Snowy Hydro

Snowy Hydro Limited

Type	Corporation
Industry	Energy
Founded	1949 (1949) as Snowy Mountains Hydro-electric Authority 2002 (2002) as Snowy Hydro Limited
Headquarters	Cooma, New South Wales, Australia
Area served	New South Wales, Victoria, Queensland, South Australia, and the Australian Capital Territory
Key people	Rick Holliday-Smith (Chairman) Bruce Hogan (Managing Director)
Products	Electricity generation
Services	Electricity retailing, and bulk water management
Revenue	A$953m
Operating income	A$961m
Net income	A$460m
Total assets	A$2,423
Total equity	A$1,956m
Owner(s)	Commonwealth Government (13%), Government of New South Wales (58%) and Government of Victoria (29%)
Employees	650
Subsidiaries	Red Energy Pty Limited and Valley Power Pty Limited
Website	www.snowyhydro.com.au

Snowy Hydro Limited is an electricity generation, electricity retailing, and bulk water management public utility corporation in Australia that owns, manages, and maintains the Snowy Mountains Hydro-electric Scheme which consists of nine hydro-electric power stations and sixteen large dams connected by 145 kilometres of tunnels and 80 kilometres of aqueducts located mainly in the Kosciuszko National Park. Snowy Hydro also owns and operates two gas-fired power stations in Victoria.

The company is jointly owned by the Commonwealth (13%), New South Wales (58%) and Victorian (29%) governments and whilst not a State-owned corporation, is established pursuant to the Snowy Mountains Hydro-electric Power Act, 1949 (Cwlth). Prior to its incorporation under the Corporations Act, 2002 (Cwlth), the company was previously known as Snowy Mountains Hydro-electric Authority.

Generating assets

The company manages the Snowy Mountains Scheme which generates on average around 4,500 gigawatt hours of clean, renewable energy each year, which is around 67% of all renewable energy in the mainland National Electricity Market in 2009.

The company owns an electricity and gas retailer, Red Energy which operates in Victoria, South Australia and New South Wales, a 300 MW gas-fired peaking power station in Victoria's Latrobe Valley and a 320MW gas-fired peaking power station at Laverton North near Melbourne.

The company's production assets are summarised in the table below. These assets are used to generate electricity for sale under contract to the National Electricity Market.

Name	Fuel	Type	Location	Maximum Capacity (MW)	Commissioned
Blowering	Hydro	Turbo-pump	Blowering Dam	80	1969
Guthega	Hydro	Turbo-pump	Near Guthega	60	1955
Jindabyne Dam	Mini Hydro	Turbo-pump	Jindabyne	1.1	under construction
Jounama	Small Hydro	Turbo-pump	Near Jounama	14.4	2010
Laverton North	Natural gas	Gas turbines	Laverton	163	2006
Murray 1	Hydro	Turbo-pump	Near Khancoban	950	1967
Murray 2	Hydro	Turbo-pump	Near Khancoban	550	1969
Tumut 1	Hydro	Turbo-pump	Tumut	330	1959
Tumut 2	Hydro	Turbo-pump	Tumut	286	1962
Tumut 3	Hydro	Turbo-pump	Tumut	1,500	1973
	Micro Hydro	Turbo-pump	Tumut	0.720	1994
Valley Power	Natural gas	Gas turbines	Traralgon	300	2002

Water storage and diversion

As part of the company's responsibilities for managing the Snowy Mountain Scheme, Snowy Hydro Limited also collects, stores, and diverts water for irrigation from the Snowy Mountains catchment west to the Murray and Murrumbidgee River systems under what is called the Snowy Water Licence. Granted as part of the Snowy Hydro Corporatisation Act, 1997 (NSW) for fixed five year terms, this licence prescribes the rights and obligations on the company with respect to the collection, diversion, storage, use, and release of water within the Snowy area. The Snowy Water Licence also imposes some obligations on the company in terms of releasing environmental flows east into the Snowy River and other rivers in the Snowy Mountains region.

Water flow management decisions

In early 2011, the company was accused of releasing water from the Snowy Mountains Scheme on 8 December 2010 at the height of regional floods on the Murrumbidgee River. It was claimed that the release of water at that time was unnecessary and the release was used by the company to generate electricity in order to trade on the National Electricity Market. Despite Lake Eucumbene, the body of water where the release originated, being at 28% of capacity, it was stated that nearly 6 million litres were released in order to generate power and flowed into lakes and rivers that were already at, or exceeding, capacity. The company denied the claims stating that it was operating within its licence that was set during a period of drought. A subsequent inquiry by the NSW government found that "The operations of Snowy Hydro Limited and State Water were consistent with the conditions of their respective operating licences." As part of its recommendations, the inquiry "proposed amendments to the Snowy Water Licence to enable better management of water releases from the Snowy Scheme following severe droughts."

Proposed public divestment

In December 2005, the NSW Government announced it would sell its 58% share in Snowy Hydro, expecting to yield A$1 billion. The Federal and Victorian governments had followed suit, announcing by mid-February 2006 the intent to sell their 13% and 29% respectively, with A$1.7 billion (ranging up to A$3 billion) expectations through a public float. Pre-registration for shares in Snowy Hydro opened in mid May and it was expected that the float would take place some time in July. Over 200,000 people pre-registered to purchase shares in the company over two weeks.

On 2 June 2006, the Federal Government announced that it would no longer sell its 13% stake in the project, effectively forcing the hands of the New South Wales and Victorian governments to follow suit. The aborted sale followed strong opposition from the public, including government MPs and prominent Australians.

Opposition to the sale

Prior to the sale announcement in 2005, there was a pronounced public opposition, which commenced when a band of notable public, other persons banded together to try to stop its privatisation.

The group who first joined together in an attempt to stop the sell-off included former Senior Engineer Max Talbot, Coral Talbot, former Snowy Commissioner Vin Good, previous Independent Candidate for the seat of Eden-Monaro Acacia Rose, John Gallard, Cooma-Monaro Shire Mayor Roger Norton and Snowy River Shire Mayor Richard Wallace.

Public rallies organised in Jindabyne and Cooma, with 500 and 200 community representatives attending respectively, exerted pressure on governments to withdraw from the sale and called for a Government inquiry.

The Snowy River Shire Council was the first to vote for a no sale of the Snowy Scheme leading over 100 Mayors from around NSW to vote against the sale. Key politicians to rally drawing in farmers, conservationists and ordinary Australians from around the country to stop the sale of the Snowy Scheme included:

• Sylvia Hale - Greens Member of the Legislative Council of NSW
• Peter Andren (since deceased) - Federal Member for Calare
• Tony Windsor - Federal Member for New England
• Bob Brown - Senator for Tasmania and Leader of the Australian Greens, who obtained legal advice that indicated that the Commonwealth Parliament voted on a 'motion' in Parliament and not a 'Bill' making the vote to sell Snowy Hydro Limited shares illegal.
• Kay Hull - Nationals Senator for New South Wales; despite voting for legislation in Federal Parliament
• Bill Heffernan - Liberal Senator for New South Wales; stating that it was not in Australia's interest to have the assets and rights if Snowy Hydro fall into foreign hands.

More than fifty prominent Australians, including Cate Blanchett, Malcom Fraser, Bill Hayden, and Bernie Fraser signed a petition asking the then Prime Minister John Howard to call off the sale.

In June 2006 the Prime Minister announced that the Federal Government would not sell their minority 'share' of the Snowy Scheme. New South Wales Premier Morris Iemma then abandoned the plan.

The Snowy Scheme had been 'corporatised' in 2002 on a promise to not privatise the Snowy Scheme^{[citation needed]} and entrusted the ownership to three government 'shareholders'. However, moves were already afoot to sell^{[citation needed]} the Snowy Scheme governments only revealing their intentions on 1 November 2005. In 2007 the NSW and Federal elections were held and Labor candidates Steve Whan (State) and Mike Kelly (Federal) committed not to sell the Snowy Scheme. A move by the New South Wales state government to privatise the energy sector was defeated before reaching Parliament by the Labor caucus.

Current market position

Despite the privatisation being cancelled in 2006, the company has continued to grow with investment into Snowy Scheme modernisation projects, cloud seeding, development of mini hydro opportunities such as the 14MW Jounama mini hydro and growth of its retailer, Red Energy.

In addition Snowy Hydro is seeking to expand its gas-fired power station portfolio. This strategy is aimed at reducing risks to the business due to its reliance on water as an energy source, and due to the Snowy Mountains Scheme's geographical isolation on the electricity grid making it subject to transmission constraints in some circumstances.^{[citation needed]}

See also

• Snowy Mountains Scheme

External links

• Construction Images
• Snowy Hydro company website
• Audiovisual titles relating to the building of the Snowy Hydro Scheme on australianscreen