Greens try to head off Snowy Hydro gas plant with fossil fuel ban

The Australian Greens have introduced legislation that would prohibit the federal government owned Snowy Hydro from investing in new fossil fuelled power stations, seeking to head off a looming decision by the Morrison government that would see a new government owned gas generator constructed in Kurri Kurri.

The Morrison government has said that it intends to build a gas fired power station built in the Hunter Region if insufficient new generation capacity is built to replace the Liddell power station, and is likely to use Snowy Hydro, which is 100 per cent owned by the federal government, to make the investment.

Snowy Hydro has progressed plans for a 750MW gas generator at Kurri Kurri, with planning approvals currently being fast-tracked by the NSW government, but the Morrison government has faced questions over the genuine need for the power station as it is unlikely to be needed to maintain reliable electricity supplies, leading to speculation that the real motivation behind the Morrison government’s push to build the new power station is to prop up demand for gas.

The Morrison government has indicated that it wants to make a decision about the Kurri Kurri gas plant by the end of April, asking the private sector to step up and commit to building generators to fill any gap left by the Liddell power station. However, many senior energy market figures have argued the Morrison government’s threats to intervene in the market have only worsened investor uncertainty.

The Australian Greens have opposed the plan to see the federal government directly invest in a new fossil-fuelled power station, arguing it would only work to undermine efforts to reduce greenhouse emissions in Australia’s electricity sector.

Australian Greens leader, Adam Bandt, introduced proposed legislation to Parliament on Monday that would prohibit Snowy Hydro from making any new investments in fossil fuel projects, arguing that public funds should not be used to further prop up the gas industry.

“Angus Taylor wants to use Snowy Hydro to implement his pro-gas agenda, turning an Australian icon into a polluter and saddling it with a giant white elephant,” Bandt said. “Public money should not be used to make the climate crisis worse.”

“Angus Taylor has invented figures to back up his Snowy Hydro threat, imposing a completely arbitrary 1000 MW target when the Liddell Taskforce Report made no such recommendation, the AEMO study for that Report identified a system need for only 215 MW by 2025 and AEMO has since reduced that gap to 154 MW.”

Bandt pointed to the recent flurry of announcements of big battery commitments in New South Wales, including a 700MW plan by Origin Energy to build a battery at the site of the Eraring power station, Neoen’s plan to build a 500MW battery at the former Wallerawang power station site, and the CEP’s plan to build a massive 1,200MW big battery in Kurri Kurri itself, which may render any plan for Snowy to build a new gas generator as obsolete.

“Despite all the proposed new investment in NSW, the Minister is still keeping his threat alive, so we must take direct legislative action to prevent the Minister and Snowy Hydro from proceeding with a new gas-fired power station. The IPCC and the IEA have both been clear that there is no more space for new fossil fuel infrastructure if we hope to meet the temperature goals of the Paris Agreement,” Bandt added.

The proposed legislation, which will be seconded by federal independent MP Zali Steggall, would also effectively prohibit Snowy Hydro from acquiring any new fossil-fuelled assets that would add to its existing portfolio.

Snowy Hydro operates the substantial Snowy Hydroelectric Scheme and is currently constructing the Snowy 2.0 expansion, but also operates a portfolio of 1,290MW of gas and diesel generators, including the Laverton North power station, the Valley power station and the Colongra power station, all of which are fuelled by gas.

As a government owned corporation, the establishment and management of Snowy Hydro corporation are guided by legislation, the Snowy Hydro Corporatisation Act, which the Australian Greens are seeking to amend. The proposed amendments would not require Snowy Hydro to offload the fossil-fuelled generators it already owns.