True Cost of Queensland’s Axed Hydro Project Revealed to Be Over $36 Billion

Water being released from the EJ Beardmore dam into the Balonne river near St George, south-western Queensland, Australia on Feb. 26, 2020. AAP Image/Dan Peled

Newly elected Queensland Premier David Crisafulli has criticised the former Miles government for not being clear about the soaring costs of the proposed Pioneer-Burdekin pumped hydro scheme, which has been revealed to cost $36.77 billion, instead of the original estimation of $12 billion—three times the initial forecast.

Within his first week in office, Deputy Premier Jarrod Pieter Bleijie announced the cancellation of the project.

“I find it completely and utterly implausible that the former government wouldn’t have known about that,” Crisafulli told ABC Radio on Nov. 4.

Before the election, former Labor Premier Steven Miles had acknowledged the project’s hefty price tag—hailed as a key component of Labor’s renewable energy strategy—but insisted it would be a sound long-term investment.

“[Pumped hydro projects] are income-generating assets that will generate a return to Queenslanders, basically forever,” he said during his second election debate with Crisafulli.

“The capital cost, you’re right, is high, but the operational cost is very, very low, and the revenue from them is very, very high.”

Crisafulli Apologises to the Landholders

Meanwhile, Crisafulli visited the town of Eungella on Nov. 3 to meet with landholders whose properties were resumed for the project.

“What they’ve been through was horrendous,” he said.

The LNP government plans to focus on building multiple smaller pumped hydro plants at yet-to-be-determined locations without providing a projected cost.

“We have to find a way to deliver smaller, more manageable pumped hydro because it’s important if you’re going to firm up renewables, you need that,” Crisafulli stated.

The premier committed to advancing the Borumba pumped hydro project, located near the Sunshine Coast, at a reasonable cost.

The previous government had allocated $6 billion toward this project, with the total reaching $14 billion.

Energy Councils Proof Will be in the Pudding

Tom Monaghan, communications advisor at the Energy Council of Australia, said the LNP’s approach could yield short-term benefits in affordability and stability, but may also create tensions with Australia’s broader renewable energy and emissions targets.

“While this approach reduces upfront investment, it is yet to be seen if smaller projects will deliver the same capacity. Smaller, distributed projects could also introduce additional grid-balancing complexities,” Monaghan wrote.

“While Crisafulli’s administration supports Australia’s net-zero goal by 2050, it remains sceptical of the feasibility of interim state-specific renewable targets.”

AAP has contributed to this article.