Australia Clears $3 Billion Plan to Link Troubled Hydro Project

(Bloomberg) -- Australia approved a A$4.8 billion ($3 billion) transmission project to connect more renewable energy to its main grid, including from a massive hydropower project that has been plagued by delays and cost overruns.

The clearance comes as the nation undergoes one of the world’s fastest transitions away from a grid heavily reliant on coal-fired power plants to solar and wind generation, which require batteries or hydropower to back them up when the sun doesn’t shine or gusts don’t blow. The issue of how to ensure stable supplies has become increasingly political ahead of elections due by May, with the main opposition party last week laying out a A$331 billion plan to create a nuclear power industry.     

The HumeLink project will construct 365 kilometers (227 miles) of high-voltage cables between three towns in New South Wales state, allowing the connection of 3 gigawatts of renewable capacity, including 2.2 gigawatts from Snowy 2.0, Environment Minister Tanya Plibersek said Thursday. The opposition’s nuclear plan “takes too long, costs too much and puts up power bills” as well as threatening investment in renewables, she said. 

HumeLink has been plagued by cost overruns and concerns over the impact the overhead lines could have on local communities. Meanwhile, Snowy 2.0 was originally set to cost A$2 billion and be completed this year, but that has ballooned to an estimated A$12 billion and commercial operation in December 2028 after a series of setbacks including collapsed tunnels that trapped drilling machines.

Plibersek has this year also approved controversial coal mine expansions and has to make a decision on the extension of the nation’s biggest liquefied natural gas project, which critics say could release 4.3 billion tons of carbon dioxide — or almost 10 times Australia’s annual emissions.

©2024 Bloomberg L.P.