New power station for Snowy Mountains Scheme could cost double $2b estimate

THE cost of adding a giant hydro-electric power station to the Snowy Mountains Scheme could be double the initial $2 billion estimate.

THE cost of adding a giant hydro-electric power station to the Snowy Mountains Scheme could be double the initial $2 billion estimate.

Snowy Hydro bosses have revealed that price tag does not include installing new power transmission lines to hook up the station to the national electricity market.

A proposed four-year timeline to build the complex system of tunnels connected to an underground cavern for the power station is also unlikely, given the difficult geology faced by engineers.

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Snowy Hydro Limited chief executive Paul Broad told a Senate estimates hearing that a $29 million feasibility study into the project — announced by Prime Minister Malcolm Turnbull in March — was in “full swing” and would be completed by the end of the year.

He said $2 billion was the “very, very rough top level estimate to build the whole scheme”.

But under questioning from Greens senator Larissa Waters, Snowy Hydro Limited chief operating officer Roger Whitby said work was being done with power company TransGrid to determine the cost of building new transmission lines so the scheme would be “feasible more broadly in providing benefits to consumers”.

He said this would likely cost less than $2 billion but more than $1 billion.

Snowy Hydro chief Paul Broad and Prime Minister Malcolm Turnbull. Photo: Andrew Taylor.

Mr Broad said the 2000 megawatt facility — which could power up to 500,000 homes — was announced less than a fortnight after the first discussions with the Prime Minister’s office.

Mr Turnbull has trumpeted the project as a key measure to reduce power prices.

Mr Whitby said the new power station could be designed to produce up to 8000 megawatts, but that would be less economically viable.

The Senate hearing was told that in a best-case scenario, the project would be finished in four years, but that it could take up to a decade.

Machines will begin testing the ground within the next four or five weeks.

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