Labor leader Steven Miles said Queensland Hydro never raised viability concerns about Pioneer-Burdekin

Ousted Labor premier Steven Miles denies he deliberately misled voters about the multibillion-dollar cost blowout on his government’s centrepiece energy project, despite knowing other options were being investigated.

Queensland Labor leader Steven Miles.

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The former Palaszczuk-Miles Labor government never did checks on whether its multibillion-dollar Pioneer-Burdekin Pumped Hydro Project was needed to meet future demand of the statewide power grid.

As ousted Labor premier Steven Miles on Monday denied he deliberately misled voters about the centrepiece of the government’s transition to 80 per cent renewable energy, the state company set up to build the Pioneer-Burdekin energy storage project confirmed that the analysis had still not been completed, despite Labor campaigning on the merits of the project ahead of the election.

Touted to be the world’s biggest-ever pumped hydro scheme at five gigawatts, Pioneer- Burdekin was sold to taxpayers as “critical” to meeting the state’s green transition plans.

But after winning the October 26 state election, the Liberal National Party government released a detailed analytic report revealing the project was unviable and would cost more than double its initial $12bn price tag.

Queensland Hydro calculated the cost for Labor’s 5GW proposal had blown out to between $24.985bn and $27.67bn.

The report was meant to be made public in June, but Queensland Hydro sought an extension to the mid-year deadline so it could investigate other options, flagging early problems with the Pioneer-Burdekin proposal.

In its report, Queensland Hydro concluded that Pioneer-Burdekin was “commercially unviable” and cited the failure of the former Labor government to analyse the need for the proposed project and its capacity against the existing and planned network.

“In the absence of the system level analysis demonstrating Queensland’s need for a 5000MW PHES Scheme, Reference Option I (the announced Pioneer-Burdekin project) is not considered viable and should be modified to a smaller capacity’’ the report states.

In a statement to The Australian on Monday, Queensland Hydro said the analysis was being conducted by the Department of Energy and Climate and Queensland Treasury and was still not completed.

“There was no system level analysis completed in the Pioneer-Burdekin DAR by Queensland Hydro,’’ the statement reads.

“Queensland Hydro’s understanding was that government agencies were completing the system needs analysis that would be considered alongside the Pioneer-Burdekin DAR by decision-makers.”

The state-owned company’s report looked at two smaller options at the same location in the Pioneer Valley, which could cost up to $18.934bn and $21.537bn respectively.

It found Options 2 and 3 were “viable” and would provide financial return to the state.

On Monday, Mr Miles confirmed he was aware Queensland Hydro was investigating other options to the 5GW proposal Labor took to the state election, but refused to explain why he never made that public.

“I think it was always the intention that the detailed analytic report would identify the most viable option,” he said.

“We were waiting for a detailed analytic report, that’s what I’ve now seen – it identifies a project of exceptional value that would deliver 3.75GW of storage.

“Now that the new government has cancelled that project, the pressure really is on them.”

Asked if Queensland Hydro ever raised any concerns about the viability of the project with his government, Mr Miles said: “Not that I am aware of”.

He said the entity did not give a reason as to why it had requested an extension, “just that the report would take extra time” and refuted LNP claims that he had lied to voters about the cost blowout.

New Deputy Premier Jarrod Bleijie accused the former Labor government of deliberately hiding the cost blowout from voters “to try and sneak through the election campaign”.

“Everything in Labor’s energy and jobs plan rested on the Pioneer-Burdekin pumped hydro scheme, and it shows that it has been the biggest con job in Queensland history,” Mr Bleijie said.

“It’s implausible to think the Labor Party couldn’t achieve those figures and get those statistics, considering they had the levers of government.”

Before and during the election campaign, Mr Miles insisted he did not have an updated cost estimate for the project, only that it had originally been estimated to cost $12bn but would likely increase because of post-Covid cost escalations.

The new LNP government will not consider options 2 and 3 – for a 2.5GW scheme or 3.75GW scheme – put forward by Queensland Hydro.

Mr Bleijie said that was because of the “impact on the land, the environment, the people” and he had last week written to 57 landholders who had already sold their homes and properties to the government.

The new government will now enter negotiations with those landholders, but will take a staged approach to mitigate damage on price values in the region by flooding the market.

Treasurer David Janetzi said he wanted to “de-risk” the state’s energy transition by investing in smaller pumped hydro projects and partnering with the private sector.

The LNP had flagged plans to construct “more manageable” smaller pumped hydro projects to meet the state’s baseload power needs but had no plan on where or when they would be built or how much they were expected to cost.

During the election campaign, Mr Janetzki said he would “absolutely” commit to revealing how much taxpayer money would be invested in pumped hydro by his first budget, but on Monday was unsure.

“My hope is, I want to see a clear pathway and a clear road map on these projects, whether they’re absolutely specifically designated by then, we’ve got to do that hard work,” he said.

The LNP government committed to progressing the 2GW Borumba pumped hydro project, near Gympie, which is also facing delays and cost blowouts.

The Australian last month revealed the $14.2bn Borumba project was well behind in its development schedule and may not be able to meet its 2030 opening date.

Mr Janetzki said he expected to receive more information from Treasury at the end of the month, but could not say if Borumba was still on time and on budget.