Serious questions have been raised over the claimed environmental and economic benefits of the Snowy 2.0 project, as a leading environmental group calls for the multi-billion dollar government-funded project to undergo an independent assessment before further work is undertaken.
The National Parks Association of NSW (NPA NSW) has released a new assessment of Snowy 2.0, concluding that many of the claims used to justify the expansion of the Snowy Hydro scheme are flawed and that the benefits of the scheme have been overstated or misrepresented.
The Snowy 2.0 expansion was the pet project of former Prime Minister Malcolm Turnbull and has been enthusiastically embraced by energy minister Angus Taylor, and proposes to build 2,000MW of pumped hydro capacity with up to 175 hours of energy storage.
However, while the federal government claims that the project is necessary to meet the growing need for energy storage capacity within the National Electricity Market, the NSW NPA has said its assessment of the project shows that it is the “worst possible project in the worst possible location”.
In a new report, the NPA questions the merits of the Snowy 2.0 project across ten areas, including claims that the project would lead to lower wholesale electricity prices in the long term, that the project could deliver the amount of backup power claimed. It also argues that the round-trip energy losses from Snowy 2.0 will be substantial.
The association has previously noted that the cost of the project has already more than doubled from the initial $2 billion estimate, and argued that the benefits of the project would not justify the disruption it would cause to the Kosciuszko National Park.
“The National Parks Association of NSW recently learnt that the environmental impacts of Snowy 2.0 were more significant than we could have imagined,” an NPA NSW spokesperson told RenewEconomy.
“This project is environmental vandalism that will substantially and permanently damage Kosciusko National Park, one of Australia’s most iconic and unique natural places.”
The federal government has pushed ahead with the project, despite new estimates that the cost of the project would now exceed $5 billion before additional investment in necessary transmission network upgrades are included.
Questioning the claimed benefits of the project, NPA NSW pointed to the fact the Snowy Hydro scheme is located far from major population centres, sitting between Sydney and Melbourne, as well as being a significant distance from ideal wind and solar resources, meaning that its output will need to be sent a significant distance via the transmission network to supply areas of high demand.
“Snowy 2.0 is actually in the worst possible location, requiring major transmission upgrades, incurring far greater network losses than other storage and is vulnerable to transmission outages and constraints, as evidenced during the recent bushfires. The best location for storage is at a load centre, not 500 kilometres away” NPA executive officer Gary Dunnett said.
The NPA NSW compared this to distributed energy resources with on-site storage that can achieve round-trip losses of as little as 9 per cent, and battery storage systems co-located at large-scale wind and solar projects that can achieve losses of below 20 per cent.
According to the NPA NSW, when electricity lost via the transmission of electricity and the pumping-generation processes within the project itself, that as much as 40 per cent of the electricity stored by Snowy 2.0 could be lost in the round-trip process. As a result, the Snowy 2.0 project will be a net consumer of electricity and will lead to higher wholesale electricity prices, according to AEMO analysis cited by the NPA NSW.
A previous analysis published by the NPA NSW questioned the ability of the Snowy 2.0 project to deliver the full amount of energy storage claimed, pointing to the fact the “lower” Talbingo reservoir cannot hold the full amount of water that can be stored in the “upper” Tantangara reservoir.
Snowy Hydro has previously rejected the findings of the NPA NSW analysis.
“We note that the National Parks Association report is not an independent analysis, but just a set of random and unfounded assertions which ignore the true facts about this project,” Snowy Hydro said in a statement.
“We strongly reject any argument that Snowy 2.0 is not in the national interest. It has demonstrable economic and consumer benefits that have been independently valued at $4.4 to $6.8 billion.”
Snowy Hydro also asserted that it was incorrect to consider the additional transmission network costs as part of the total cost of the Snowy 2.0 scheme, as they would be “shared” by the wider energy system.
“It is a falsehood to suggest transmission costs are an added cost to the Snowy 2.0 project as these are shared services used by the power industry, with the new upgraded capacity being essential in managing summer peak demand and transporting wind and solar to market,” Snowy Hydro said.
NPA NSW has argued that the resources being channelled into the Snowy 2.0 project would be better directed towards the construction of additional wind and solar supplies, and their integration with modern energy storage technologies.
“There are many viable alternatives for energy storage, including other pumped hydro sites, batteries, demand response etc – but Snowy 2.0 is the most environmentally destructive, polluting, inefficient and expensive,” Dennett said.
“And Snowy 2.0 runs counter to the trend away from large power stations towards a decentralised National Electricity Market of multiple generation sources and storages, particularly at consumer premises.”
“It would be tragic if Snowy 2.0 was constructed on the premise of claims that were never tested and later proven to be false. At stake are billions of taxpayers money, tens of millions of tonnes of greenhouse gas emissions and thousands of hectares of Kosciuszko National Park” Dunnett added.
The NPA NSW has called for the federal government, which owns the Snowy Hydro scheme, to initiate an independent review of the economic and environmental impacts of the Snowy 2.0 project.
In its report, the NPA NSW details how alternative energy storage projects, that could deliver better performance at a lower cost and avoid damaging a high profile National Park have been overlooked, including a substantial number of potential storage sites identified by an ANU study.
“A recent study identified over 8,000 potential pumped hydro sites in NSW alone, surely these need to be considered before sacrificing our conservation areas to a mega development,” the NPA NSW spokesperson said.
Environment impact statements for the Snowy 2.0 are currently being reviewed by the NSW Department of Planning, Industry and Environment.
