Queensland Labor’s Pioneer-Burdekin Pumped Hydro Project ‘commercially unviable’, report finds
A mega pumped hydro storage project presented as a centrepiece of Queensland Labor’s re-election platform was ‘commercially unviable’ and would cost more than double its planned $12bn price tag, according to a report.
A mega pumped hydro storage project presented as a centrepiece of Queensland Labor’s re-election platform nine days ago was “commercially unviable”, would cost more than double its planned $12bn price tag and could not be built in time to meet the state’s emissions targets, according to a report by the company set up to build the facility.
During the election campaign, then-premier Steven Miles had touted the Pioneer-Burdekin Pumped Hydro Project as the key to the state’s green transition plans, and the project was endorsed by Anthony Albanese as “visionary”.
But just days after the Labor election loss, the pumped hydro plan has been shot down.
The long-awaited Detailed Analytical Report by Queensland Hydro, controversially delivered in the days after the October 26 state election, formally recommended against going ahead with the mega-Pioneer-Burdekin project, touted as the “only option” to guarantee certainty of Queenslanders’ power as the state transitions to renewable energy.
The report, initially scheduled to be completed mid-year for the Miles government cabinet for final sign-off, found massive cost blowouts and no evidence to support building a pumped hydro project of its size.
Queensland Hydro calculated that the cost of Pioneer-Burdekin – the world’s biggest ever proposed pumped hydro project and long opposed by the newly elected Liberal National Party Premier David Crisafulli – had gone from an initial estimate of $12bn to between $24.985bn and $27.67bn.
Along with the smaller-scale pumped hydro project at Borumba, near Gympie, Pioneer-Burdekin was deemed crucial to providing a combined 7GW in grid-scale storage capacity, and certainty of power for up to 24 hours, as Queensland moves to its legislated targets of 50 per cent statewide renewable generation by 2030, and 80 per cent by 2035.
Under the Labor government’s Energy and Jobs plan, Pioneer- Burdekin’s large capacity would enable the phase-out of the five state-owned coal-fired power stations by 2035, to meet the legislated target to slash 75 per cent of carbon emissions within a decade.
The Pioneer-Burdekin project, proposed for a site 70km west of Mackay in north Queensland, was to deliver 5GW of long-duration storage and be completed in two stages, in 2032 and 2035.
But in its report, Queensland Hydro estimated the project was years behind its scheduled development and would delay the closure of the power stations.
Instead, the report said there was now only a 50 per cent chance that Stage One of the project would be built by 2035, and the second stage of the project, which was to be completed by 2035 – when the state was planning to close the last of its fleet of coal-fired power stations – had only a 50 per cent chance of being completed by 2038.
The report recommended that the incoming LNP government should consider smaller versions of the project at the same location.
It found that the 5GW, two- stage project “fails to recover its significant capital investment through revenue”.
The report also revealed that the former Labor government, which initially announced its proposal for the mega pumped hydro scheme in 2022, failed to properly analyse the need of the state’s electricity grid for such a big project.
In the absence of the analysis, Queensland Hydro said it could not back the project.
“While it offers positive economic, social, and environmental benefits, it results in a negative net present value of $4.337m (P50) and $6.865m (P90),’’ the report said.
“Without the System Level Analysis clearly demonstrating Queensland’s need for a 5000MW PHES scheme, Reference Project Option 1 cannot be deemed commercially viable.”
The LNP previously supported the construction of the $14.2bn Borumba pumped hydro scheme, but announced earlier this year that, if elected, it would not go ahead with the Pioneer-Burdekin project and would repeal the state’s renewable target. Just days after the LNP won government, Mr Crisafulli last week formally cancelled the Pioneer-Burdekin project.
Newly sworn-in Treasurer and Energy Minister David Janetzki said the report revealed the Labor government had misled voters.
“Queenslanders now know Labor’s so-called Energy and Jobs plan was nothing more than a cheap charade which has completely collapsed under scrutiny,’’ Mr Janetzki said.
“The centrepiece of Labor’s emissions plan has been exposed as unviable and unworkable, nothing more than a desperate hydro hoax designed to clinch an election win. The truth is, Labor could never have met the 2035 emissions targets …”
On Sunday, a spokesman for Queensland Hydro said the report was only finalised on October 30 and delivered to the LNP government the next day.
“Final analysis of the options, and conclusion of all studies, was completed during the caretaker period, so it was not provided at that time to either the then government or opposition,’’ the spokesman said.
He said Queensland Hydro had sought to delay the delivery of the report earlier in the year.
“For a project of the scale and complexity of Pioneer-Burdekin, it was vital that the economic, environmental, and social impacts and benefits were the subject of comprehensive independent assessment by Queensland Hydro,’’ the spokesman said.
“In early 2024, Queensland Hydro wrote to the Queensland government, seeking a date of the end of 2024 to complete the DAR and to finalise the evaluation of additional design configurations in order to ensure Queensland Hydro was providing the most robust analysis of an incredibly complex and large project.”
Last month, The Australian revealed delays in development work on both hydro projects.
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