Snowy 2.0 defends timeline as it launches new $75 million machine amid cost blowout review
Feb 2 2026
ABC News
The Snowy 2.0 project has faced cost blowouts and delays since it was first announced in 2017.
In short:
Snowy Hydro chief executive Dennis Barnes says the Snowy 2.0 project is on track to deliver power by the end of 2028, following several delays.
The company has acquired another tunnel-boring machine to make up for lost time, but it needs more money beyond its $12 billion budget.
What's next?
An independent cost reassessment process is expected to be finished in the first half of 2026.
Snowy Hydro says the Snowy 2.0 renewable energy project is on track to deliver power by the end of 2028, but is remaining tight-lipped about how much additional money it needs.
The project announced further cost blowouts beyond its $12 billion budget last year, and is undergoing a review before the company is set to ask the federal government for more money.
Snowy 2.0's costs have already blown out by $10 billion, and the start date has been repeatedly pushed back.
Recently, it acquired a fourth tunnel-boring machine (TBM) to make up for lost excavation time.
An underground construction site.
Workers operate underground around the clock on the Snowy 2.0 site.
Snowy Hydro chief executive Dennis Barnes said the largest challenges were now behind the project, which is now 70 per cent complete.
"You know an awful lot more when you're 70 per cent of the way through, than 40 per cent or 10 per cent," he said.
Cost blowout
Snowy 2.0 is Australia's largest renewable energy project and involves building a hydropower station 800 metres underground at Kosciuszko National Park, with 27 kilometres of underground tunnels linking Tantangara Dam to the Talbingo Reservoir.
Acting as a giant battery, the system will store excess power from wind and solar, and deliver it across the grid when needed.
A construction site nearby mountains.
The Snowy 2.0 project is located in the NSW Snowy Mountains.
The project is expected to provide up to 2,200 megawatts of electricity to the national grid and is anticipated to be completed by December 2028.
With an initial cost of $2 billion, it was expected to deliver its first power in 2021 when announced by the Malcolm Turnbull government back in 2017.
The cost was revised to $6 billion after a feasibility study, and later to $12 billion.
A further cost blowout came last October, when Snowy Hydro announced it would need even more money to deliver the project.
An opening of a concrete tunnel on a construction site.
The project is made up of around 40 kilometres of tunnels.
Mr Barnes said it was not favourable that the company would not be able to meet its $12 billion target and admitted previous cost assessments were not perfect.
"Two-and-a-half years ago, we did an awful lot of work to reassess the project," Mr Barnes said.
"We got some things right, we got some things wrong.
"The disappointment is we didn't foresee all of that in mid-2023."
A man in a yellow construction outfit, speaking at a lecturn.
Dennis Barnes previously attributed the cost blowout to productivity targets not being met and increasing supply chain costs.
Tight-lipped on money needs
A line-by-line cost reassessment process is expected to be complete in the first half of 2026, but Mr Barnes has not provided any indication of how much extra money the company needs.
Four months into that independent review process, Mr Barnes still declined to give details on the expected sum when questioned by the ABC.
Mr Barnes said they were currently working through the details, but the process would take time due to the site's complexities.
A construction worker walking along concrete underground.
There are currently around 5,500 people working on the project.
"We need to get it right, then we'll announce [the cost increase] at the time when we're confident," he said.
"So everybody gets the full explanation at the same time."
In October, federal Energy and Climate Change Minister Chris Bowen said the government would scrutinise the review's findings.
"This costs reassessment is disappointing, and the government will be scrutinising its findings — this project must be delivered, but it must come at value for the taxpayer," Mr Bowen said in a statement on October 3, 2025.
A man in a yellow construction outfit, speaking at a lecturn.
Chris Bowen at the official launch for tunnel-boring machine Monica.
A series of safety issues have previously plagued the project, including toxic gases filling the tunnels, the implosion of an industrial fan on-site and concerns over the status of refuge chambers, which are a "last resort" for workers trapped underground.
New $75m machine
The project's defence of its ability to meet its amended deadline has come alongside the acquisition of its fourth TBM, Monica, which was officially unveiled last Friday.
The company announced in August 2024 that it would need to buy the new machine after repeated problems with its existing machine, Florence.
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