Snowy Hydro’s Hunter Power Project (HPP) is entering its final phase of construction, aiming to become a crucial component in Australia’s energy transition. Located in Kurri Kurri, NSW, the fast-start gas power station is expected to supply 660 megawatts (MW) of dispatchable energy, with fuel storage capable of providing 34 hours of power.
The HPP will support Australia's move away from coal, enabling the integration of renewable energy by offering on-demand power during peak times or when wind and solar generation falls short. The plant’s capacity is intended to help firm up approximately 2 gigawatts (GW) of renewable energy.
Since August 2023, the project has made significant strides, with the completion of major civil works and the installation of key components, such as gas turbines and generators. The power station is expected to be partially operational by December 2024, although its first unit will run on diesel fuel for initial testing due to delays in the gas pipeline construction.
The HPP's reliance on diesel during its early operational phase is an adaptation caused by unforeseen delays in building the gas pipeline, which is now expected to be completed by February 2025. Diesel will serve as a backup fuel until the plant can switch to gas, with both fuels supporting the plant’s long-term operation. Each generator will be capable of producing 283 MW while running on diesel during the testing phase.
This operational adjustment has sparked concern, given the federal government’s initial stipulation that the plant would incorporate green hydrogen into its fuel mix. However, hydrogen infrastructure development has been slower than anticipated, with no clear timeline for its integration into the HPP.
Despite these hurdles, the HPP continues to provide significant economic benefits to the Hunter region. The project employs around 600 workers at its peak, with 60% of the workforce coming from the local area. Since June 2024, an additional 12 apprenticeship positions have been created in trades such as electrical and mechanical engineering, contributing to skills development and job readiness.
The Hunter Power Project’s completion comes as the Australian energy market faces growing challenges. With the closure of coal plants like AGL Energy’s Liddell in April 2023 and the slower-than-expected rollout of renewable energy, there are increasing concerns about ensuring a reliable power supply. Gas-powered plants, such as HPP, are considered essential for providing backup capacity when wind and solar power are insufficient.
Dennis Barnes, Snowy Hydro’s chief executive, emphasized the critical role the plant will play in enabling low-cost renewables. Barnes also acknowledged that the project's cost, initially budgeted at $610 million, has risen to $950 million due to weather-related delays, with further increases possible.
While Snowy Hydro has no immediate plans for further expansion into gas power generation, the HPP is poised to play a key role in stabilizing the energy market. However, the project’s reliance on fossil fuels during its initial phase has raised environmental concerns, particularly regarding particulate pollution in the Hunter Valley.
Image credit: By Dicklyon - Own work, CC BY 4.0, https://commons.wikimedia.org/w/index.php?curid=144952084