Pumped hydro sites in Tasmania that could store as much energy as 300 Tesla big batteries will get taxpayer support if they stack up economically.
Prime Minister Scott Morrison is confident the projects will make financial sense and provide significant energy security for Victoria.
Tasmania will spend $30 million on feasibility studies to investigate three pumped hydro storage sites in Tasmania as part of the Battery of the Nation project.
“I’m very confident about the outcome … If you don’t have projects like this, then you lose the value of a lot of those renewables,” Mr Morrison told reporters in Tasmania on Wednesday.
“You get a lot of dumping of generated electricity out of the renewable sector, which can’t be accommodated in your market.
“If you want to have a renewables future, you’ve got to have big batteries like this.”
The three sites in northwest Tasmania have a combined storage capacity of up to 40GWh, equivalent to more than 300 of the Tesla batteries installed in South Australia.
Pumped hydro uses cheap electricity – usually at night – to pump water up a hill and into a dam, where it is stored.
When energy demands start to peak during the day, the water can be released downhill through turbines to generate power.
Taxpayers will help fund the Tasmanian projects if the results of feasibility studies are positive.
The announcement comes two days after Mr Morrison promised $56 million to fast-track development of a second interconnector between Tasmania and Victoria.
When built, the Marinus Link will be another option, along with Basslink, to send power from Tasmania to meet peaks in mainland demand.
Tasmanian Energy Minister Guy Barnett said the Marinus Link project will look at a 600MW cable and a 1200MW option.
Mr Morrison said Tasmanians wouldn’t be stung for the cost of the cable, which will help keep prices down and power reliable in Victoria.
“Those who are buying the energy will pay for the energy,” the prime minister said.
At the moment, about 400MW of available dispatchable generation cannot be delivered to the mainland due to constraints on Basslink, which is more than 15 years old.
On Tuesday Mr Morrison announced $1.38 billion to support a pumped hydro project on the Snowy Hydro scheme in NSW.
Labor leader Bill Shorten said pumped hydro schemes could be good, but they needed more wind and solar power to help them stack up economically.
He said Labor’s higher renewable energy target was the best way to make these major projects viable.