Snowy Hydro’s chief executive, Paul Broad, has resigned, leaving the commonwealth-owned power generator at a time when its signature Snowy 2.0 project faces cost blowouts and falls further behind schedule.
In a statement on its website, Snowy Hydro said Broad had led the organisation since 2013, transforming it into “a dynamic and integrated energy business”. It did not give a reason for his departure.
A spokesperson for federal energy minister, Chris Bowen, offered modest praise, saying the government “notes” Broad’s resignation after almost a decade of service, and thanked him “for his work in the energy market over that period”.
“The government values Snowy Hydro and its critical role in supporting a changing grid,” the spokesperson said.
In 2017, then prime minister Malcolm Turnbull announced the Snowy 2.0 pumped hydro project as a $2bn venture that could start supplying electricity to the grid by 2021. But that price could end up being more than $5bn with Snowy Hydro’s latest commitment date set at December 2026 and likely to be delayed further.
The project involves challenging engineering as it links two existing dams, Tantangara and Talbingo, through 27km of tunnels, and includes constructing a new power plant underground. The upper lake serves as a form of giant battery.
However, industry insiders have questioned Snowy Hydro’s role in the spike in wholesale prices in recent months.
According to the Australian Energy Market Operator’s (Aemo) recent quarterly report on the National Electricity Market (NEM), hydro plants set prices for almost half of the time in the June quarter. That was up from 31% in the previous three months.
“Almost all of this increase can be attributed to increased price setting frequency by Snowy Hydro’s Tumut and Murray generators which set prices in 17% and 15% of intervals, respectively, in Q2 2022,” Aemo said.
But a person familiar with the energy ministers’ meeting in Canberra earlier this month said Snowy Hydro’s market behaviour was not mentioned during discussions of the NEM’s suspension in June.
Guardian Australia contacted Snowy Hydro for additional comment.
The head of the Victoria Energy Policy Centre, Bruce Mountain, said Broad’s exit had come “not a moment too soon”.
“The budget for Snowy 2.0 has blown out badly and they have only just started the project,” Mountain said. “It has long been obvious that it would be disaster and this is simply the next chapter in the saga.”
Dylan McConnell, an energy expert at the University of Melbourne, said Broad’s exit “does seem to be an opportunity to review the role of the commonwealth within the NEM and the role of Snowy”.
His departure was a form of “changing horses in mid-stream given Snowy 2.0 is at a fairly delicate stage”, McConnell said.
Snowy Hydro said its board will now commence a process to identify “new leadership”, with the chief operating officer, Roger Whitby, holding the fort in the interim.
