The NSW government says it won’t go ahead with plans to raise the Wyangala Dam near Cowra because the project isn’t financially viable and will have potentially catastrophic environmental consequences.
Water Minister Rose Jackson says the final business case for the project, as well as an independent review by Infrastructure NSW, conclude that the project, which has cost the state $74 million so far, doesn’t stack up.
DPIE says the costs of construction, originally estimated at $650 million, would come to billions of dollars.
The Final Business Case says the project is unlikely to gain planning approval and is financially unviable.
“As such, this Final Business Case concluded the Wyangala Dam Wall Raising project is not viable and should not proceed,” it says.
Meanwhile, Infrastructure NSW’s State Infrastructure Strategy 2022-2042 calls on the government to reconsider the timing and sequence of a number of major projects, including the Wyangala Dam upgrade.
Water security concerns
The Wyangala proposal was announced in 2019 as part of a jointly funded $1 billion plan to deliver new or upgraded dams in NSW.
At the time, the government said it was necessary to secure water supply and provide flood mitigation in the Lachlan Valley.
The plan involved raising the Wyangala Dam wall by ten metres, increasing storage capacity by 53 per cent. Construction was expected to take four years.
Ms Jackson said while it’s feasible to raise the wall, it could cause irreversible environmental damage. The costs of doing the work also outweighed the benefits, she said.
Hydrological modelling carried out for the final business case showed the project was likely to have “devasting impacts on the internationally significant downstream environment, resulting in excessive biodiversity offset costs,” the minister said.
“The other major issue is the billions of dollars to build the dam wall … in this case, the capital costs are too high, and the benefits are too low.”
The Greens have argued the plans were originally announced ahead of a state election without evidential basis or economic rationale.
Residents abandoned, council says
However, Cowra Shire Council said the decision had left residents high and dry.
Mayor Bill West said the decision was disappionting, but not surprising.
“How can $4 billion be spent on light rail in the city, but money can’t be allocated for essential food and water security and flood mitigation in the Central West of NSW, which is crucial for regional growth and development,” he said.
He said the business case study suggested the cost of the Wyangala Dam expansion outweighed the anticipated benefits, but it also acknowledged the region will continue to grow.
“If expansion and growth continue as the case study says it will, then perhaps it won’t outweigh the benefits,” Cr West said.
“In the coming days and weeks we will go through the details of the released documentation to fully understand the reasoning but we don’t accept the price tag is too great.”
The government says it recognises the need for drought-preparedness in the region and will seek feedback on a draft Lachlan Regional Water Strategy which will go on exhibition before the end of the month.
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