3 May 2023

Snowy Hydro announces deadlines have been pushed back

| Gail Eastaway
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Snowy Hydro 2.0 Talbingo

The excavation site for Snowy Hydro 2.0 at Talbingo. Photo: Snowy Hydro Facebook.

The announcement on Wednesday (May 3) that the Snowy 2.0 project is about two years behind schedule has not surprised many commentators or locals who have been affected by the project.

Snowy 2.0 has had significant impact on local communities, both positive and negative, since its launch by then-prime minister Malcolm Turnbull in 2017.

Snowy Monaro Mayor, Narelle Davis commented on this latest announcement: “Snowy 2.0 is experiencing the same issues as many major projects across the country.

“The original Snowy Scheme experienced many of the same issues.

“The Snowy 2.0 project is a major economic driver in our community. Receiving this update gives the community a timeline for delivery of this important project,” Mayor Davis said.

Snowy Hydro has advised its management team is working towards resetting the delivery timeline and budget for the Snowy 2.0 project with its principal contractor, Future Generation Joint Venture (FGJV), as part of an ongoing project review.

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“The reset will ensure this critically important clean energy infrastructure project is placed on a robust and sustainable footing for FGJV to progress the schedule in a realistic and productive manner.

“While significant progress has been achieved by FGJV on Snowy 2.0, there are delays to Snowy 2.0’s contracted schedule and likely cost impacts beyond the contingency allowed, which remain under review by Snowy Hydro”, the corporation advised.

There are four broad categories of factors contributing to schedule delays and likely cost increases:

  • the mobilisation and resourcing implications of the COVID-19 pandemic;
  • the effect of global supply chain disruption and inflation impacting the cost and availability of a skilled workforce, materials, and shipping;
  • a number of design elements requiring more time to complete due to their technically complex nature, with the final design now being more expensive to construct; and
  • the impact of variable site and geological conditions, with the most impactful being the soft ground encountered that is delaying tunnel boring machine (TBM) Florence’s progress at Tantangara.

Snowy Hydro anticipates that the timeline for full commercial operation will be delayed by a further 12 to 24 months from the current publicly released dates, which indicated first power was scheduled to come online in June 2027 at the earliest, and commercial operations were expected by December 2029 at the latest.

Snowy Hydro said it expected more detail on the budget implications of the project reset around July 2023, and this would be clearly communicated with key project stakeholders.

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Snowy Hydro CEO Dennis Barnes said, “Since joining Snowy Hydro earlier this year, I have focused on ensuring our major projects are placed on a realistic and sustainable footing, while maintaining construction progress.

“This project is critically important to the transition of Australia’s electricity grid, and it’s crucial that we are working to a safe, efficient and realistically achievable timeframe to enable orderly planning for all our stakeholders. I am committed to being transparent about our progress and how we are proactively managing the inevitable issues and challenges that arise in a complex project like this.

“While many other major infrastructure projects have been impacted by the same challenges, Snowy 2.0 continues to make positive progress.

“Snowy 2.0 is providing significant employment and economic benefits both regionally and domestically. There are currently over 2400 people employed on the project and thousands more jobs generated indirectly through supply chains and support services.

“TBM Kirsten has tunnelled 2.9 km to reach the underground power station cavern complex and we now have access to this site from both ends. We shortly expect to commence the 6 km tailrace tunnel that will feed into Talbingo Reservoir and the excavation of intakes at Talbingo and Tantangara are proceeding very well,” Mr Barnes said.

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