Digging Yet Another Green Money Pit

The one thing that can be said for the so-called “battery of the nation” is that at least it doesn’t burst into unstoppable flames, like the other ones. Otherwise, though, the Snowy 2.0 pumped hydro project is just another green elephant. The buggers are breeding like rabbits, sustained by a steady diet of taxpayer’s money.

The estimated cost of Snowy 2.0 recently was reset to $12bn, double the previous $5.9bn estimate and six times the original $2bn estimate. According to Snowy Hydro chief executive Dennis Barnes, this was as a result of “an incredibly comprehensive (review) process”.

But despite numerous requests for detailed information to explain the $6.1bn blowout of this taxpayer-funded project and how it still could be a commercial investment, all that has been released is a one-page ministerial media release, a Snowy Hydro News sheet and a heavily redacted response to a Senate notice.

This, of course, completely contradicts the Albanese government’s promises to be “committed to being transparent and honest with the Australian people about the challenges and opportunities for Snowy”.

But then, BFD readers will know all about left-wing governments who blatherskite about being “the most open and transparent” governments ever.

Since Snowy 2.0’s announcement as “a nation-building, electricity game-changer” in March 2017, no detailed financial information has been released. In fact, every estimate and claim has been wildly inaccurate, and this latest reset appears to be no different.

Since 2017, the estimated cost of the project has been “reset” from its original $2bn, to $3.8bn, in just 2017. Two years later, it was $5.1bn. In 2020, $5.9bn.

Now, it’s skyrocketed to $12bn.

It was telling that the previous Snowy Hydro boss, Paul Broad, was astonished by the reset: “I’m a bit shocked. I don’t know where this $12bn comes from, that’s news to me. Twelve months ago it was nothing like that. That seems mad.”

It is mad. But then, this is a project so insane that a single stuff-up added $2bn.

When gigantic tunnel-boring machine “Florence” hit a patch of soft, water-laden ground (which was already known about) without its critical “slurry system” in place, it ground to a halt – and caused a gigantic sinkhole. When workers tried to stabilise the ground by pumping in thousands of litres of grout, cement and polyurethane foam, the resulting chemical reaction flooded the tunnel with toxic gas.

Just 18 months into a journey that’s supposed to see it tunnel through 15km of mountains, Florence has dug a whopping 150m.

No climate clown show is complete without a ‘Boofhead’, of course: Australia’s Minister for Climate Change and Energy, Chris Bowen.

What, him? Worry?

Bowen says Snowy 2.0 still has a net value and he is concerned about wasting the sunk costs: “There’s still $3bn net value, and of course it is 40 per cent built, so it would be a huge waste of money to cancel it at this point.”

The question taxpayers must ask, though, is, should we keep throwing good money after bad?

It’s important to realise that previous cost estimates have covered only the main works, and it is expected this largely remains the case with the latest reset, though not even this most basic of financial information has been released.

Missing project components, such as financing, design, owner’s costs, exploratory and other works, and the segment factory, will add many billions by the time the project is completed.

Also, 1000km of transmission lines are being built primarily to connect Snowy 2.0 to Sydney and Melbourne (HumeLink, Sydney Ring South, VNI West) at a cost of more than $10bn.

The all-up cost for Snowy 2.0 and its transmission connections is now approaching $25bn – an absurd amount for a 2200MW water battery.

And is it really “40 per cent built”?

All that has been achieved in the 6½ years since Snowy 2.0’s announcement are two 3km access tunnels to the location of the power station caverns, 80,000 concrete tunnel lining segments, lots of roads and construction sites, and other preliminary works. Substantially more than 60 per cent of construction lies ahead – two massive underground caverns, extensive mechanical and electrical equipment at four sites, 27km of water tunnels, four transmission circuits through Kosciuszko National Park and associated works […]

How much more taxpayer money will the government squander on Australia’s biggest energy debacle?

The Australian

“Biggest energy debacle” – so far.

Now do the sums on the rest of Bowen’s deranged “Net Zero” plans.

They make Snowy 2.0’s $12bn blowout look like a rounding error.