Snowy Hydro CEO Dennis Barnes said the project reset would enable the commercially sustainable and successful delivery of the project.
Snowy Hydro said the fixed price EPC contract with Future Generation Joint Venture (FGJV) – comprising Webuild and its subsidiaries Lane and Clough – was no longer fit for purpose and it will be moved to the new model. Snowy Hydro will settle all outstanding claims with FGJV.
The review also included a reset of the gas-fired Hunter Power Project.
“I am committed to ensuring these critically important projects are transparent and are placed on a robust and sustainable footing. Moving to an incentivised target model with FGJV will result in closer collaboration, stronger oversight and alignment of interests between Snowy Hydro and FGJV, ” said Barnes.
As part of the reset, Snowy Hydro worked with FGJV and hydro technology contractor Voith Hydro to increase the completed scheme’s capacity. Snowy 2.0 will now deliver an additional 200MW, taking total capacity to 2,200MW. The first power will be produced in 2027 and a target date of December 2028 has been set for commercial operation of all units.
Webuild said it welcomed the announcement of the revised delivery timeline and budget.
“The announcement follows a comprehensive review conducted by the joint-venture and SHL of power optimisation opportunities, the contracted schedule, cost impacts and broader delivery challenges,” the company said in a statement.
Snowy 2.0 has faced challenges, including more than a seven-month delay to tunnelling on the headrace tunnel when a surface depression developed as the TBM was transitioning from soft material into harder rock conditions. TBM Florence was halted while ground stabilisation was carried out. Excavation is ready to continue once regulatory approvals have been received.
Construction of the pumped storage hydro scheme is now approximately 40% complete and Snowy Hydro says “solid progress” continues to be made.
Excavation of the main access and emergency cable and ventilation tunnels – around 6km of tunnelling – is complete. Excavation on the 6km tailrace tunnel has commenced and tunnelling on the 1.45km inclined pressure shaft will commence shortly.
Work on the underground power station is under way, with access available from both ends and excavation and support of cavern crowns is being carried out.
Excavation at the Talbingo intake (where water will enter during pumping and exit during generation) is 50% complete, with 310,000m3 of earth excavated, while the first stage of earthworks at the Tantangara intake are complete, involving the movement of 205,000m3 of earth.
Snowy 2.0 is Australia’s largest renewable energy project. It will link Tantangara Reservoir (top storage) with Talbingo Reservoir (bottom storage) through 27km of tunnels and a power station with pumping capabilities. This will enable water to be released for energy generation at times of peak demand and pumped back to the top storage when there is excess renewable energy in the system, ready to generate again.
