News

SNOWY 2.0 MAIN WORKS TO DRIVE JOBS AND INVESTMENT

28/08/2020

Snowy 2.0 today achieved another significant milestone with the Federal Government’s approval for the project’s main works construction.

The Snowy 2.0 pumped-hydro project is a major expansion of the Snowy Scheme, linking two existing dams, Tantangara and Talbingo, through 27km of tunnels and building an underground power station.

The approval today allows construction to commence on the underground power station, waterways and access tunnels, and other supporting infrastructure.

It follows on from exploratory works, which got underway in 2019 and has included constructing site access roads, establishing a construction compound and excavating an exploratory tunnel.

“This approval marks the next stage in Snowy 2.0’s construction and brings our vision to become Australia’s biggest battery and storage for renewable energy one step closer,” Snowy Hydro’s CEO Paul Broad said.

“It’s full steam ahead for the Snowy 2.0 project that will pave the way for Australia’s energy transition.

“It also unlocks billions of dollars of investment that will create thousands of jobs over the life of the project and provide a much-needed boost to the local and regional economy, which has been hit by drought, bushfires and COVID-19.

“Snowy 2.0 is already playing a major part in kick-starting the local economy, with more than 100 local businesses involved and more than $35 million spent in the Snowy Mountains region.

“On completion of the project in 2026, it will provide 2,000 megawatts of new peaking power and firming capacity that will provide clean and reliable energy to millions of Australians.”

News

Australian Govt green lights Snowy 2.0 Main Works

15/07/2020

The Australian Government has given environmental approval for Snowy 2.0’s Main Works, which will create up to 4,000 jobs, drive significant infrastructure investment and underpin Australia’s renewable energy future.

The approvals include almost $100 million in offsets, which will be invested in conservation and recreational projects in Kosciuszko National Park that will benefit the local environment and park users.
Snowy Hydro’s CEO Paul Broad said the Federal Government’s approval on 30 June 2020 now finally cleared Snowy 2.0 to go ahead.

“This is the final approval for Main Works including the tunnelling after a comprehensive and robust assessment process,” Mr Broad said.

“This is a very exciting day for Snowy Hydro and marks a major achievement in our vision to become Australia’s biggest battery and storage for renewable energy.

“Snowy 2.0 will provide 2,000mw of new peaking power and firming capacity that will provide clean and reliable energy to millions of Australians.

“We’re now moving full steam ahead with this vitally important project for Australia’s future.

“Snowy 2.0 is already playing a major part in kick-starting the local economy, with more than 100 local businesses involved and $35 million spent in the Snowy Mountains region.

“To date, more than 500 people are working on the project as we progress the Exploratory Works that have been approved and underway for more than 12 months,” Mr Broad said.

There has been significant project activity at the Lobs Hole work site, with access roads and permanent bridges built, an initial construction camp established and excavations at the main access tunnel portal, in preparation for the first tunnel boring machine, which is expected to arrive in the coming months.

The Main Works will see construction continue to ramp up and will include an underground pumped-hydro power station, a range of tunnels, chambers and shafts, and roads, power and communications infrastructure.

“For a small permanent and mostly temporary construction footprint covering just 0.1% of the park, Snowy 2.0 will deliver 2,000MW of clean energy and large-scale energy storage to support many other wind and solar projects coming online,” Mr Broad said.

“We have been operating in Kosciuszko National Park for more than 70 years and we are committed to seeing it left in better shape for future generations.

“Snowy 2.0 will continue to be a major economic boost for local and regional communities dealing with the double impact of bushfires and COVID-19, with the workforce predicted to total 4,000 over the life of the project.”

News

Statement from CEO Paul Broad on COVID-19 case

30/03/2020

As a provider of essential services we are well prepared to operate through COVID-19. For weeks now we’ve had extensive measures in place to keep the lights on and progress Snowy 2.0 as safely and responsibly as possible.

On Thursday last week we were notified of a positive COVID-19 test result involving a Snowy Hydro employee who went immediately into self-isolation after returning from an overseas holiday.

As per Snowy’s strict and proactive COVID-19 protocols, the individual went into self-isolation immediately upon returning to Australia and did not come into contact with anyone. The employee was later tested following the development of a mild cough.

NSW Health Department has concluded that the employee has not transmitted the virus to any other person. In this case, the risk measures implemented by Snowy Hydro weeks ago were very effective and the staff member will remain in isolation until he is medically cleared.

Snowy Hydro continues to strictly enforce all of its COVID-19 safety and risk measures. We are operating at full capacity, Snowy 2.0 is full steam ahead and we continue to invest locally, supporting jobs and working with local businesses and suppliers.

News

Local and global experts to build Snowy 2.0

05/04/2019

Today Snowy Hydro Limited has achieved another significant milestone for Snowy 2.0 by appointing Future Generation Joint Venture as its main contractor. Snowy 2.0, a world-leading pumped-hydro expansion project, together with the mighty Snowy Scheme, will underpin Australia’s transition to a renewable energy future.

Future Generation is a joint venture between Clough, an Australian construction and engineering company, Salini Impregilo, a global hydropower and tunnelling specialist, and Lane.

The Engineer, Procure and Construct (EPC) contract signed today with Future Generation is consistent with the terms set out in the extensive, publicly-released Final Investment Decision information pack.

Under the single wrapped EPC contract, Future Generation will lead the civil works and Voith Hydro will deliver the latest hydro-generation technology in the new underground power station.

News

Keeping the lights on for generations to come

26/02/2019

At Snowy, we have a proud history and a strong vision. Snowy Hydro, supercharged by Snowy 2.0, will underpin Australia’s renewable energy future and keep the lights on for generations to come.

Almost 70 years after the first sod was turned on the mighty Snowy Scheme, we will do it all again. Today, after consideration of our Board’s Final Investment Decision, we welcome Shareholder approval of Snowy 2.0.

“It’s an exciting time for our Company,” Snowy Hydro CEO Paul Broad said. “Snowy 2.0, like the original Snowy Scheme, is a nation building project that is vital to Australia’s economy and our energy transition.

“This significant expansion of the Snowy Scheme will provide the storage and on-demand generation needed to balance the growth of wind and solar power and the retirement of Australia’s ageing fleet of thermal power stations. In short, it will keep our energy system secure.

“Snowy 2.0 is not only a sound business investment for Snowy Hydro with over 8% return on investment. It also represents the most cost-effective way to ensure a reliable, clean power system for the future.

“When it is completed, Snowy 2.0 will be able to deliver 2000MW of on-demand generation, up to 175 hours of storage, and deliver more competition that will keep downward pressure on prices.

“We are committed to continuing to grow our portfolio of assets, to maximise competition in the National Electricity Market (NEM) and deliver more value to consumers,” Mr Broad said.

Last year Snowy Hydro contracted 888 megawatts (MW) of wind and solar projects which gave us incredible insights into energy pricing. This process confirmed many of the assumptions of Snowy 2.0’s business case, including that the National Electricity Market (NEM) has passed a tipping point. New renewables are now the most economic form of new generation, even when firmed by hydro or gas.

Snowy Hydro existing fast-start assets, and increased capacity with Snowy 2.0, will firm up large amounts of intermittent renewables by coming in and out of the system to ‘fill the gaps’ by generating energy at times of peak demand.

Snowy Hydro has a strong track record when it comes to pumped-hydro. For decades we’ve been successfully operating our pumping capability at Tumut 3 and that has been invaluable, especially in years of drought.

Snowy Hydro is the fourth-largest energy player in the NEM, providing much-needed competition in the market. Snowy 2.0, along with other developments, is adding to a portfolio that operates efficiently and reliably in a highly unpredictable NEM to maximise competition and drive the best outcomes for consumers.

Snowy 2.0 Exploratory Works will start immediately. The project is expected to generate up to 5000 jobs over the life of the project.

News

Snowy Hydro welcomes planning approval for Snowy 2.0 Exploratory Works

11/02/2019

Snowy Hydro welcomes the New South Wales Government’s planning approval for Snowy 2.0 Exploratory Works today. The decision, which follows a rigorous environmental and planning assessment process, is another significant milestone in progressing the project.

Snowy Hydro hopes to commence work for Snowy 2.0 soon, subject to Shareholder approval from the Federal Government.

Snowy Hydro CEO Paul Broad said NSW Government’s support for Snowy 2.0 is critical for the security, affordability and reliability of the National Electricity Market (NEM) in the future.

“The mighty Snowy Scheme keeps the lights on across the National Electricity Market at times of peak demand today, and Snowy 2.0 will build on our existing capabilities.

“With more intermittent renewables coming online Snowy 2.0 will create an additional 2000 megawatts of on-demand energy generation and 175 hours of large-scale storage so households and businesses have energy when they need it most.

“Snowy 2.0 will deliver reliable energy at times of peak demand and can ‘fill the gaps’ by generating when wind and solar energy output is low.

“Snowy Hydro takes its environmental responsibilities very seriously. We have a long and proven record of responsibly operating the Snowy Scheme within the national park and we will do everything possible to avoid or minimise impacts from construction of Snowy 2.0.

“Snowy Hydro will provide $10.5 million to offset any impacts from the Exploratory Works,” he said.

The NSW Government, which is responsible for allocating the offsets, has made the commitment that Snowy 2.0 offsets will be used by National Parks and Wildlife Service to support local environmental and recreational initiatives in Kosciuszko National Park.

Exploratory Works involve excavating an exploratory tunnel to gain a greater understanding of the underground geological conditions at the proposed location of the new Snowy 2.0 power station. The works also include upgrades and establishment of access roads, establishment of a construction compound and supporting infrastructure, and other activities.

Almost 50 years ago, exploratory tunnels were constructed for both Tumut 1 and Tumut 2 power stations, the two underground stations in the Snowy Scheme.

Snowy 2.0 will create jobs and economic opportunities across the Snowy Mountains – already more than 50 local businesses have been involved in the project.

In March 2018, Snowy 2.0 was declared NSW Critical State Significant Infrastructure, which provided a clear and well established framework for the project’s planning and environmental approval requirements.

An Environmental Impact Statement for Snowy 2.0 Main Works will be submitted to the NSW Government later this year.

For more information about Snowy 2.0, please visit snowyhydro.com.au.

News

Snowy Hydro appoints preferred tenderers for Snowy 2.0

18/01/2019

Snowy Hydro has appointed Australian and global experts in construction, engineering and hydropower as preferred tenderers for the Snowy 2.0 project, following extensive competitive tender processes over the last 18 months.

The preferred tenderer for the civil works is Future Generation, a partnership between Australian construction and engineering company, Clough, and global hydropower and tunnelling specialists, Salini Impregilo.

World leader in hydropower engineering and equipment supply, Voith Hydro is the preferred electrical and mechanical tenderer and will deliver the latest hydro-generation technology in the new power station.

Australian company Leed Engineering has also been awarded the contract for exploratory works pre-construction activities.

Contracts are currently being finalised, with contract execution subject to Shareholder approval of the project.

This is another important step towards the commencement of the project. Snowy 2.0 is a world-leading pumped-hydro project that, with the existing Snowy Scheme, will underpin the stability of the energy market as more renewable energy enters the system.

News

Snowy 2.0 approved by the Board

12/12/2018

Today, the independent Board of Snowy Hydro Limited approved a final investment decision to proceed with Snowy 2.0, subject to Shareholder approval.

Snowy 2.0 is a pumped-hydro expansion of the existing Snowy Scheme, providing 2000 megawatts (MW) of on-demand generation and 350,000MW hours of large-scale energy storage.

After almost two years of rigorous due diligence on every aspect of the Project, including detailed financial analysis and ongoing geotechnical drilling, the Board is confident Snowy 2.0 is a strong investment for the Company.

The Board has informed the Shareholder of its decision to proceed with Snowy 2.0 subject to Shareholder approval. Further Project information will be released following Shareholder approval.

Find out more about Snowy 2.0 here.

News

Snowy Hydro signs game-changing deals

01/11/2018

Snowy Hydro announced the signing of eight wind and solar contracts today to provide cheaper energy to 500,000 households.

The eight projects, totalling 888 megawatts (MW), are located across New South Wales and Victoria and are expected to generate about 2.8 terawatt hours of energy annually.

The new renewable energy generation, ‘firmed’ by existing Snowy Hydro assets, is a game-changer and will push down future energy prices. This will bring on significant new energy supply and therefore much-needed competition to the market, and will enable Snowy Hydro to pass on lower wholesale prices to our customers.

The renewable energy we have contracted will enable Snowy Hydro to offer very competitive, firm wholesale prices (ie. the cost of the raw renewable energy plus the cost of ‘firming’) – for below $70/MWh for a flat load, for up to 15 years.

Snowy Hydro is a key provider of fast-start, “capacity”-type products, and we keep the lights on at times of high demand. However, we are ‘energy short’ (meaning that we do not generate enough energy from own power stations to cover all of our customers) so we have to purchase energy from the wholesale market. We are one of the largest energy buyers in the NEM and, just like households, we are exposed to high wholesale prices.

Over the last 12 months, there have been rapid changes in the NEM and competitive pricing across all generation technologies has seen the cost of renewables fall.

Snowy Hydro was overwhelmed with the level of interest in our Renewable Energy Procurement Program, which saw more than 17,600MW of projects submitted through the procurement process. All eight winning projects are expected to come online within the next two years.

Snowy Hydro’s existing hydro, gas and diesel assets give us the ability to ‘firm’ up vast amounts of intermittent renewable generation today to ensure energy is available when needed.

In simple terms, ‘firming’ works by transforming intermittent energy into reliable energy so it’s available on-demand when a customer needs it. While the energy output of individual projects varies, Snowy Hydro’s power stations can work in combination with wind and solar, creating ‘firm’ reliable energy.

Snowy Hydro owns Red Energy and Lumo Energy, which together have more than one million customers.

News

Sharing Snowy Stories

19/03/2018

As Snowy Hydro embarks on an expansion of the Snowy Scheme a unique digital storybook project is underway to capture the voices and experiences of ten former workers.

Snowy Hydro and Woden Community Service have partnered on the project which sees former workers who are all in their 80s and 90s share their stories of determination, success and resilience with current and future generations.

Paul Broad, Snowy Hydro’s Chief Executive Officer, said that former Snowy Scheme workers overcame significant engineering and construction challenges to build one of the greatest and most complex hydro power systems in the world.

“It took ingenuity, dedication and hard work to build the Snowy Scheme. Our former workers are a critical part of our company’s history and strength, and capturing their stories is very important.

“We often reflect on and marvel at the achievements of the original Snowy pioneers. Today, as we’re designing and planning the Snowy 2.0 project we’re grateful to have the expert records and technical data from the workers who came before us”, Mr Broad said.

Woden Community Service in collaboration with PhotoAccess and Gen S Stories have the privilege of working with the former workers and bringing their stories to life.

Chris Redmond, CEO of Woden Community Service, said the idea for this project grew from a senior’s social group for ex-Snowy workers, set up by Woden Community Service in August 2016.

“The group is led by Sandy Van Der Toorn, our Seniors Social Group Coordinator. Sandy’s father worked on the Snowy Scheme and she has many fond memories of growing up there.

“We’re also very lucky to have the expertise of Jenni Savigny from Gen S Stories on this project. She enables people of all ages to use the medium of digital storytelling to share their story and assists them to tell it in their own voice (literally). We look forward to working with Snowy Hydro to make this project a success”, Mr Redmond said.

Snowy Hydro has provided $25,000 to fund the project which is due to be complete in the middle of this year. A formal premiere of the stories will be held in June 2018.

News

Snowy 2.0 Declared Critical State Significant Infrastructure

09/03/2018

Snowy Hydro welcomes the New South Wales Government’s decision to declare Snowy 2.0 as a Critical State Significant Infrastructure (CSSI) project.

The declaration signifies the critical role that the Snowy 2.0 project, together with the upgrades to the NSW transmission network, will play in providing reliable energy and large-scale storage to NSW as we transition to a low emissions economy.

Snowy 2.0’s generation and large-scale storage capabilities, along with the existing Snowy Scheme, will continue to underpin the stability and reliability of the NEM as more intermittent renewables enter the market.

The CSSI declaration is not final approval for the project. It is a framework that sets out the robust environmental assessment and approval process that is required for the Snowy 2.0 project.

Paul Broad, CEO of Snowy Hydro said that the CSSI declaration gives the company a very clear and transparent process to follow.

“Like any other project, we are preparing comprehensive Environmental Impact Statements which will include a range of scientific and technical studies to be carefully scrutinised by the NSW Government.

“We have the greatest respect for the Kosciuszko National Park. It’s our backyard and for almost 70 years we have been excellent responsible environment managers operating the existing Scheme across the region.

“The project’s design is being done in a way that minimises its environmental footprint. This includes putting the majority of the physical structures, such as tunnels and the powerstation deep underground”, Mr Broad said.

The EIS will detail the components of the project, the potential environmental, social and economic impacts of Snowy 2.0 and how to best manage them. As part of the EIS, we will undertake thorough community consultation so that the wider community can have input into the process. The EIS will also be published for public comment.

Under the CSSI process and in accordance with the NSW Environmental Planning and Assessment Act 1979, Snowy Hydro will submit an EIS for assessment by the Department of Planning and Environment, in consultation with other key agencies such as the National Parks and Wildlife Service and the Environment Protection Agency.

News

Good business makes good business: The Case for Snowy 2.0

10/01/2018

The National Electricity Market (NEM) has long been an outstanding example of Australia’s microeconomic reform. It brought much needed competition to an industry once dominated by inefficient, state-run enterprises.

Snowy Hydro has been at the heart of this market, with volatility being the key driver of value for our business.

Our unique portfolio of fast start generation assets and large storages allows us to generate at times of peak demand, provide cap contracts insuring retailers against price volatility, and “time-shift” surplus, low price energy to high price/demand periods. We also underpin system security through synchronous generation and strong inertia capability.

Snowy 2.0 is an expansion of what we already do. It is not new or unique. The concept of expanding our pumped storage capability has been around since the 1960s. The growth of baseload power negated its viability, but the economics are changing rapidly.

As intermittent renewables grow, the market will experience greater volatility and uncertainty. The Australian Energy Market Operator confirms this trend as we move to a lower emissions future.

Snowy Hydro has witnessed this first hand, with increased demand for cap contracts in recent times. As it’s often said, when the wind doesn’t blow or sun doesn’t shine, how you fill the gaps forms the cornerstone of a secure, reliable and affordable NEM. In fact, filling in gaps has always been a key role of Snowy Hydro. As renewables increase, the need for our services will increase exponentially.

All independent analyses show that large scale storage is paramount to a lower emissions future. Snowy 2.0 will deliver 350,000MWh of storage to consumers at lowest cost. In fact, the project’s economics blow the alternatives out of the water. If Snowy 2.0 wasn’t built, the alternative would be a combination of batteries and open-cycle gas plants, costing at least twice as much and resulting in higher prices for consumers.

Some commentators have mistakenly sought to model Snowy 2.0 on today’s NEM, rather than the NEM we see coming. The future NEM, dominated by renewables, will require significant flexible peaking generation and storage. Snowy 2.0 will come online from 2024 at precisely the right time to fill the gaps and stabilise the market.

Snowy Hydro is already the leading provider of cap contracts. Increased market volatility, together with Snowy 2.0’s unrivalled storage capability, will allow us to expand our product offerings. These include insurance ‘floors’ and ‘collars’ (providing price certainty for wind and solar) and seasonal ‘energy exchange’ products. This will enhance long term energy security.

Snowy Hydro’s ability to provide ancillary services, critical for system security, will also increase to meet the demands of the future NEM.

As for claims that the economics don’t stack up – I refute them categorically. Snowy 2.0 can be funded off our balance sheet, while delivering a healthy internal rate of return of 8%.

While historically we have not often used our pumping capability, we’re progressively pumping more and will be at capacity when Snowy 2.0 comes online. In fact, our analysis shows that future storage demand will surpass Snowy 2.0’s capacity from 2031, when we can again deliver by expanding the Scheme using the same reservoirs as Snowy 2.0, to benefit future generations.

The scale, complexity and challenging geology of Snowy 2.0 requires a significant investment. Like any major infrastructure project, it is not without risk. To mitigate these risks, we have handpicked a team of world experts as partners on the feasibility study and beyond as we finalise the project’s precise technical requirements.

Finally, to suggest Snowy Hydro isn’t paying for transmission is misleading. The capital costs for Snowy 2.0 provide for the cost of the project’s transmission connection, that is, the lines connecting our assets to the wider shared network. The shared transmission network is common infrastructure used by all generators, with Snowy Hydro being only one and in fact the most infrequent user today, given we only generate at peak times.

The transmission network was built decades ago around coal, and the ideal zones for renewables are not in the same locations. The shared network needs a major upgrade to cater for renewables growth as new projects – again one of which is Snowy 2.0 – come online. The suggestion that Snowy Hydro pay for the entirety of these upgrades is misplaced.

At Snowy Hydro, our financial track record speaks for itself. We conduct rigorous forensic analysis of all investment opportunities and apply stringent hurdles to ensure the best outcomes for our shareholders. Our independent Board exercises the highest levels of scrutiny in assessing investment decisions.

Our feasibility study demonstrated the sound economics of Snowy 2.0. As we move towards a final investment decision late this year, our discipline will not waver. Our shareholders, and the energy industry, would expect nothing less.