NSW approves Snowy Hydro expansion in threat to gas

New South Wales (NSW) has approved a 2,000MW expansion of its 4,100MW Snowy hydropower scheme, in a move that could pressure demand for electricity from gas-fired plants.

The project still requires approval from Australia's federal government. The hydropower plant, known as Snowy 2.0, is a key part of the Integrated System Plan blueprint to reduce the emissions intensity of Australia's power network as part of efforts to lower greenhouse gas emissions under the 2015 Paris climate agreement.

The Snowy 2.0 project could put pressure on gas-fired plants, which have increasingly provided firming power in eastern Australia's National Electricity Market (NEM) to back up renewable energy. Around 67pc of electricity in the NEM was generated from coal-fired plants over the past 12 months, while renewables provided 25pc and the remaining 8pc came from gas.

Snowy 2.0 involves the construction of a pumped-hydropower station that will be about 800m underground and around 240m long. The project will add 350GWh of energy storage and 2,000 MW of generation capacity and play a major role in the NEM by facilitating the development of renewable energy, NSW's deputy premier John Barilaro said.

A new transmission link between NSW and Victoria state is proposed to take power from Snowy 2.0 into other parts of the NEM.

Australia's electricity system accounts for around a third of the country's GHG emissions.

By Kevin Morrison