Costs blow out for Turnbull's Snowy dream to push coal power uphill | RenewEconomy

Costs blow out for Turnbull’s Snowy dream to push coal power uphill

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Snowy 2.0 or Snow Job? Costs for Turnbull’s pet scheme more than double, the economics are kept secret, and project may do little more than use coal power to push water up hill unless Coalition seeks more wind and solar.

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Snowy 2.0, or Snow Job? Prime Minister Malcolm Turnbull has given gushing praise to his pet project, the Snowy 2.0 pumped hydro scheme, despite its soaring costs, questionable economics, and fears it may do little more than use coal power to push water uphill.

The feasibility study was partially released on Thursday, revealing that costs for the proposed 2GW, 365GWh pumped hydro scheme had more than doubled from $2 billion to a range of $3.8 billion to $4.5 billion.

The costs could rise more, depending on whether it can overcome serious engineering hurdles that it has not yet analysed, and if it needs a bigger shovel.

These costs do not include the cost for new poles and wires into Victoria and NSW, which would add another $2 billion to be paid by consumers.

A final investment decision will not be made until late 2018. But analysts question how it could possibly work, unless it receives significant payments for acting as “reserve capacity” – most likely through the proposed National Enegy Guarantee.

It reinforces the view that the NEG is a scheme designed with a specific purpose – to support Turnbull’s vanity project, as we wrote a month ago. Crucially, chapters on the scheme’s economics, detailed costs and business case have not been released.

Clearly, though, the board of Snowy Hydro – whose shareholders include the federal, NSW and Victoria governments – see the project as an “us or them” proposition – the “them” being competitors such as battery storage, other pumped hydro schemes, or the smart technologies they did not even mention: demand management and energy efficiency.

The glossy booklet and feasibility study suggested Snowy 2.0 could use excess wind capacity overnight to pump water uphill to reservoir, before letting it down again to spin turbines and generate electricity for use at times of peak demand or higher prices.

But Australia is a long way off having such significant amount of excess wind, or even solar capacity, as ITK analyst and RenewEconomy contributor David Leitch explains here.

“As the NEM is current configured Snowy 2.0 will increase electricity demand, and increase CO2 output,” Leitch writes.

“Of course, this would could change in a largely renewable world but at first blush when renewables penetration is 20-30 per cent there is a 60-70 per cent chance of pumping being powered by coal.”

Turnbull’s NEG proposes no little or no new wind or solar in the decade from 2020 to 2030, and his government made it clear this week there would be no change in policy or emissions targets.

Currently, about 5GW of wind and solar has been committed or financed to meet the renewable energy target, but this won’t be enough to drive Snowy’s pumps, and the industry faces an investment cliff unless the NEG design is changed significantly, and emissions targets ramped up.

Energy analysts say the idea of a large pumped hydro scheme is not a bad one. Indeed, RenewEconomy wrote back in March that it was a potential turning point in the energy debate, particularly its focus on “dispatchable rather than “base-load” generation.

But that assumed a willingness to use the project to push for more renewables, and there is no evidence of that in government policy then, or since.

Chris Dunstan, from the Institute of Sustainable Futures, says the feasibility report’s claim that Snowy 2.0 can enable new wind and solar “in a manner not otherwise economically achievable” is simply not true.

Demand Response and time varying prices would be much more economically achievable, Dunstan says, in the same way as they would for replacing the Liddell coal generator.

“Snowy is likely to increase the carbon intensity of the energy market, at least in the short to medium term as Snowy 2.0 will most likely be powered by coal not renewable energy,” Dunstan says.

“In summary, there may be a case for Snowy 2.0 when we reach say  greater than 50 per cent renewables share of generation,  and we have used other cheaper flexible resources first.  But this is not so now and is unlikely to occur before 2030.

“If we really want more flexible capacity now, then let’s have a transparent competitive process to find the lowest cost solution.  And isn’t that what the NEG is supposed to do?.

Analysts also question, however, the economics of lumping so much capacity in one place, and why so much is needed if Australia continues to portray renewable energy levels of 50 per cent or more as “reckless.”

This was a theme taken up by Labor’s climate spokesman Mark Butler, who pointed to the total costs of at least $6.5 billion, likely increases and delays, and its likely support of coal under Coalition policies.

“The feasibility study also makes it clear Snowy 2.0 should be linked to Renewable Energy Zones – a Labor policy to support our 50 per cent renewable energy target that the Government has refused to endorse,” Butler says.

There are also questions about government intervention here, and how it can be financed. The document says the project will only work if it stops paying dividends to its government owners – so there is an effective tax-payer subsidy.

ITK analyst David Leitch says it is clear that Snowy 2.0 could not operate in the “merchant market”, it would not be able to make much money. So it will almost certainly rely on long term “reliability” contracts being contemplated by the NEG.

It puts the federal government in a clear conflict of interest – it is proposing to design and legislate a scheme whose biggest beneficiary is likely to be its own asset. No amount of fluorescent shirts and hard hats can overcome that issue.

Energy minister Josh Frydenberg however, insisted that the scheme would push prices down overall, and would add to the value of solar and wind power.

Some observers agreed, noting that the costs to the system would be significantly cheaper than, say household solar and battery storage.


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  1. WR 3 years ago

    $4 billion dollars for 365 GWh of storage is actually very cheap. As a comparison, the 129 MWh Tesla battery in SA probably cost about $80 million. You would need 3000 of these to have 365 GWh of storage. That would cost 3000 x $80M = $240 billion. Let’s assume that prices fall by 50% in the near future. That still leaves a cost of $120 billion. So $4 billion seems incredibly cheap in comparison. Of course, this is because the new Snowy project is taking advantage of the money already spent when making the existing dams and hydro power system.

    One of the questions that should arise is how much use you are going to get out of that 365 GWh of storage if the generators can only provide 2 GW of power. At 2 GW, 365 GWh of storage provides approximately 180 hours of continuous supply before needing recharging. That is 8 days of continuous supply! Anyone with an off-grid PV+ battery system will tell you that you might only need 8 days of supply from the battery once per year, or once every 5 years! And that’s an isolated system that relies on only 1 mode of generation, the PV panels! So it’s difficult to see how the grid would ever use anything close to 365 GWh of storage if the output power is limited to 2 GW.

    • George Darroch 3 years ago

      If you were siphoning excess over a period of weeks or even months, that amount could be easier to come by.

      • WR 3 years ago

        You wouldn’t need to siphon it over months. There would be no period of more than a few days where there wouldn’t be more than enough surplus supply to start recharging the system. In a system where there is large amounts of PV, even in the middle of winter you will get excess PV supply during any sunny day. And when you take generation from wind into account, the periods when there isn’t excess supply are very limited and of short duration.

        • David Osmond 3 years ago

          Fully agree that the 2 GW of additional generation is unlikely to utilize the 365 GWh of storage. However, if they end up upgrading it to 8 GW, as I’ve seen mentioned a couple of times now, then that could take a bit more advantage of those 365 GWhs.

          • WR 3 years ago

            Yes. I was wondering if there were plans to expand the generation capacity. Because it’s being built underground, I thought there might be limits to the space available to install turbines and generators.

            With 365 GWhs of storage, they should aim for at least 4 GW of generation capacity.

          • Mike Westerman 3 years ago

            Bear in mind they haven’t done the EIA yet. The lower levels of Tantangarra are anoxic, with frequent algal blooms affecting the lake. Those toxic waters will mix with Talbingo. Warmer Talbingo water will tend to float on the top and release a significant amount of heat which is going to impact on the alpine environment around the lake. Redfin Perch will get thru despite the magic of electronic zappers in Chapter 17 of the FS and will end up destroying the trout there and in Eucumbene. The stirred up poor quality water is going to be released down into Eucumbene and hence into both Murray and Tumut schemes. And so it goes on…all in our most important national park.

          • MaxG 3 years ago

            Very good points!
            But in Orwellian times the environment minister has a different meaning.

          • Alex Hromas 3 years ago

            In suggesting an increase in capacity you forget 3 things. The snowy scheme has very large reserves of peaking power and enough pumped storage to handle excess wind and solar already. Large regulation of Tantangarra will result in considerable erosion of its shore line and stress the transfer tunnel system. You cannot quickly change levels in large bodies of water as to Coriolis force kicks in and spins the water around the reservoir. I was involved in a low head run of river station on the lower Rhone many years ago and the limit of generation was set by the rate of change of level in the lower reservoir, Saline des Vasch, governed by our old mate Coriolis

          • Mike Westerman 3 years ago

            8GW would turn over 20% of Tantangarra in an 8h cycle leading to serious environmental concerns for both lakes. And that would still only use a sixth of the storage capacity – definitely a mismatch between storage and installed capacity which ever way you look at it.

          • David Osmond 3 years ago

            Is there much difference between 8 GW for 8 hours and 2 GW for 32 hours, in terms of the environmental concerns of water mixing between the 2 reservoirs? Does the speed of the water discharge make much difference? ie, are you suggesting environmental concerns will limit the storage to much less than 365 GWh, perhaps to just 64 GWh?

          • Mike Westerman 3 years ago

            Definitely – 8GW is 1,600ton/s or the flow of a decent river and would turn that reservoir over. The speed of the water would be the same (for hydraulic reasons) so the area of discharge is enormous – think as wide as one and a half football pitches and 10m high into the deepest part of the reservoir to make sure you don’t entrain eddies when generating.

            But even 2GW for 8h a day will transfer EHN infected redfin from Talbingo to the whole of the upper scheme – Tantangarra, Eucumbene, to say nothing of increased turbidity and destruction of Murrimbidgee riverscape downstream of Tantangarra

  2. George Darroch 3 years ago

    Serious question: what’s the difference between this and Kidston?

    They both involve reservoirs and investment in new work. Kidston is 2GWh to Snowy 2’s 365GWh, so they’re obviously not on the same scale.

    • trackdaze 3 years ago

      About 5years and billions

    • Mike Westerman 3 years ago

      One important difference: Kidston will sell all that 2GWh almost daily, charged entirely by its 320MW solar farm, whereas SnowyHydro rarely even sells a full daily cycle of Tumut 3 let alone 365GWh charged by Victorian lignite. In other words, the lie is that Snowy 2 is cheap because $6.5B/365GWh=$18k/MWh compared to Tesla at about $750k. As Giles indicates, it will only be financiable if the Feds bring in a special source of income based on this dishonest assessment of its capacity.

  3. SA_Jack 3 years ago

    I think that it would be fair to say that many folks on this forum would have originally liked the idea of a Snowy 2.0, at least in principle. What is becoming increasingly clear is that Turnbull sees Snowy 2.0 as his silver energy bullet to appease both the pro- and anti-renewable crowds but he has failed in his judgement of the speed and complexity of the energy transition underway in Australia. It is not simply a move from fossil-fuels to renewables – but in fact a move from centralised to distributed generation – baseload to flexible and manipulable generation. Turnbull’s plan for renewables is based on completely outdated ideas such as massive taxpayer funded centralised energy generation that reinforces existing market power and potentially crowds out private renewable investment.

    • Giles 3 years ago

      well said.

    • Cooma Doug 3 years ago

      If you do a simple calc.
      How much would it cost to install on 500 thousand homes 3days storage (40 kwhs)?

  4. trackdaze 3 years ago

    Early announcements designed to spook investments in other forms of storage and renewables.

    No different to communist esque jawboneing govt undertook with AGL 2022 closure of uneconomic liddell. A new new low.

  5. David McInnes 3 years ago

    How many big batteries such as the Tesla one in SA could you get for $4 billion? I imagine
    quite a few, which could be sited in suitable locations around the country.

    • Alan S 3 years ago

      You’d get quite a few plebiscites for $4B and could sack the elected decision makers.

  6. David McInnes 3 years ago

    How many big batteries such as the Tesla one in SA could you get for $4 billion? I imagine quite a few, which could be sited in suitable locations around the country.

  7. Alan S 3 years ago

    The prediction is a 50% increase in the total power output of this scheme (5 major, 3 minor power stations and 5 large dams taking almost 30 years to build) by adding one underground power station and a 27 km long, 9 m diameter tunnel. Amazing.

    Batteries and small pumped hydro schemes don’t give the same photo opportunities as Tumut 3 do they Malcolm so how about a coat of paint for those pipes? Don’t look like they’ve seen a brush since I worked there 40 years ago.

    • riley222 3 years ago

      Alan, thats pretty much my thought too (the amazing bit, not the coat of paint bit, but you’re right they could do with a spruce up).
      I make no claims to being anything but an interested observer, but while I can see some problems in having a large project like Snowy 2.0, it seems to make economic sense. It’s a start , a solid base in the move toward more renewables in the system. I would fully expect that the pumping would eventually be renewables powered, and that the Snowy scheme would get additional returns by providing firming for renewables, as well as generation.
      I don’t think this will inhibit other storage projects , there is going to be a need for a lot more storage spread throughout the grid.
      I have no doubt it will run over budget, but hopefully not over time.
      I’m extremely pleased its been given the go ahead, despite all the new technologies coming into use this scheme will be a vital part of our replacement for the fossil fuel fleet.
      There is no way to predict the future but I’d be very surprised if this project wasn’t anything other than a very big positive in the move toward more renewables.

    • Joe 3 years ago

      Nation Building…is priceless.

  8. Joe 3 years ago

    Snowy 2.0…why did we just spend $29millions of our hard earned on a feasibility study when Two Tongues Turnbull was down there in his ‘Black Leathers’ early this year saying Snowy 2.0 was a goer to be built. I saw Mark Butler today hold a presser and he raises more questions about the whole thing and asking is Coal to be used to do the pumping? And then there was Paul Broad, the Snowy boss, talking about…Snowy 3.0 in 2030…that should give ‘Pumper Coal’ a bit more life yet. What the hell is going on?

    • riley222 3 years ago

      Joe I suppose coal could be used to do the pumping, but you’d have to lean towards renewables being used on economic grounds.
      Nothing is certain but I think renewables will eventually power Snowy 2.0, coal may be part of the mix initially, but thats no reason not to go ahead with the project. It’ll come down to the politics of the day, and who can predict what that will be, but you’d have to guess that fossil fuels are not about to become a better idea than renewables.

    • Electric Boogaloo 3 years ago

      A couple of things that all the naysayers are overlooking are the transmission constraints preventing the development of the best onshore wind region in the country.

      The Eyre Peninsula on SA’s west coast is said to have gigawatts of wind potential, but currently the transmission system is completely inadequate for exploiting it. The transmission provider in SA is currently in the process of working out how to upgrade the transmission system there, and there is talk of an interconnector into NSW.

      So it’s not unreasonable to imagine that in a decade there could be a transmission network from the Eyre Peninsula across to NSW which will enable the development of gigawatts of wind generation (not to mention solar PV, because the sun sets much later over that way so it could help meet peak demand in the east) that could be sent interstate.

      I would even say that it’s not unreasonable to think that in 20 years time SA could have a 500kV transmission system linked into NSW and VIC’s 500kV systems and so it is capable of exporting many gigawatts of power to the east coast.

      The Snowy 2 scheme is something that should be thought about on a timespan of 25-100 years.

      It will also be able to bridge the gap in wind droughts, which we had earlier in the year where wind output was consistently at 10% or less of capacity for a couple of months. There are also periods of days where wind output across the NEM is consistently very low. Indeed, the last couple of days have been just like that.

  9. bedlambay 3 years ago

    Would you buy gold bars from Turnbull and Fryberg.

    • Joe 3 years ago

      Gold colouring on the outside with …’clean black coal’ on the inside.

  10. Jimbo 3 years ago

    Snowy Two was around for decades and was a Sir Humphrey moment intended to dig Turnbull out of a hole that was his total absence of an energy policy.
    It is of critical importance the line Q “The feasibility study was partially released ”
    Meanwhile the mainstream media is raving about the huge success which is nothing more than Turnbulls dreams.

    • Joe 3 years ago

      Everyone including Two Tongues Turnbull is entitled to odd wet dream

  11. Alan S 3 years ago

    I’d like to see a feasibility study into gravity storage using weighted rail wagons. Easy to build on a local slope or dead mine, easily expandable and no need to add water. Perhaps an article about ARES progress Giles?

    • Gordon 3 years ago

      The thing to remember about using steel instead of water is that you get the same potential energy storage from equal weights of steel and water. Since steel is about 8X the density of water, you only need 1/8 the volume, but it is a hell of a lot more than 8X the cost! Also, we do not have the manufacturing ability to make it in sufficient quantities, even if it was only 8X the cost of water. I can’t see it as being economic to do, particularly as there are tens of thousands of potential sites for pumped hydro storage, using essentially free water.

      • Alan S 3 years ago

        Nobody said anything about using steel as mass. That’s a bizarre idea as though you’re deliberately looking for problems. There’s plenty of sand and rock around – certainly more than ‘free water’ in Australia – the driest continent on earth. That’s the whole point about using solids instead of liquid. It’s easier finding a slope close to a centre of population than two valleys at elevation differences of 200 m. There’s currently a handful of sites under consideration for pumped storage so where are these ‘tens of thousands’?

        • Gordon 3 years ago

          The ANU study identified 22000 potential sites initially, and I believe there are probably others. Tens of thousands? Yes I think so. I’m sure you saw it reported here on these pages.

          Yes there is more dirt than water, but once acquired, the water doesn’t get used up, and I’m sure water availability was a consideration on the site survey. Also, the driest continent is surrounded by vast quantities of water in the wettest ocean on Earth 😉 There are plenty of areas with significant elevation difference near the coast.

          Yes there is plenty of dirt, but what holds it over the rails? Wagons made of steel. (There have been plenty of suggestions of using steel, if not by you here.) Wagons that carry ore are very heavy, for use on essentially flat railway lines. If you want to tip the rail at say 25 or 30 degrees (so that you don’t need ridiculously large areas of land of low slope) for energy storage down a steep hillside, I think the wagons would need to be significantly stronger.
          Dirt is only about twice the density of water, so you’d need ~4X the volume that you would need if using steel (and 1/2 the volume of water). How many rail wagons to carry dirt equal to the weight (or even 1/10th) of water in say Lake Eucumbene? An awful lot of steel.
          On a much smaller scale, (which I realise doesn’t necessarily apply at large scale) I’ve looked at the feasibility of using containers of scrap steel and dirt on rails up my own slope, vs my partially completed pumped hydro system, and it just doesn’t stack up economically or practically, by a huge margin… plus I feel much safer with the water enclosed in a poly tanks and pipe vs 24 tons of steel/dirt/heavy stuff hanging 50 or 100m up the side of the hill above my house!

          • Alan S 3 years ago

            I’d call that deliberately looking for negatives. There are many types of renewable energy and many types of storage methods – no one silver bullet. There are also many opponents who look for every opportunity to knock.

          • Gordon 3 years ago

            Indeed there are many types, I agree. However, the lowest cost per kWh and most practical will generally win out, barring ill-informed government interference of course.

          • Mike Westerman 3 years ago

            Gordon your responses have been sound and reasoned so it does sound more like Alan who is looking for a silver bullet! Electric trains are used for energy storage to great effect on most urban metros, but using kinetic energy to smooth out power demand, rather than potential energy to support grids.

          • Alan S 3 years ago

            I suggested gravity storage as one method that was worth considering in the mix, not a silver bullet. I thought that was fairly obvious Mike. It’s always a good idea to read the full thread before commenting.

          • Mike Westerman 3 years ago

            I read the full thread sure Alan, as I have responded to the train option before. But your reaction seemed to be defensive of well founded and reasoned criticism of it, as tho you felt it was a silver bullet, not to be criticised. I can assure you that engineers such as myself are losing considerable sleep over the issue of storage, and that the hurdles are not lack of sites or lack of technological solutions. The hurdles are entrenched financial advantage and market power and ideology driven politics leading to slow reform.

          • Alan S 3 years ago

            Forget about your perception of my reaction, you’re well off topic. Where in my original post did I suggest it as a silver bullet? Gravity storage is an alternative method, no more, no less. Do you have a problem with that and if so, what is it?

          • Mike Westerman 3 years ago

            The problem pure and simple Alan is anyone can dream up bright ideas and ask for a FS on them. But fortunately engineers have learned to avoid wasting lots of money like that, despite politicians loving to do so, and instead go thru a step by step process. The first step is a concept study, sometimes called a fatal flaw study, which tries to kill the idea by finding hurdles that are impossible or very expensive to mitigate. Then follows a prefeasibility study using just the sort of rough numbers I’ve given you. Then comes the FS if the idea is still standing up at that stage. Solid gravity storage is as old as clocks, so clearly it can get thru a fatal flaw, even allowing for scaling up issues. But the PFS kills it – it clearly is a poorer quality and equally as expensive an idea as batteries, and somewhat poorer and much more expensive than pumped hydro. So there it dies. Move on.

          • Alan S 3 years ago

            ‘Move on’? It was you who decided to join the discussion. You clearly have a bee in your bonnet about this.

          • vielepunkte 3 years ago

            hydro is gravity storage, the most efficient one.

          • Electric Boogaloo 3 years ago

            Forget steel and dirt as ballast and use depleted uranium, as found in passenger jets and racing yachts and which weighs in at about 20 tonnes per cubic metre.

            Railway traction power systems are available at 25kV, which is what the Adelaide suburban rail system is using.

            Although on the other hand, you also need to factor in wear and tear on the tracks and bogies. Tracks have a lifetime measured in tonnes that pass over them and need to be grinded regularly to maintain their shape, as do bogies. Heavy trains also require more expensive track construction.

        • Mike Westerman 3 years ago

          Do the fag packet calcs yourself Alan:

          PHES – say I wanted to build a 100MW scheme on the Highbury Quarry near Adelaide. 150m head so about 1.6GL for 6h storage, a small dam at the quarry, 3m pipelines or tunnels, new pond at the bottom. Both ponds about 500m on a side, so change in level for a cycle about 6.5m. Add a little bit for safety, so the bottom pond is 500x500x10m deep – much smaller than the turkey’s nest dams at Cubby Station. 600MWh stored. Price – about $150M

          Railway – I start near Adelaide city and head for Norton Summit, look for 200m rise. My wagons are 40t each filled with 240t of sand, 280t each. So each will gain about 550MJ in the 200m rise so I need 92 to match the hydro which will be a train 1800m long. If I power each axle, I could face a grade of 1:7 so the track would be 1400m plus the length of the train so 3200m long. At typical costs the railway would cost about $600M. If the cars are about $350k each, and the substation another $15M, then I’m up to $647M. Rail overheads are available up to 15,000V which gives close to 8,000A at startup even with reduced voltage, so I need to use solid copper pick up rails, say 100x100mm bars to keep the losses down, about 600t plus insulators – $10M, so total about $657M – close to the cost of the Big Battery but orders of magnitude slower in responding. In fact so slow I might have to add another 500m of rail to speed up and slow down in – opps, another $100M.

          • Alan S 3 years ago

            My original comment was a suggestion for a feasibility study into gravity storage using solids rather than liquids which seems to have really excited you and Gordon. Do you have a problem with that? We’re talking about a FEASIBILITY STUDY – there it’s in capitals to make it clear what we’re talking about. Read what I’ve written and try to sitck to the point. If you don’t understand then just ask – I’m patient up to a point.

          • JWW 3 years ago

            Maybe you would use only passive railway wagons and have them hooked up to a steel cable that connects to a motor/generator at the top. Similar to a ski lift, just stronger. That would be much cheaper.

          • Mike Westerman 3 years ago

            Yes lots of ideas but what the engineering and economics dictate is pumped hydro using water as the medium

  12. Hettie 3 years ago

    But it won’t be ready until 2027.
    Given Waffles record, that could well mean 2047.
    Likely cost blowout to $4.5 Bio, plus another $2 Bio for poles and wires. Super. $6.5 Billion.
    What did HPS cost? $100 mio??
    How long to commission? 99 days.
    How many of those for $6.5 Bio?

    • Cameron 3 years ago

      $6.5 billion divided by $100 million = 65
      HPR holds 129 MWh of stored energy. So 65 of these would give you 8.3 GWh of storage. Not quite as much as the 365 GWh that Snowy 2.0 would hold.

      Some other comparisons:
      Energy Australia’s Cultana Pumped Storage feasability study1770 MWh and $477 millio = $269/kWh of storage capacity
      Snowy 2.0 feasability study 365000 MWh and $6500 million = $18/kWh of storage capacity
      HPR 129 MWh and $100 million (if that is correct) = $775/kWh of storage capacity

      • Mike Westerman 3 years ago

        Except that Cultana and similar PHES will sell most of their capacity on a daily cycle, and in access comparative schemes, it’s revenue that pays for the financing and generates a ROI. If Snowy 2 does no better than most other PHES, it may sell 1750h of full output per year (about 20% capacity factor). On that basis, its $1,857/MWh/a and if discounted at 8% over 30y that’s the impossible price differential of $246/MWh for a round cycle efficiency of 67%. Several of the projects I’m looking at that haven’t had Turnbull’s helicopter leather jacket blessing come in at around $70.

        But Snowy 2 will make it difficult to get these other incremental projects up by overhanging the market

        • Cameron 3 years ago

          It is a shame that Snowy Hydro have not shared at least a high level overview of their commercial model – they seam to think it will make the returns required. Must have used different assumptions to yours.

      • Alan S 3 years ago

        The Hornsdale battery is intended to deliver in fractions of a second to smooth fast interruptions such as those we had during the storm. You can get a hydro generator doing its job in 20 seconds at best – if it’s already spinning. Entirely different purposes and there’s no point comparing costs.
        A pumped storage facility in NSW would give little benefit to a ground fault 1000 km away.

  13. Ken Dyer 3 years ago

    I have absolutely no doubt that Snowy 2.0 will go nowhere beyond feasibility study stage.

    It was commissioned under the Federal Labor Government in 1948, and vehemently opposed by Menzies, but it got built just the same. Howard tried to sell it in 2006, and in 2014 Abbott established the Commission of Audit (now defunct) that recommended that the Snowy be sold.

    This really just goes to show that the COALition and Turnbull is not serious about Snowy 2.0. It is really using it as a straw man to oppose solar and wind energy projects.

    The Feasibility Report para below promtes more rather than less centralisation of an already centralised command and control energy system:

    ‘The scale and centralised location of the Project provides Snowy Hydro with the ability to undertake the necessary energy and capacity-balancing role that the future energy market increasingly requires. This scale and centralised location enables the system stability, energy reliability and firming capability benefits to be enjoyed by all energy system users.’

    The following paras. have already been shown to be fallacious in view of South Australia’s Tesla battery performance:

    ‘The reliable energy , or dispatchable generation supply, provided by the Project can be provided precisely when the market requires it and has the capability to run for over 7 days continuously or 15days during the peak period, at maximum capacity, before it needs to be ‘recharged’.

    Given the projected multi billion cost of Snowy 2.0 and the estimated delivery time frame, the following para. is simply wrong:

    ‘The Project enables a low-emissions future to be delivered at least-cost, by serving the market with the necessary system stability that enables deeper penetration of currently poorly integrated variable renewable generation, particularly as this penetration increases to meet global agreements.’

    And let us not forget the decades long environmental sagas surrounding river flows and other environmental issues. But i suppose that when you have environment ministers like Hunt and Frydenberg with their appalling records, what can one expect.

    Finally, there are the commercial, business analysis and real cost estimates that have been omitted from the report. The track record of the COALition as with all Liberal governments in Australia point to development by a PPP arrangement where all the profits goes to private companies and the taxpayer ends up footing the bill.

    There is no way this turkey should fly.

  14. Robert Westinghouse 3 years ago

    Reading the science: we need more regional power not BIG centralised. All centralised power will do is increase costs on distribution, increase profits to BIG Power, increase costs to consumers and inflate Trumbil’s ego. As Gran says: Malcom is a show pony and not even a good looking one

  15. Jon 3 years ago

    I think it still has a place.
    The interconnectors need upgrading to let the NEM function better, it’s not unusual to see the interstate lines running at capacity.
    It won’t be doing the same job as the HPR or other chemical batteries, it will be time shifting large amounts of kWhs of power over day/week periods and enable large volumes of renewable energy projects to go ahead with less restriction.
    Some large pumped hydro batteries around the grid will help take the grid from a synchronous system of generation needing to a more non synchronous network with generation on a sunny day happily running people’s evening loads.

    The government wanted to give $1B of our money to build a railway line for Adani, this has to be worth 6 times that!!

    Build it and the renewables will put the coal burners out of business quicker.

  16. John Saint-Smith 3 years ago

    I thought we were trying to design and build a clean, reliable and cheap replacement for our aging, unreliable, inflexible carbon intensive East Australian Electricity Grid. One that will power our entire economy for the next 50-100 years. We have the potential to supply S.E. Asia with TWs of electricity and or hydrogen gas, and other materials made using our abundant cheap energy.

    Surely what we need first is a huge nation building plan developed by a team with a vision for and an understanding of the future, who aren’t hamstrung by 19th Century regulations designed by the fossil fuel industry and the IPA.

    PHES would undoubtedly be a significant part of that plan, but surely any notion of building Snowy 2 should be predicated on how it fits into an integrated solar, solar thermal, on and off-shore wind and biogas generation network stretching from Arnhem Land to Eyre Peninsular and Tasmania and all points in between. It may make more sense to place the storage near the ultimate point of future energy use.

    Given Turnbull’s record for going off half-cocked, and cocking stuff up, I don’t trust him to lead us into the future, especially while he spends most of his time looking over his shoulder trying to cover his own arse.

    He has a conflict of interest that Australia cannot afford to indulge.

  17. Radbug 3 years ago

    So this is Malcolm Turnbull’s pet project. Liberals aren’t supposed to have pet projects. Liberals are supposed to vehemently reject the political allocation of capital, otherwise known as Socialism. Without a firm ideological core, the Liberals lack policy consistency, leading to policy failure and defeat, as we saw in the recent state election in Queensland, where Tim Nichols was wiped out in Brisbane (and will lose Clayfield next time) because he couldn’t decide whether to support or reject the NAIF loan to Adani. Snowy 2.0 is shaping up as another HELE power plant story, dependent on government funding to remain viable. The next step is to file FOI requests for the redacted chapters. Giles, weeks ago I pointed out that the bits Malcolm didn’t like would be redacted! The guy is SO predictable!

  18. Stephen Gloor 3 years ago

    As an anonymous commentator said when it was first proposed
    “Snowy 2.0 makes so much sense for Australia which has so little sun and wind and so much water …….”

    Nothing has changed since then.

    • George Darroch 3 years ago

      There are parts of the south that are wet and dark in winter. That’s why there’s Snowy Hydro there in the first place.

  19. The Duke 3 years ago

    Snowy Hydro 2.0 should now be christened Snowy Hydro 4.5 or even Snowy Blowy.!
    Or Turnbull 30 and counting.!

  20. itdoesntaddup 3 years ago

    You would not build this project for a coal fired grid (just pile the coal high in the stockyard). You would need a large number of similar projects for an all renewables grid in order to provide adequate backup for a run of poor weather for renewables generation. Perhaps the real purpose of the gambit is to draw out the debate on what that really costs.

    • Mike Westerman 3 years ago

      Very expensive way to prove a point. I think it’s simply ego driven fantasy. Following a disastrous term as PM including the legacy of the NBN Turnbull is looking for his signature project.

  21. Chris 3 years ago

    Hey Giles, since youre completely for a decentralised grid, constantly mention how solar and batteries are now cheaper than the grid etc, tell me more about your own power system at home? like capacity and costs etc.
    I mean it would be foolish of you to still be connected to the grid right??

    • Mike Westerman 3 years ago

      Hey Chris in case you’re confused, distributed generation and storage on a decentralised grid does not mean a) that you disconnect (in fact to do so negates the benefits of geographical diversity) or that b) everyone has all elements or attempts self sufficiency (in fact the opposite as per above). Just as the Internet and pc’s have proven more robust than mainframes so DES and DG will do the same for energy.

  22. TheTransition 3 years ago

    I see no reason for the snide comments Giles. By the times it’s built many parts of Australia have ambitions to exceed 50% renewables. VIctoria, SA, Queensland at the moment. Going forward it it will help support the 100% renewable scenario favoured by many on this site. It will be operating well past 2050 when we’re meant to be 100% clean energy and supporting a vastly larger electric transport sector as well.

    • Mike Westerman 3 years ago

      There is nothing intrinsically “good” about PHES – it is a net energy consumer so it’s virtue arises from being an enabler of RE. Snowy 2, being part of the ill-directed and conceived initiatives of the current government is most unlikely to deliver anything positive rather, it will further concentrate market distortions, ignores the value of the Kosciuszko NP, and does nothing to prioritise real solutions.

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