The cost of the delay-plagued Snowy 2.0 pumped-hydro project could potentially blow out to $25 billion — or more than 12 times the original price tag promised just nine years ago.

The Federal Government-owned Snowy Hydro has confirmed an updated target cost to complete the project would conservatively cost $22.2b “with an allowance for a cost scenario of $25 billion”, following a cost reassessment from principal contractor Future Generation Joint Venture.

The higher estimate is more than 12 times the original $2 billion cost promise when then Liberal prime minister Malcolm Turnbull announced an expansion of the original Snowy Hydro in southern NSW, completed in 1974 after 25 years of post-war construction without modern tunnelling machines.

The cost has also doubled from $12 billion estimated in 2023.

The new target completion date has also been pushed out to late 2029 — eight years later than originally promised in 2017.

Energy Minister Chris Bowen scrambled to defend the project on Friday, telling News24 he still believed it remained a good use of taxpayer money despite “disappointing” cost blowouts.

“It’s the best estimate, I’m not here to say to you anything is locked in stone here when it comes to a project like this,” he told News24.

“I believe this $22.5bn with a buffer up to $25bn which is contingenent and sensible for such a big project is the best possible estimate.”

“This project will last 150 years — well after you and I have sadly departed the scene. When our grandkids and great-grandkids are relying on energy, this Snowy 2.0 will still be working. It’s got a very long life.”

Shadow Energy Minister Dan Tehan and Coalition colleagues have called for Mr Bowen to resign over the cost blowouts.

“Chris Bowen must release the Snowy 2.0 cost report, in full, immediately,” Mr Tehan said.

“Chris Bowen has overseen a massive budget blowout. He should be up front with Australians about exactly where he’s gone wrong, apologise to Australian taxpayers for his latest mess and resign.

“Heaven only knows what the Auditor General would make of this latest mess.”

Opposition leader Angus Taylor also attacked Mr Bowen over the blow out.

“Everything that bloke touches turns to custard,” he told reporters in Perth on Friday.

“This is the guy wandering around the world on his net zero tour. Has his snooze fest in the South Pacific? He can’t even stay awake for it. I mean, seriously, he’s not up to the job.”

Mr Bowen labelled claimed the original decisions around the costings of the project, which was announced under former Liberal Prime Minister Malcolm Turnbull, were “made very immaturely”.

“We know that the original decisions were made very immaturely. By that, I mean the design was immature when the previous government committed to the project,” Mr Bowen claimed.

“Hardly any technical work had been done. Not enough soil testing had been done.”

Industry Minister Tim Ayres also backed in Mr Bowen, claiming Labor was delivering the project in the “the most effective way”.

“The problem with this project is that it was designed by Barnaby Joyce and Malcolm Turnbull and Scott Morrison in a hurry, in a rush to get an announcement out the door,” he claimed.

“No engineering was done over the period of the Morrison and Turnbull governments to make sure that there were proper costings, no proper costings delivered.

“This project has been a very difficult project because it was founded in a set of cheap and too quick decision-making in order to get an announcement out the door.

“It’s fallen to Minister Bowen and the Albanese Government to deliver it.

“It’s an important project for our energy security. We’re going to get on with the job, but it’s founded on some pretty bad starts.”

Snowy Hydro chief executive Dennis Barnes, who benefited from a $2 million remuneration package in the 2024-25 financial year to be one of Australia’s highest-paid government executives, said the cost could have been even higher if it weren’t for a move away from a fixed-price contract in 2023.

“I have no doubt that moving from a fixed price contract, which was never suitable for such scale, uniqueness and complexity, has protected the project from an even greater cost increase,” he said.

“It’s also likely that under a fixed price contract, the project would again be stopped under the weight of billions of dollars of claims from the contractor, as it was prior to the reset.”

Just three years ago, the Snowy Hydro 2.0 cost estimate was put at $12 billion, with first power in the second half of 2027 and a target date for commercial operation of all units by December 2028.

Mr Barnes said that by 2050, more than half of Australia’s total energy grid storage would come from Snowy 2.0, providing 350,000 megawatt hours of storage that was equivalent to 26 million home batteries.

“Like the original Snowy Scheme, which still underpins energy reliability more than 70 years on, Snowy 2.0 is a generational investment in our energy sovereignty and a national asset owned by all Australians,” he said.

The construction has been beset with engineering and commercial obstacles.

A 143-metre tunnel boring machine became stuck in hard rock in 2024 after previously being bogged in soft ground in Kosciuszko National Park in 2022.

Perth-based construction and engineering group Clough went into receivership in late 2022, just three years after costs blew out to $5 billion.

Emergency Management Minister Kristy McBain also dismissed concerns around cost blowouts — telling Radio National on Friday there was “no doubt” the project was necessary.

“We want to see it complete. We know that we need more energy in the grid,” she told Radio National.

“The initial announcement — whilst it was undercooked and not planned properly — was the right thing in terms of getting dispatchable energy into the grid.

“I think we’ve been really clear that Snowy Hydro has a responsibility to continue to inform the government of what’s going on.

“But they are also a company in their own right, and they’ve got to make sure that they understand their own cost structure.

“I think now that the project is 65 per cent complete, we need this project completed because we need it to be dispatching energy to the grid.”