AEMO Confirms Outlook Update After Snowy 2.0 Delay
The Australian Energy Market Operator will revise its annual electricity outlook after Snowy Hydro admitted a further 10-month delay to Snowy 2.0, now due in October 2029. Updated forecasts are likely in early December, while debate grows over the Eraring coal plant.
The Australian Energy Market Operator (AEMO) has confirmed it will revise its annual electricity outlook, after Snowy Hydro said last month that its Snowy 2.0 pumped hydro project will be delayed by a further 10 months, to October 2029. The project's cost is now put at $22.2-$25 billion.
AEMO is updating its Electricity Statement of Opportunities, a yearly report that flags where the grid could run short of supply. Staff are working on the revised forecasts, and results are likely to be made public in early December.
What the current outlook says
The existing report mentions Snowy 2.0 only briefly. It notes the project's 2.2 gigawatts and 350 GW-hours of capacity would come online in New South Wales "from December 2028".
The report did not estimate any unserved energy beyond the reliability standard in the National Electricity Market before 2032-33. Without action, the gap might lead to blackouts in that fiscal year in NSW, South Australia and Victoria.
An AEMO spokesperson said revisions are hardly unusual. The agency has recorded such updates in five of the past six years.
Earlier revisions
The spokesperson listed several. The 2025 update covered the delayed retirement of three units at the Torrens Island B Power Station in South Australia, and the earlier potential closure of the Gladstone Power Station in Queensland, moved from 2035 to March 31, 2029.
The 2023 update extended the Interim Reliability Measure from June 30, 2025 to June 30, 2028. The 2021 update brought forward the Eraring closure from 2032 to 2025-26. The 2020 update moved Yallourn's retirement to mid-2028 from 2032.
Blackout warnings and Eraring
Murdoch tabloids raised the prospect of millions of households facing rolling blackouts because of the latest Snowy 2.0 delay. They urged authorities to scrap a deal to shut the nation's largest coal-fired power station.
Origin Energy, which owns the Eraring plant in the lower Hunter region of NSW, remains committed to closing it in April 2029. Speculation is mounting that the Minns Labor government will seek an arrangement to keep at least two of its four 720-megawatt units running beyond mid-2029.
Premier Chris Minns vowed before the March 2023 election to review plans to shut Eraring as early as August 2025. That assessment led to an extension of as much as 44 months.
Unplanned outages at aging coal plants can spike wholesale power prices, as happened this spring in NSW and elsewhere in the market. Notionally available units do not always deliver if equipment fails.
Heatwaves arriving earlier in spring and later in autumn also shorten the "shoulder" seasons when fossil fuel plants carry out maintenance. Extra air-conditioning use can lift demand and wholesale prices.
AEMO said that "large-scale, long-duration storage projects like Snowy 2.0 will play an important role in the NEM".
