Finance Federal Budget Budget 2017: Snowy Hydro scheme infrastructure ‘benchmark’ but no money for buyback

Budget 2017: Snowy Hydro scheme infrastructure ‘benchmark’ but no money for buyback

Hydro electricity scheme pipelines in the Snowy Mountains. Photo: Getty
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A federal buyback of the Snowy Mountains Hydro scheme is the big idea at the centre of budgeted energy measures – labelling it the ‘benchmark’ for national building infrastructure – but there’s little money to back it up.

Treasurer Scott Morrison and Energy Minister Josh Frydenberg revealed on Tuesday the Commonwealth was in discussions with the NSW and Victorian governments to buy some or all of their stakes to add to its own.

The budget papers called this an “exciting idea” that comes as a study is underway into the scheme’s likely expansion, which Prime Minister Malcolm Turnbull has dubbed Snowy 2.0.

But there’s no money set aside for any buyback.

In his budget speech to Parliament, Mr Morrison said the government was “open to acquiring a larger share or outright ownership of Snowy Hydro, from the NSW and Victorian State governments, subject to some sensible conditions”.

“First, all funds received by the states would need to be reinvested in priority infrastructure projects.

“Second, Snowy Hydro’s obligations under its water licence would be reaffirmed and we would commit to work together to expedite and streamline environmental and planning processes associated with Snowy 2.0, without compromising any standards or controls.

“Third, Snowy Hydro would have to remain in public hands.

“We have already begun discussions with NSW and invited similar discussions with Victoria.”

Mr Morrison said the Prime Minister’s energy security plan provided “reliable and affordable energy for Australians coping with rising electricity prices”.

“The Prime Minister, the Energy Minister and other ministers are working to improve energy regulation, with additional funding tonight to improve gas-market efficiency and transparency. And he is investing in new generation, transmission and storage capacity,” Mr Morrison said.

Other energy measures include:

  • $110 million to help build a solar thermal plant in Port Augusta, South Australia, including a further $36.6 million over two years to invest in other energy infrastructure, with the money coming from an asset recycling deal.
  • $86 million in measures to shore up the domestic gas market
  • $30 million for scientific assessments at three sites – yet to be decided – of the impact on water supplies of possible new unconventional gas developments.
  • $28.7 million to accelerate “responsible development” of onshore gas sources for the domestic market
  • $20 million on a Gas Market Reform Group to improve transparency in the sector.

— with AAP

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