Borumba pumped hydro: Qld government considers shrinking the project

The state government is reportedly considering downsizing the Gympie pumped hydro project as its costs keep growing.

Qld Hydro are in the exploratory phase of transforming Borumba Dam into a pumped hydro powerhouse. Borumba Dam, Saturday August 5, 2023. Picture: Christine Schindler

The Queensland state government was considering “downsizing the $18.4 billion Borumba pumped hydro project to manage a cost blowout and to allow for the discovery of a culturally significant site”.

“The 2-gigawatt capacity of the proposed hydro project south of Gympie could be reduced by one quarter or more as Queensland Hydro seeks to bring its budget back towards $14 billion, its cost before the latest increase, according to sources involved in the project who are not authorised to speak publicly,” the Australian Financial Review reported on Sunday.

Some contractors have reportedly been told to pause work until its scope is revised.

Images from the Initial Statement Advice report into the proposed Borumba Dam pumped hydro plant.

The Borumba Pumped Hydro Project is a 2000 MW pumped hydro energy storage system at Lake Borumba, near Imbil in the picturesque Mary Valley.

The site was identified more than 40 years ago as having significant potential for a pumped hydro scheme.

It was revealed in December 2024, it had already blown out by $4 billion and would not be ready until after the 2032 Olympic and Paralympic Games.

This price tag was up 30 per cent on the previous estimate of $14.2billion.

In addition, first power also won’t be drawn from Borumba Pumped Hydro until July 2033, instead of the originally forecast February 2032 — meaning Queensland will not meet its renewable energy targets.

Treasurer and Energy Minister David Janetzki said then there was a need to “work out a way forward to save the project”, with Queensland Hydro outlining how altering the size and capacity of the project would substantially reduce costs.

The Queensland Hydro briefing showed skyrocketing labour and material costs caused a third of the $4.2bn blowout.

Environmental offsets, the need to build a better workers camp, time delays, extra workers, insurance and project costs were among the other factors behind the cost increase.

Qld Hydro are in the exploratory phase of transforming Borumba Dam into a pumped hydro powerhouse. Borumba Dam, Saturday August 5, 2023. Picture: Christine Schindler

Queensland Hydro, in its report, stated there was an “opportunity for government” to consider an alternate design for the project to deliver best value for cost, reliability and electricity generation capacity.

Since coming to power in late October the new LNP government has ditched the larger Pioneer-Burdekin pumped hydro project near Mackay, is reviewing approvals for four large wind farms, and has rejected a $1 billion-plus funding request for a green hydrogen project.

The AFR reported Mr Janetzki saying on Sunday the government was considering its next move.

“We are saving Borumba pumped hydro and considering a range of options for its delivery,” Mr Janetzki is reported to have said.

The Borumba Project is currently undergoing early works onsite while Queensland Hydro seeks regulatory approvals.

It is designed to be delivered in two stages: exploratory works and main works, with exploratory works to occur first. More information about the stages can be found below.