350 GWh Snowy 2.0 project cost update now peaks at $25 billion

Snowy Hydro has updated the cost forecast for Snowy 2.0 to between $22.5 and $25 billion at commissioning in 2029, up from $12 billion estimated in 2023 and a 2017 opening bid of $2 billion. The contractor, Future Generation Joint Venture, attributes the escalation to underestimated delivery scope, missed productivity targets due to construction complexity, design revision following technical analysis, and global cost inflation on equipment and labour. The project moved off a fixed-price contract in 2023, shifting cost risk from the contractor to Snowy Hydro and ultimately taxpayers.

Where this fits

Snowy 2.0 is firm, dispatchable storage and essential firming infrastructure for a renewables-heavy grid. The cost trajectory, from $2 billion to $25 billion in nine years, is a textbook case of whole-system cost undercount. It bears hardest on the sovereignty and cost pillars: Australia is spending $25 billion to build storage capacity to back weather-dependent generation, money that could have accelerated the one firm, low-emission, low-material power source already permitted and fully domestic: nuclear energy.

What it means

A 12-fold cost overrun on a storage megaproject reflects the real complexity of firming a wind and solar grid at scale. Snowy 2.0 will work, long-duration storage is genuine capacity, but it illustrates why the all-renewables path requires not just panels and batteries, but vast civil infrastructure, all priced and built in an inflationary era. Australia is now committed to spending $25 billion on storage to keep the lights on when the sun does not shine and the wind does not blow. That money is being spent because alternatives are ruled out by law.