solar. Wind excessive at night and solar in daylight. The large scale storage and load shifting technologies the bulk of the change and the vital finishing touch. The 90 years life of the pump storage is a huge benifit.
      There are a lot of benifits in the snowy project rarely discussed. The way it can integrate into the market and the range of products are huge.
      One thing that must be said here is that using Snowy 2 to pump coal will rarely happen.
      It is not economic. Load shifting of renewables is economic.
      There is much I can say here but I have been trolled by some anti wind nutters.

      1. Brad Sherman Avatar
        Brad Sherman

        Under what circumstances do you think load shifting would be economic for existing coal plants? I know from a friend at Windlab that wind farms can be economic with long term (20 y) PPAs at $70-80 / MWh (year-old conversation) with no subisdy/certificates/etc. I seem to recall reading somewhere that existing coal generation is around the $50/MWh mark. Without the renewable certificate market leading to essentially free power under some circumstances from wind/solar (i.e. middle of the day when generators can pay users to purchase the power for up to the value of the certificate and still have positive cash flow). New coal generation will come in > $80/ MWh, I suspect, so I agree new coal plants will never be economic. I’m just trying to understand what the status quo is.

        The major risk as I see it is the temptation to extend the life of existing fossil plants. The community needs to keep the pressure on government to ensure this doesn’t happen.

        by the way – I came away from a recent conversation with a friend of mine at the Global Carbon Project with the feeling that the GCP people are feeling pretty gloomy about society’s prospects for dealing with emissions. The recent uptick in global economic growth is already causing an increase in emission rates globally (after almost 10 y of more moderate emission rates) making attainment of any kind of warming target extremely unlikely under current business as usual settings. The only hope is to decarbonise energy systems as fast as possible (and I mean in an engineering, not a political sense). I was interested to learn that one of the greatest contributors to fossil emissions is the N. hemisphere space heating load in winter (I always thought it was aircon). Seems to me that the easiest (from an engineering perspective) way to put runs on the board is to stop burning coal for electricity. We know how to do it, we just need the will to get started.

        1. Cooma Doug Avatar
          Cooma Doug

          I know from experiance that storing coal generated energy has never been and never will be economic. Snowy 2 will not prop up coal. It will wedge it out.

          A question I heard a 12 year old girl ask her dad in 1973….her dad was the manager of NSW Electricity Commission System Control. I was driving him from Yass NSW control centre to the Carlingford control centre for a meeting about a major black out. I was a third year aprentice. He was telling me as I drove, his views on the big black out that week.

          His daughter interrupted the conversation with a question. “ Hey dad why dont you put a message out on the ABC radio when there is a problem and ask people to switch things off if they dont need it on? Why push the power down their necks if they dont need it? I thought it was a good question back then.

          Load shifting has always been a good idea. Now it can be done without the provider having to do anything and get paid for it. Snowy 2 is a platform for many products. It will highlight the value of other assets across the grid.
          It will be a thumbs down for coal.

    3. david_fta Avatar

      On the other hand, home batteries are kind of handy if you reckon the transmission line supplying your house might get blown over by a cyclone.

    4. Stephen Gloor Avatar
      Stephen Gloor

      Kim – so why are you so sure that in 90 years there will be enough water available to fill Snowy 2? All available data on climate change indicates falling rainfall. Bit of a white elephant if in say 40 years there is insufficient water and we are forced to choose between irrigation and power production. Mind you I would like to be in the room when this conversation takes place.

      1. Kim Howard Avatar
        Kim Howard

        Stephen – need to catch up with the technology. Pumped storage Hydro reuses the water. The losses are minimal and mostly small evaporation from the pondages – not much in the Snowy Mountains.

        1. Stephen Gloor Avatar
          Stephen Gloor

          Really? So where does the water come from? So you are telling me that the water in Snowy2 will not be available for irrigation.

          Why not do the same and catch up on the distributed pumped hydro being installed in old mines. Close to demand and not dependant on thousands of kilometres of transmission lines. https://arena.gov.au/blog/kidston/

          1. Kim Howard Avatar
            Kim Howard

            Stephen – two existing reservoirs – Talbingo and Tantangara will be directly connected (by tunnel). In non peak, pumping from Talbingo up and in peak, generating in reverse and back to Talbingo. No net gain or loss for either reservoir and irrigation outflows continue normally. In the worst 10 year drought Talbingo never got below 80%. More than enough water to operate Snowy 2.0 every day through the worst drought in recorded history.

          2. Stephen Gloor Avatar
            Stephen Gloor

            And this is the way it is going to be for the next 90 years? How about we decide to save the Murray Darling by increasing flows as rainfall decreases due to climate change? And as an Australian taxpayer exactly what benefit do I gain, from the taxpayers money expended, here in WA?

            “ 10 to 15% increase in annual rainfall is projected for northern NSW, with not much change (-5 to 5%) projected for southern NSW, and more than a 10% decrease for the Snowy Mountains for ~2070. There is a clear seasonal difference in changes with larger increases in rainfall in summer and autumn, and the greatest decreases in rainfall projected in spring, especially for the Snowy Mountains.”


            2070 is 50 years away. Do you really think this is a good investment when distributed pumped hydro could be built in disused mines in areas that are projected to get more rainfall.

            Also Snowy2 will only be charged by coal power. It would make far more sense to build out renewables first to 60 or 70% then at least Snowy2 will have something worthwhile to store. Give another 4 billion to Arena to seed out a massive renewable build out as they have shown to be extremely effective at.

        2. Peter Davies Avatar
          Peter Davies

          The exception to the “small losses” is using Tantangra Dam where the groundwater system is flowing East to the coast whilst the river flows West (captured a few millenia ago when a Western draining river broke through the Eastern range). I was with a friend a few years ago who was one of the worlds leading hydro geologists & who pointed out to Snowy engineers that the water chemistry in some eastern streams that had increased their flow after the scheme was built was exactly the same as from Eucumbene Dam & had they checked their water balances? The response was “So that is where the water is going…”

      2. Joe Avatar

        Yes, Deutsche Welle ( Germany’s national broadcaster ) have posted an article about the now looming problem in Africa of changing rainfall. Africa has many hydro projects. The lack of water is now having impact on hydro produced electricity. Australia is not immune to changing rainfall.

        1. shinytop Avatar

          If this article in the Siberian Times is anywhere near correct then there is a fair chance SH2 will be lucky to be completed before the impact of those changes become all too real.


          1. Joe Avatar

            Nasty looking craters in the pictures.

    5. MarkH Avatar

      Finally some sensible comments. Was sounding like a high school level debate against snowy with a bit of conspiracy theory thrown in before you chimed in.

    6. MarkH Avatar

      Kim. Have you thought about being a journalist and writing renewable energy articles. I think you would be good at it. Wondering if renew economy needs someone. Certainly would up the standards. But then again what would the outrage bandwagon and conspiracy theorist and half baked armchair experts do with their time without out this sort of article to feed off.

    7. JWW Avatar

      Well, have you included the required billions in grid upgrades in your cost analysis? Those are not required for battery storage.
      And if it is such a great opportunity, why does is the private sector not finance and drive it? Why does it need government intervention?
      Batteries will be half price before the first shovel of dirt has been turned on Snowy 2.0.
      To me, this project is all about cementing (literally) the role of large, centralised energy generators/infrastructure to avoid the shift to decentralised generation and storage, owned by the many and not the few.

  10. AndrewATA Avatar

    Snowy 2.0 provides as much energy storage capacity as installing 2.6 Powerwall 2’s in every household in Australia, including apartments. The cost is only $400 per household. Pretty hard to beat that price with batteries!

    Snowy 2.0’s weakness is its power level. 2 GW equates to only 0.2 kW per household. However, this is still very useful in a fully-renewable grid. The challenge here is to get through a cloudy, calm week. 2 GW running for an entire week provides an important supplement to wind and solar.

    I think Australia should build Snowy 2.0, because it paves the way for a big rollout of wind and solar. It shuts up the people saying “you can’t do that, because there’s no energy storage to back it up”.

    1. Stephen Gloor Avatar
      Stephen Gloor

      But what does say North Queensland do for storage. Are the requisite transmission line being built or is more pressure just going to be put on the already overloaded transmission lines? The 2.6 Powerwalls are at least at the point of consumption and involve much less transmission losses. Also Snowy 2 does absolutely nothing for us here in WA. A big investment in smaller distributed pumped hydro and batteries would drive down the cost for all Australians not just those of you fortunate enough to to live in NSW or Victoria.

      1. AndrewATA Avatar

        Well we need a proper long-term plan for the energy transition. A good starting-point is the ANU’s one*, which includes a new transmission “backbone” to transport renewable energy around the NEM.

        Snowy Hydro 2.0 doesn’t cover the full energy storage requirement as estimated by the ANU. Yes, distributed pumped hydro is a great idea. More expensive than SH2.0 though, as the reservoirs don’t exist already.

        Sorry – this doesn’t address WA. We need a proper plan for you guys too!

        * http://energy.anu.edu.au/files/100%25%20renewable%20electricity%20in%20Australia.pdf

        1. Stephen Gloor Avatar
          Stephen Gloor

          Yep you are right there – we are usually forgotton. We do need a transmission backbone however more to connect renewable energy centres.

          There are thousands of disused mine sites that can be converted to pumped hydro. Even if just a few are suitable it still would work out cheaper than snowy2.


          The advantage of these is that they will be less vulnerable to storms knocking out transmission lines.

          1. Ian Avatar

            4 states and 2 territories could block this nonsense. Tasmania, Queensland, WA, SA, NT and Canberra. How are they going to benefit from this massive redistribution of their tax to Victoria and NSW? Sorry but this is a bullshit project. $6.2 billion to these 2 states as a handout by buying their share of the snowy company and then another $8 billion so that they can have a ReallyBigBatteryWhichWillLastForWeeksAndWeeksAndWillSoakUpAllTheSurplusCoalGeneratedElectricity.

            Let’s see $14.2 billion or so of federal funds, what else could we do with this petty cash? 142km of the Pacific Highway upgrade. Subsidising EV at $10 000 a pop: 1.42 million EV more than enough to gut the ICE market and make a transformative difference in Australia and in the whole world. Subsidise home battery storage at $5000 for a powerwall equivalent: 2.84 million homes participating in distributed storage all over the country including WA and NT and even Northern Queensland.

            If Turnbull wants a museum to 20th century technology then there have got to be some nice heritage-listed buildings in all major towns and cities where he could put his old copper wire telephone devises and some black and white pictures of the original Snowy Scheme for bored school children to look at on compulsory school outings.

      2. Kim Howard Avatar
        Kim Howard

        Stephen. Your “Snowy 2 does absolutely nothing for us here in WA” is a bit wide of the mark. Snowy Hydro now makes a profit of around half a billion dollars a year and will now be 100% Commonwealth owned – rather than most of the profits going to NSW and Victoria. Snowy 2.0 will increase the profits very substantially – with economic internal rate of return conservatively derived to be around 10%. A good investment project along with many other direct and indirect benefits.

        1. Stephen Gloor Avatar
          Stephen Gloor

          That is of course assuming it makes a profit in three or four years that it takes to build where the market landscape will have changed substantially. What market is it going for. By the time it is running batteries with millisecond response will have taken over FCAS. For peaking it is too big. How are you going to price the days of storage that it has into the peaking market which typically needs hours rather than days. Are you going to drain the upper lake to 50% so it can absorb extra energy and still deliver energy? I mean how is this huge resource going to work? Using it to load follow will probably not deliver enough revenue as the wholesale cost is too low.

          Again by the time Snowy2 is running the small tailored pumped hydro will be up and running with the appropriate amount of storage for peaking

        2. Stephen Gloor Avatar
          Stephen Gloor

          For some reason your reply got lost. This is the only bit that makes that I want to reply to:

          “With the rise of the renewables, peaking will be much less critical than the intermittent n ature of the renewables (as our non technical friends repeat ad infinitum – “when the wind doesn’t blow and the sun doesn’t shine”). Here we are talking about many hours and even days and storage or gas or conventional hydro is essential to maintain reliability”

          Days of storage may not be essential to maintain reliability nor is a huge remote pumped hydro project necessarily the best solution. Smaller projects and cheap OCGT closer to demand along with demand management will give greater reliability for the same or less cost and we over in WA may benefit as well with lower prices for equipment due to scale and the scale allowing overseas manufacturers to setup local facilities like Sonnen is doing. Remember this whole project can be rendered useless by one transmission line overloading.

          “The SA battery is 129 MWh and can power 50,000 homes for 1 hour 18 minutes. Snowy 2.0 will have energy of 350,000 MWh – sufficient to power 3 million homes for 7 days (2,713 times the energy of the SA battery at an approximate life cycle cost of about 1% per MWh).”

          I am pretty tired of my battery is bigger than your battery arguments. Its not the point as the saying “it is not the size that matters but what you do with it” hold true with storage. The battery can respond in milliseconds before Snowy2 can even start to react and will always outbid Snowy2 in FCAS. Sure it may be good to then be able to switch to Snowy2 but if the fault is in SA, then both interconnections might already be running at capacity and Snowy2 will be powerless to intervene. Are we going to reserve capacity on the interconnecter in future so Snowy can intervene?

          As great as it is, it is in NSW not where the demand is for most of the rest of the country whereas we could use the same money to build out smaller pumped hydro that are closer to demand. This way if the interconnecter trips the pumped hydro and batteries will be able to hold up the isolated grid.

          1. Kim Howard Avatar
            Kim Howard

            Stephen. Certainly not saying that the SA type battery or smaller one going in to Victoria are not worthwhile and big advantage in being able to come on line in less than a second. In fact I am putting up rooftop solar and Teslar 2 battery at the moment (when supplier can get Teslar stock). Now 6 months delay on new orders. The effect of household batteries I think has been completely under-estimated. I think we will get to 50% renewables in NSW within 5 years even without Labor’s assistance.

  11. Joe Avatar

    On one hand its wonderful to see Two Tongues Turnbull embracing his inner ‘socialist’ with the full buy up of The Snowy. The public / us already owned The Snowy, so now our hard earned is being used to ‘buy’ it ( 87% share held by NSW & Vic ) again. How does that work? Looking forward to new announcements from the Two Tonguer in aquiring more…. public assets. On the other hand is Snowy 2.0 just a giant snow job to boost Two Tonguers non existent RE credentials or will Snowy 2.0 turn into a giant White Elephant?

  12. Robert Westinghouse Avatar
    Robert Westinghouse

    Turnbill, now owns Snowy. He can sell it his banker mates without any agreement with the States. This is BAD. Conflict of interest, never worries Trumbill and his corporate mates. Profit, Profit and More Profit at the cost of normal people – the Trumbil Way….

  13. James Wright Avatar
    James Wright

    Yet another disaster in the making by the COALition government. Much more tax payer debt to set up another project that does not add up.
    It looks like consolidating ownership is just setting it up for another privatisation to their financial sponcers or to overseas investors.
    What is up with this totaly inept and morally corrupt group of individuals that claim to be a government but dont have the skills to do anything but look after their self intrest?

    1. nakedChimp Avatar

      Well, they obviously got good PR people, otherwise they wouldn’t be in that position, rite?

      1. James Wright Avatar
        James Wright

        Yes a great PR team, having the Murdock press fully supporting them realy helps getting elected.
        Even with the mining industry funding their election campaign they only got in by one seat. The sad part is they are selling us out to big business and non tax paying overseas corporations. I fear for my children’s future when all of our assets are gone.

        1. nakedChimp Avatar

          We just dig a bit deeper for the rare stuff and will manage with the common stuff and high tech like everyone else around the world.
          The most important resource a country has is it’s people and the ones you can attract who want to live, work and contribute here.
          The better your education system, the more smart people you have that enjoy and embrace living there, the better off it will be.

          The key to that is to abolish the control of monopolies by private interests in all of it forms – be it patents or infrastructure or money to name a few. There is just no way around it.

  14. Gold Platinum Avatar
    Gold Platinum

    The only reason reneweconomy is against Snowy 2.0 is due to the fact they are just arm of the energy companies that just want to rob Australia blind on high expensive electricity prices as this Snowy 2.0 run by the government to stabilise prices hurts their goals.
    Snowy 2.0 is 35 million 10KW/h Tesla Powerwalls in one go, and truly renewable.
    If you don’t want to believe that then please look at some real news sources that claim 20 times more cobalt comes from the DRC than any other country on average and ALL Tesla batteries contain cobalt which is a crucial ingredient for high performance long lasting lithium cells.
    Which is largely dug up by children, working like slaves, why would you want your taxpayer money funding this?

    1. david_fta Avatar

      Plenty of cobalt in nickel laterite deposits in Australia.

      Regarding home batteries instead of grid-connected storage, home batteries are superior because they’re competing against retail power prices whereas Snowy Hydro would be part of wholesale power supply. In fact, home batteries are part of home-owners flipping the bird to the energy retailers on whose behalf you reckon Renew Economy is writing.

      BTW: thanks for the link to a NewsCorpse (network of choice for science Deniers) story.

      1. Gold Platinum Avatar
        Gold Platinum

        Did you even read the Bloomberg article or are you unable to click on URLs? Obviously you can’t..
        Just look at their chart then in the article your supposed to read, despite all the efforts cobalts price has been massively increasing, even with all those African kids digging it up for a meal a day.

        1. david_fta Avatar

          Did I click on the report? No I didn’t. No need to, since the fact that cobalt is presently unethically sourced in no way rebuts the general case that home batteries are a good idea – as soon as I can afford some’ll be installing them, but more likely to be flow batteries (Redflow, Aquion, VSUN &c) rather than Li.

          I argue against your other points as well – anything to say in response?

    2. nakedChimp Avatar

      I don’t know where they did hit your head, but you probably didn’t see it coming, am I rite?

      1. Gold Platinum Avatar
        Gold Platinum

        So zero substance and just insults from you? Why not accuse me of being a Nazi, isn’t that the standard procedure?
        Why don’t you tell me how many MW/h, thats Megawatt Hours the Tesla truck battery size is. You might gain a window into if batteries are the future there is no chance in hell your going to be charging it all from your roof. And the real world generation statistics from the worlds biggest solar farms show your going to need to cover the world in solar panels to do it. And ask yourself this, this is CRUCIAL, the question is when you start covering the world in solar panels, how are you helping the environment, because that’s what it was originally all about.

        1. Stephen Gloor Avatar
          Stephen Gloor

          Unless you haven’t noticed the world is covered in self replicating, nano basedsolar collectors and is entirely powered by solar energy. We call them plants and without them this discussion would not be possible.

          The amount of sunlight that falls on the Earth would enable us to to be entirely solar powered including the cars trucks etc with an area the size of Spain.

          This of course is ridiculous as we would use a combination of renewables however they are all powered by the sun.

          1. nakedChimp Avatar

            Not all, tidal wave energy is powered by the momentum in the moon-earth system, as is geothermal heat (which to some degree also relies on radioactive decay) 😉
            Both are non-renewables resources btw.

          2. Stephen Gloor Avatar
            Stephen Gloor

            Yes technically correct however neither you or I can eat much that gets its energy from tidal or geothermal.

          3. Gold Platinum Avatar
            Gold Platinum

            It’s easy to get yourself out of the cave and USE REAL WORLD DATA to calculate it yourself in SECONDS instead of walking around like a clueless fool. All the data is on the eia.gov conveniently summarized on Wikipedia on renewables.
            Topaz Solar Farm in the sunny desert of the USA. 25km2 sized. ( https://en.wikipedia.org/wiki/Topaz_Solar_Farm )
            2016 annual generation: 1,265,805MWh
            Average power 144MW = (1,265,805MWhours / 8760_hours_in_a_year)
            Average coal or nuclear power station: average output 3927MW = (34,402,000MWh / 8760)
            3927MW / 144MW = 27 times more power.

            So 25km2_solarfarm x 27 = 675km2 of land covered in solar panels to generate the same average power. You have a super huge battery as well, that will require a lot of land and a lot of energy to dispose of once used.
            No real environmentalist who is worth a damn wants to cover that much land to replace a >single power-station< like this environmentalist is saying https://www.youtube.com/watch?v=EJ8L9EAWF3E

          4. Stephen Gloor Avatar
            Stephen Gloor

            How much of the world do you think we have covered in roofing? Or roads or parking lots? Nothing in solar precludes dual use – just shading car parks would give most of the area.

          5. Gold Platinum Avatar
            Gold Platinum

            Thats the problem with solar, it seems to capture so many peoples imaginations but with garbage information. Simple fact is, if its all so easy and great why hasn’t it happened yet.
            It’s like tidal wave or even geothermal, if you look at https://www.electricitymap.org/?page=country&solar=false&remote=true&wind=false&countryCode=IT the total geothermal generation around the world it is tiny, let a lone specific to an area.
            Tired of the “oh you will see” after so many years.
            Do you know how much CO2e is released creating solar panels? Its more CO2 than Australia’s entire coal power-station emissions.

            Must read EPA page https://www.epa.gov/f-gas-partnership-programs/semiconductor-industry
            Solar panels are just giant semiconductor arrays https://www.youtube.com/watch?v=ETN709TgUnk

            10,000_tons_a_year_NF3 x 17,200_times_greater_than_that_of_CO2 = 172,000,000 vs 151million tons of co2 from Australian coal power-stations.
            All these gases are monitored and you can bring up the live charts to see they are increasing every month.

        2. nakedChimp Avatar

          Total Surface Area Required to Fuel the World With Solar


          Yes, that’s for ALL of the energy we use, inclusive heating.

          As for early adapters and early stages of tech – what is your point?
          That is still has some way to go to be able to handle all the creature comfort and range at the same time in extreme environments?
          Wow, they should give you some price. I never would have expected this.

        3. solarguy Avatar

          I have a 9.3KW PV system which very frequently produces more power than the household can use and the excess is sold to the grid after the batteries have been charged and all the while supplying all loads in the process, including the air conditioners.

          Yesterday my solar produced 43.6kwh and it was a partly sunny day. 20.5kwh was sold to the grid, profit $2.56.

          From that 43.6kwh produced the household used 23.1kwh.

          The house isn’t covered in PV, only the North side is and the West side of my shed.

          We won’t need to cover the world in solar panels, far from it!

          What I can’t stand about you trollies is that you never get your facts right or you vomit misinformation!

          Now, I won’t call you a Nazi, but like the Nazi’s your a deluded dickhead!

  15. Radbug Avatar

    There’s a real chance that, if/when US 10yr T-bond rates go to 4%, and the Australian property market tanks and all those plumbers with 6 apartments on interest-only loans, go belly up, taking the banks with them, and those banks go screaming to ScoMo to honour Wayne Swan’s bond guarantees, the government of Australia’s credit rating could look like Venezuela’s. And all this, made worse by the imminent Indian banking system catastrophe, will happen before Turnbull has to go the polls in 2019! Bankruptcy is the fate of all socialist governments.

    1. nakedChimp Avatar

      Bankruptcy is the fate of all socio-economic systems, which use a monopolistic, not-circulation-protected fiat money, that has got a zero lower bound interest problem.
      Monopolies in market economies have only one outcome – disaster for everybody involved.
      So shove the ‘socialist government’ remark where it belongs, as you have no clue what you’re talking about.

  16. Brunel Avatar

    He is only buying it so that he can privatise it!

    And if NSW and Vic are ok with owning Snowy Hydro 1.0, why are they not ok with owning 51% of SYD and MEL airports?

    1. Alastair Taylor Avatar

      …Tullamarine: Commonwealth acquired the land and built the original airfield + facilities, never had anything to do with State governments.

      1. Brunel Avatar

        But the state is expected to pay for a railway to that airport. Along with the never ending widening of the toll road that people use to get to the airport.

  17. Paul Avatar

    The Turnbull government is not the only one that appears to be moving towards, or in, a financial conflict of interest with energy users. For example, see p13 of the “Victorian Renewable Energy Target 2017 Auction Industry Info Session” slide pack at the link below. The chart labeled “How a Contract for Difference Works” (adapted from WRI 2004) seems to show that the state will get a financial benefit from higher wholesale spot market prices.

  18. Electric Boogaloo Avatar
    Electric Boogaloo

    For a website that’s supposedly pro-renewables you sure do seem to have it in for Snowy 2, despite it being much more economically viable than batteries.

    You don’t seem to have it in for other pumped-storage hydro projects though. Is it because Snowy 2 is being proposed by the Liberals or is it because Snowy Hydro doesn’t “sponsor” this site?

    1. vielepunkte Avatar

      It‘s because snowy 2 doesn‘t have much power output compared to the cost.

      1. Electric Boogaloo Avatar
        Electric Boogaloo

        It has days worth of energy storage though and that’s the whole point of it.

        Cast your mind back to just a mere handful of months ago where there was a “wind drought” and wind power output was consistently low for a stretch of weeks. That’s what it’s for.

        The alternative to that is a massive overbuild of generation capacity or battery storage, which will cost much, much more. Or burning fossil fuels, which I’m guessing everyone here is completely opposed to.

    2. Giles Avatar

      that’s pretty offensive. I don’t see any battery storage people sponsoring this site either. Read the story, that explains why we have questions.

      1. Electric Boogaloo Avatar
        Electric Boogaloo

        I did read the story. That’s why I posed the question. Your offence is irrelevant, but perhaps a sign that I’ve struck a nerve.

        This site has a consistent theme of being venomous and vitriolic towards anything the federal government says or does.

        Again, why don’t you demonstrate the same level of vitriol towards other pumped hydro projects, or for that matter all renewables projects that depend upon government funding?

  19. Craig Allen Avatar
    Craig Allen

    When the cost of new wind and solar drops below the cost of established coal generation, why would they want to use coal generation to power Snowy 2.0?

    And given that it will only have a 2GW output (in system that requires 30-35GW), won’t that mean that a lot of other storage will be needed regardless.

    Besides, the Liberals won’t be in power forever, so Labour (+Greens) will eventually be able bring in policies that encourage renewables.

    So I suspect that in the end Snowy 2.0 will be a useful asset in the system, one tool among many that enable us to advance toward 100% renewables.

  20. Ken Fabian Avatar
    Ken Fabian

    More renewables is what Snowy 2.0 is for – despite it being an LNP policy I think we need to remind the LNP of that because they don’t appear to understand their own policies. More renewables should be built in anticipation and arguments about lack of storage should be countered by citing glorious expectations of Snowy 2.0, over and over, as often as necessary.

    Whether it goes ahead or not isn’t immediately important – batteries will, whether our government expects or believes it or not, give us room to continue the RE transition ahead of any irrevocable decisions about how the zero emissions end game will be dealt with.

    I think the anti-RE, pro-coal zealots have been snookered by one of Turnbull’s thought bubbles – but by accident, not intent.

  21. brucelee Avatar

    I’m curious, would this be considered picking winner’s OR technology agnostic?

  22. Andrew Scott Avatar
    Andrew Scott

    I had to read this article a couple of times – it’s tone is extraordinary!
    So you say the function of Snowy 2.0 Hydro is to war against the domain of batteries? A competing domain??

    Could the logic underpinning this revelation, be used also to imply that the function of Supertankers is to war against their ‘competition’ – the fishing trawlers, pleasure craft, canoes and paddleboats?
    Could it be used to infer that Heavy-Haul rail consists with 100,000 tonnes of iron ore on board exist to war against B double trucks, one tonne utes, family sedans and golf buggies?
    Of course the answer to these two rhetorical questions is NO.

    There are many varied functions, sizes and locations for diverse energy storages to play complementary roles in a sustainable energy system that extends right across the Australian continent.

    Perhaps it is time to make a cup of tea and sit on the back veranda for a calming couple of hours before writing the next article about large scale pumped hydro electric facilities and the way they will support the future Sustainable grid.

    1. Giles Avatar

      well, may be you should have another cup of tea and read it again. It’s not RE that turned the debate into an us-and-tehm, pumped hydro or battery storage, it is snowy hydro, and we find that extraordinary.

      we have actually written in support of pumped hydro, and written enthusiastically about projects in queensland, nsw and south australia. we don’t join the chorus line for snowy 2.0 because they haven’t yet justified it, or released their economic analysis. now it is owned by government, who set the rules and policies. we think this is a cause for concern.

      Now, if the Coalition were suddenly to announce policies that would encourage 50% renewables by 2030, we might start to look at it differently. But they have made it clear that is the last thing they would do.

      1. CsabaU Avatar

        Giles, Now it is far too much emotions. We do lack clear arguments that shows that Snowy 2 is over-priced compared with alternative pumped hydro projects.

        1. RobertO Avatar

          Hi CsabaU, where is a proper business case and the much needed details? I know that political interference can cause problems, New Zealand has had PH for 50 years and in 1978 pollies decided that the Coal Power Station Meri Meri was too expensive to keep running so the pollies ordered it to be shut down to 8 hr standby. Meri Meri was used at night to pump water back up the Waikato river each night. About 12 months after Meri Meri stop production New Zealand North Island had power shortages as the river was no longer able to supply enough water. It took about 6 months of rolling stoppages after they ordered Meri Meri back into full production for the system to recover, and about 12 months for the river system to recover (Lake Taupo was drained to keep power going). The stupid point about 8 Hr standby is that you need to keep burning coal to keep the water in the boilers at 80 degrees C, so the Coal only saved about 5% of total costs over the 12 months.
          In terms of Snowy 2 if we had more RE and if the business case is positive then it may be a very good idea. Note that WA has had Demand Management since 2001 and yet SMC thinks it a stupid idea (Paul Broad CEO comments)

        2. Cooma Doug Avatar
          Cooma Doug

          I would suggest with confidence that all new
          relative small scale hydro storage systems will cost at least three times Snowy 2 per MWhr.
          The reasons are many.
          The environmental issues already dealt with, the head being near 700 metres is unique, the dams already constructed and existing water use

          Some of the small schemes I have seen discussed have potential heads only 25% of Snowy 2.
          This multiplies all costs per Mwhr by 4.

    2. Ren Stimpy Avatar
      Ren Stimpy

      Your intended rhetoric is accidentally fairly accurate. If a million homes, businesses and industrial buildings had their own powerwalls, demand on the grid would be so much lower we wouldn’t need so many “Supertankers” as we pay through the arse to have now.

  23. Glynn Palmer Avatar
    Glynn Palmer

    Snowy 2 won’t be operational and consuming energy until 2026/27. By the end of 2028 the following power stations will be in retirement:
    Anglesea Vic Brown Coal Capacity 155 MW emissions intensity 1.095 tonnes/MWh
    Liddell NSW Black coal Capacity 2000 MW emissions intensity 0.981 tonnes/MWh
    Dry Creek SA OCGT Capacity 156 MW emissions intensity 1.343 tonnes/MWh
    Mackay Qld OCGT Capacity 34 MW emissions intensity 1.046 tonnes/MWh
    Torrens Island B SA OCGT Capacity 800MW emissions intensity 0.681 tonnes/MWh
    Newport Vic OCGT Capacity 500MW emissions intensity 0.57 tonnes/MWh
    Vales Point B NSW Black coal Capacity 1320MW emissions intensity 0.908 tonnes/MWh
    Wallerawang C NSW Black coal Capacity 1000MW emissions intensity 0.915 tonnes/MWh

    That is 5,965MW of capacity that will be replaced by renewables by the time Snowy 2 is consuming energy to pump up hill.

    During 2029-30 the following power stations will be retiring:
    Jeeralang A Vic OCGT Capacity 232MW emissions intensity 0.879 tonnes/MWh
    Gladstone Qld Black coal Capacity 1680MW emissions intensity 0.972 tonnes/MWh
    Jeeralang B Vic OCGT Capacity 200MW emissions intensity 0.879 tonnes/MWh
    Yallourn Vic Brown coal Capacity 1480MW emissions intensity 1.316 tonnes/MWh

    That’s an additional 3,592MW of capacity that will be replaced by renewables soon after Snowy 2 is operational.

    Then there is an additional 7,010 capacity that will be retiring in the first 5 years of the 30’s.

    So planning now for storage and FCAS capacity to complement that additional 16,567MW of renewable capacity by the end of 2035 is sensible and responsible

  24. Warner Priest Avatar
    Warner Priest

    The real issue with Snowy Hydro 2, is the fact that it is a centralized form of energy storage and dispatch, versus that of a leaner more agile distributed form.
    A techno Economic modelling assessment should be done taking into account the full impact of a project of this nature. With this pumped hydro scheme being centralized, it needs to have strong interconnectivity to the loads it serves and low cost generation that charges it, (renewables). The cost to augment the grid and the upkeep has to also be considered.
    Australia is a big country with a very small population, pockets of which, distributed around 7 major cities. With this in mind, Distributed Energy Systems would likely be a more cost effective, more reliable solution for Australia’s answer to serving its energy needs.
    More battery storage is the trend worldwide, this would result in the export of our minerals, hence a growth in our mining sector.
    More distributed renewable generation could start a new industry around hydrogen production and renewable fuel export, the jobs created around this could be immense. Hydrogen production is very similar to Pumped Hydro. Converting low cost energy that cannot be absorbed into the energy system, to stored energy. Using electrolysis, splitting oxygen from hydrogen that can then be stored and dispatched as energy when required is in principle the same as pumped hydro. However, the production of hydrogen is not geographically limited, it can be distributed, it can help to decarbonize our gas networks, our transport sector, it can decarbonize other industries like steel, ammonia production, the textile industry and much more. It can also address constraints in the grid at multiple distributed locations around the country, a phenomena that will become more prevalent in an energy system with a higher % of renewable penetration.
    The biggest opportunity is job creation off the back of a potentially large scale renewable energy export industry that could rival our very own LNG industry in the long term, feeding markets like Japan, S.Korea, Singapore and China, leveraging one of our most competitive and abundant natural resources, our renewable energy.
    Is this not where we should be directing our $6 billions worth of funding?
    Snowy Hydro 2 is akin to that of the NBN (large centralized energy dispatch requiring strong and robust transmission grid interconnectivity over a very large area serving a small population), versus our pending 5G roll out, (lots of small distributed systems requiring far less labour intensive interconnectivity) .
    A large centralized scheme of this nature would take years to build, when in fact we need a fast and agile uptake of more Distributed Energy Resources, that would lead to the creation of jobs for more Australians in all sectors at all levels.
    All forms of energy storage are important, the question is, do extremely large centralized systems of this nature make sense, or would many medium to small distributed systems be a better choice for Australia?

  25. Toby Jones Avatar
    Toby Jones

    I think the move is brillant!! Buying the states out gives the Feds control and a strategic stake in the energy market allowing it to ensure continuity over the potentially volitile transition period coming in the next 20 + years as battery and storage systems come on stream and the old Coal generators are closed. Reliable supply is to critical to allow free market doctrine to prevail. What is absolutely amazing is that this is coming from the free market evangalists.

  26. Justin Howes Avatar
    Justin Howes

    Please stop hating on Snowy 2 guys… at the utility level for the foreseeable future, battery storage is only good for extremely fast response to support a wonky grid frequency… (but note, AEMO could easily fix it’s crappy frequency quality by having decent standards for “governor / automatic control” of the grid locked generators that already exist). The Back Room Deal – Elon Musk – Lets Build a Battery in Adelaide – No Horsdale – Power Reserve Project, at 129 MWh is only going to back up a typical Wind Farm for about 30 mins total !! not even a blip… as much as I love everything Elon does, there is still a place for Snowy 2.0 and Tasmania as the “Hydro Battery of Australia”… If the government does not build it, no one will, and for sure we need these schemes for a renewable future… Much Better than Open Cycle gas…

  27. Alex Hromas Avatar
    Alex Hromas

    Worth noting Snowy 2 will take about 15 years to build i.e. start generating in 2033 the time that Snowy Hydro recons it will be needed. The problem is that both the Lib/Nat’s and Snowy Hydro are driving down the energy highway while using the rear vision mirror as the only guide e.g. up till very very recently hydro plant with a response time of 15 min was the fastest kid on the block. Fine when you had lots of rotational inertia form steam turbines and their alternators to hold frequency steady. No longer the case our current crop of renewables, wind and PV has very little of this and this is where batteries win hands down with response times of fractions of a second. It was this need for a lot of rotational inertia that set the limit of renewable penetration at 20%. No longer the case even without batteries. As Bob Dylan sang “The times they are a changing” and Turnbul and Co. have not noticed

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