Contributed by Ben Wilson

Scott Morrison threatened government intervention in the Snowy Hydro project and to replace the aging Liddell power station in NSW’s Hunter Valley. This opened the door to Energy Australia fast tracking  towards building a new 300MW power station.

Last Friday had been set as the deadline to sign on the deal. But Energy Australia retained doubts about its business suitability.

Kerry Schott, the chair of Australia’s Energy Security Board said in an interview with The Guardian, “One of the reasons given for [a taxpayer-funded plant in the Hunter] is it will flood the market with gas-fired power and when there’s a tonne of supply in the market, prices go down.

“We all learned this in economics. However, that doesn’t work when there are a whole lot of other things around that are cheaper in price, like wind, solar and big batteries, like pumped hydro and we’ve got Snowy 2.0 coming.”

The answer from the NSW and federal governments is to hand over a fistful of taxpayer money. The state will give $78 million, and Canberra has promised $5 billion  to develop hydrogen production. Money talks and Energy Australia took up the cause.

Liddell’s old  power station is set to close in 2023.

The Snowy Hydro project involves a new 1000MW gas plant at Kurri Kurri to cover the shortfall form the Liddell closure.

It turns out that the owner of the land earmarked for the construction work is Jeff McCloy, who is  a major Liberal party donor. This raises the question of conflict of interest, and a taskforce to investigate the project found that it is not necessary. closure  found that it not necessary. This raises further questions.

Regardless, energy minister Angus Taylor, finance minister Simon Birmingham, and prime minister Scott Morrison pressed ahead. Snowy Hydro was asked  to develop a business plan.

This comes at  a time when the use of gas as a power source has come into question. It is only slightly less polluting than coal, and also more expensive than clean alternatives.