Snowy Hydro boss Paul Broad resigns amid tensions with Chris Bowen

Paul Broad, the chief executive of government-owned electricity utility Snowy Hydro, has quit after a series of disagreements with Climate Change and Energy Minister Chris Bowen over cost blowouts in the controversial Snowy Hydro 2.0 scheme and the use of green hydrogen in the Kurri Kurri power plant.

Labor had initially criticised the proposed $600 million Kurri Kurri gas power plant when it was announced by the Morrison government but in February, it swung in behind the project and promised an extra $700 million in equity funding to allow the Snowy-owned plant to run on 30 per cent green hydrogen.

The Snowy Hydro 2.0 scheme, meanwhile, has hit by cost blowouts and project delays because of the pandemic and the rising cost of materials, though a company source, who asked not to be named, told The Sydney Morning Herald and The Age that the cost blow outs for the $5.1 billion project would end up being about a quarter of the $2.2 billion recently reported in The Australian.

Since the election, Bowen and Broad have had a series of discussions over the delays to Snowy Hydro and whether it was technically feasible for Kurri Kurri to run on 30 per cent green hydrogen when it begins operating, which is due to occur at the end of 2023.

Three separate sources, including the one linked directly to the company, said that Bowen was furious with Broad’s blunt message that 30 per cent was not initially possible because of technology constraints and the high economic cost, and had not accepted Broad’s advice.

The company source said that Broad had had a bad first meeting with Bowen and “that didn’t do him any good”.

A front page story in the Newcastle Herald on Monday, which suggested the federal government was backing away from its plan to have the plant use 30 per cent green hydrogen, was the final straw: at that point, the three sources said, Broad’s position was no longer tenable.

“They had had a series of robust conversations about Kurri and the delays to Snowy, which Broad explained away because of COVID.” a second source familiar with discussions between Broad and Bowen, who also asked not to be named, said.