The Australian government has made hydropower a priority agenda item, to help deliver a more reliable and affordable energy system for all Australians, writes Minister for the Environment and Energy, Hon Josh Frydenberg MP.

Since the 1890s, hydropower has been a source of energy in Australia, primarily in our southernmost state of Tasmania. It was in 1974, however, when it took on “iconic” status with the completion of the Snowy Mountains Hydro-Electric Scheme, our largest ever engineering project.    

Only two per cent of construction was visible above ground, yet the scheme included 16 major dams, seven power stations, a pumping station and 225 kilometres of tunnels, pipelines and aqueducts. It was an engineering feat of international renown that provided a platform for Australia’s economic development for decades to come.

Today, hydropower is our largest contributor to renewable energy. In 2016, it provided 42 per cent of total renewable electricity supplied and seven per cent of Australia’s total electricity.

Australia’s energy system, however, is currently undergoing its biggest transition in a century. As more intermittent renewables namely wind and solar penetrate the grid, more backup supply is needed to boost reliability and prevent price volatility.

This point was highlighted by our Energy Security Board’s recent Health of the National Electricity Market report which found that despite the unprecedented amounts of renewables being delivered before 2020, “very few megawatts of power that can always be dispatched has been added to the NEM”.

While storage can come in many forms, including lithium-ion batteries and hydrogen fuel cells, pumped hydro technology is the most dominant, responsible for 97 per cent of the world’s energy storage. Indeed, in a recent report on energy storage by Australia’s Council of Learned Academies, it was said pumped hydro is “the most cost effective for delivering energy reliability”.

A study by the Australian National University and supported by the Government’s Australian Renewable Energy Agency identified over 22,000 possible off-river pumped hydro energy storage locations nationwide, but no large-scale facilities have been built in Australia in the last 30 years.

In 2017 though, the Australian Government put hydropower back in the spotlight.

Announced by Prime Minister Malcolm Turnbull in March 2017 and now underway is the gamechanging project that will expand the capacity of the iconic Snowy Mountains Scheme by 50 per cent. Dubbed Snowy 2.0, the additional 2,000 MW of capacity and 350,000 MWh of storage represents the largest energy storage project in the southern hemisphere and the largest renewable energy project in Australia.

Creating up to 5,000 jobs and producing enough power for 500,000 homes, it will involve 27 kilometres of tunnels and a new power station that will be up to one kilometre underground. Ten-and-a-half hours of pumping the 650 metres uphill will deliver eight hours of generation downhill. Cheap energy in the middle of night – especially windy nights – will be used to pump uphill and then on a hot Australian afternoon, Snowy 2.0 will provide electricity right when it is most in demand.

With the capacity to store enough energy to run for seven consecutive days at its maximum output, Snowy 2.0 will be Australia’s biggest battery.

In Tasmania, where hydropower has been a source of energy for more than 100 years, pumped hydro energy storage offers the island state the potential to become the “battery of the nation”.

The Australian Government is exploring whether expanded pumped hydro technology in Tasmania, backed by a second Tasmanian interconnector to the mainland, would deliver similar benefits for our National Electricity Market that Snowy 2.0 promises to deliver. This includes examining pumped hydro projects that can deliver an additional 2,500 MW of capacity.

In Queensland, we are supporting the redevelopment of a mine site which will co-locate a large scale solar farm with a large scale pumped hydro project and use two former mining pits as the upper and lower reservoirs. We have also undertaken a feasibility study into a pumped hydro facility in South Australia that would be the first in Australia to make use of seawater.

Pumped hydro not only provides energy storage, but also can provide grid stabilisation services, such as voltage and frequency control. This flexibility makes it a particularly valuable player of the National Energy Guarantee – our energy policy that will not only improve reliability in the National Electricity Market, but also help us meet our Paris Agreement commitment to reduce emissions by 26 to 28 per cent by 2030 on 2005 levels at the lowest possible cost.

With an energy system undergoing its biggest transition in a century and no large-scale pumped hydro facilities having been built in the last 30 years, energy storage in Australia has never been more important.

That is why the Australian Government has made hydropower a priority agenda item, to help deliver a more reliable and affordable energy system for all Australians.

This piece was originally featured in the 2018 Hydropower Status Report.