On a chilly morning near the old township of Adaminaby on 17 October, 1949, a small gathering of dignitaries stood in the gusting wind, and launched Australia onto one of its greatest adventures-the Snowy Mountains Hydro-Electric Scheme.
Surrounded by fluttering Union Jacks and a brass band bussed in for the national anthem, 'God save the King', the Prime Minister, Ben Chifley, his Minister for Works, Nelson Lemmon, and the Snowy authority's first commissioner, William Hudson, pitched Australia into a revolution.
The country was agricultural and stoically British. The Snowy Scheme drove it to the forefront of construction and engineering technology and created one of the world's great pancultures; a nation reshaped and enriched by the influences of almost every nationality on the planet.
By the time the Scheme was completed in 1974, the major contractors had changed from British, American and Norwegian, to Australian; the equipment was mostly Japanese, Australian expertise was now being sought elsewhere in the world, and Australians were cooking with garlic and eating spaghetti, salami, rice and other previously 'foreign' foods. The revolution was complete-for the moment.
The Snowy Scheme harnessed Alpine water, redirected it westwards to turn an inland dustbowl into a foodbowl, and in the course of the water's fall down the western slopes of the Australian Alps generated hydro-electricity for Sydney, Canberra and Melbourne. Half a century later, that foodbowl produces a third of Australia's agricultural output, and Snowy hydro-electricity has become vital to the economics and environmental sustainability of electricity generation in eastern Australia.
In its first 30 years the Snowy Scheme operated smoothly, slipping from public consciousness. However, by the 1980s, as the community started becoming aware of irrigation-induced salinity, and the deteriorating condition of Australia's rivers the Snowy Scheme became, for some, the whipping boy.
It had also become a milch cow for State electricity authorities. Whatever it cost to run the Scheme (about $150 million a year) was what NSW, Victoria and the Commonwealth (for the ACT) paid for the electricity. Consequently during the climate of economic rationalism in the 1980s the state utilities strove to get their electricity at the cheapest possible cost--irrespective of any long-term impact on the Scheme. The Snowy Authority's workforce was slashed by almost two-thirds, and infrastructure investment languished.
By the late 1980s, a worried federal treasurer, Paul Keating, decided the Scheme should be corporatised and taken from direct government management. In 1993 the States, surprisingly, agreed, although to simplify the process, water issues were side-stepped so they could concentrate on the electricity assets and their role in the new deregulated market.
However, when the corporatisation bills reached the Senate in Canberra and the Upper House in NSW, the water interests rebelled, pushing the whole electricity agenda aside. The environmental movement in particular, regarded Snowy corporatisation as a rare chance to secure water reform because the Snowy Scheme regulated flows into the degraded River Murray, and the Murrumbidgee and Snowy rivers.
In an instant, the governments were confronted with the seemingly impossible demand of balancing the needs of the irrigation industries in the west and the demands of an environmental lobby calling for increased flows to the Snowy River.
Corporatisation was dead in the water--literally--unless these conflicting demands could be resolved.
The corporatisation team became sidelined as the debate swung to the condition of the Snowy River. The senior Victorian government official on the corporatisation team, David Downie, voiced a widely shared view in government circles on the way the issue unfolded in the media: "It was an appalling debate, given the Snowy River was one of the better managed rivers in Australia and by comparison to most others, healthy. At its mouth it had 50 to 60 per cent of natural flow, compared to the poor River Murray which had about 20 per cent. Only the upper 40 kilometres of the Snowy are affected by the Scheme. Below this the river's tributaries are unimpeded."
However, the public and the media accepted the claim that only one per cent of the Snowy River's natural flow still existed. It's true-but only at the very foot of the Jindabyne Dam wall. By comparison, the Murray was in extreme trouble. However arguments of rationality were being drowned by the politics of perception.
It became very hard for any rational debate to withstand the emotion generated by horseback riders in Akubras and Drizabones declaring to television cameras, 'the Snowy must flow again'.
The campaign would eventually have a dramatic political outcome resulting in a change of government in Victoria and some $300 million being directed to addressing the environmental problems afflicting the top 40 kilometres of the Snowy River--while the waterway that was really sick, the 2560 kilometre-long Murray, was allocated a mere $75 million.
Nonetheless, the debate brought into sharp relief the whole issue of limited water resources and the clear message that existing water management is not sustainable.
The Snowy environmental lobbies and the Murray/Murrumbidgee economic lobbies met head on, with the Snowy Scheme caught in the middle; a great water bank that all the competing interests wanted to use for their own particular problems--in addition to the water's prime function to generate clean, renewable energy.
In 1997, the Commonwealth was forced to promise an Environmental Impact Statement of the Snowy Scheme, and the NSW Government similarly only secured passage of its Bill through its Upper House by promising to hold a water inquiry in conjunction with the Victorian Government.
The inquiry was run by a retired NSW National Party politician, Robert Webster, who summed up his task as a clash of three Australian icons--the Snowy River, the Snowy Mountains Hydro-Electric Scheme, and the Murray and Murrumbidgee irrigation areas.
The inquiry lasted almost a year and attracted unprecedented public participation. Webster felt it set a new benchmark for future public inquiries, and scientific and economic studies into water allocation and river system management both in Australia and internationally.
As the various issues and competing demands were raised and ideas aired, sophisticated computer models were developed to simulate the impact the most likely options would have on electricity generation, river systems and agriculture. The inquiry also investigated the 'bigger picture' trade-offs such as the increase in Greenhouse gas emissions resulting from less hydro-electricity if the Scheme's water reserves were reduced. The Snowy Scheme offsets five million tonnes of greenhouse gas emissions a year, which is considered crucial if Australia is to meet even some of the international obligations.
Then the former Commonwealth Department of Industry, Science and Resources began the Environmental Impact Statement required by the Senate. The EIS collected all relevant information on the possible consequences of the Scheme's corporatisation-for the Kosciusko National Park, the national electricity market, and water security for towns, irrigated agriculture, electricity generation, and riverine systems.
In October 1998 the water inquiry reported, with a recommendation to try and return 21 per cent of natural flow back into the top end of the Snowy River through 'efficiency savings' in the water supply infrastructure. This meant replacing open irrigation supply channels with pipelines and pursuing more efficient water use generally.
Among the environment and water industry groups, reaction was mixed.
Graeme Enders, regional coordinator for Snowy River Recovery activities for the NSW Government, felt the Snowy-flows debate had at least settled the question of the environment being a legitimate water user and that its needs had to be met the same as commercial needs had hitherto been met:
"It also showed politicians that the Australian public knew water resources in south-eastern Australia had been over-allocated and not well-managed; salinity being just one environmental cost. The increased water flow wasn't as much as some had hoped for, but water was never going to be the only outcome from the process we went through. There is a lot of work now to be done on river programs such as controlling willow trees."
Enders also believed the fact a river was being recovered at all, possibly for the first time in Australia's history, meant a lot was going to be learned for the benefit of the future: "The day that first flow is released will be a moment of powerful symbolism; real acknowledgment of a change in community attitude towards the environment's needs."
Other river campaigners, however, remained sceptical. Carl Drury, a Jindabyne resident who had been a leading campaigner for increased Snowy River flows for many years didn't believe an environmental flow had been achieved at all, but rather a political flow.
Drury, a white-water rafting enthusiast believed governments had failed to acknowledge the benefits to local economies of such eco-tourism attractions. He felt that at least 44 per cent of average natural flows should have been returned to the river, and that this should have been done first, to force irrigation efficiencies.
With the water debate partially settled, the process of corporatising the SMHEA was able to resume, and it became much more than a name change. To become Snowy Hydro, the old organisation had to completely reinvent itself--new operating systems and priorities, new technologies and a new workplace culture.
The person appointed to oversee this was the SMHEA's last commissioner, and Snowy Hydro's first CEO, Terry Charlton, who arrived during the 50th anniversary celebrations in 1999.
Charlton and his new team began vigorously promoting their belief that corporatisation was a new beginning for the Snowy Scheme--a change that would protect the Snowy vision and carry it into the 21st century.
When this became reality on 28 June 2002, corporatisation meant the transformation of an operation that had previously only had to worry about releasing a certain amount of water and generating a certain amount of electricity, to a modern high-technology business dealing in complex, derivative energy and water products--such as insurance contracts to cover other generators' outages, or to generate extra electricity on-call to prevent price jumps in the new, deregulated and real-time electricity market.
For example, if sudden increases in demand start pushing up the spot price, energy retailers can call on their Snowy contracts to have extra electricity generated into the grid to offset the demand pressures.
So today, the Snowy is no longer a Scheme generating electricity, but a business with electricity products.
During the last decade of the twentieth century and the start of the twenty-first, the Snowy Scheme in many ways re-lived its birth-pains of the early 1950s. Its political future was uncertain, and governments still couldn't decide what to do with the water once it left the power stations.
Nonetheless the Scheme lived up to its iconic status, and the debates, issues, frustrations and despair during the decade-long corporatisation process was in many ways a 'right of passage' for Australia as it entered the new millennium.
The old Snowy was a triumph of physical and engineering prowess; the new Snowy might become a monument to a nation finally able to face-up to some of the most complex and confronting economic and environmental issues facing any country.
Time has yet to tell, but many of those involved in the drawn-out corporatisation process were left with a sense of history having been made--that they had changed the way in which governments, and their departments, agencies and constituents deal with each other from here on.
To corporatise the Snowy, people had to leave their ideological trenches, bureaucrats had to surrender empires, river communities with diametrically opposed demands had to acknowledge each other's rights.
The future holds enormous challenges as the world's fresh water reserves continue to dwindle, as arable land disappears beneath urban growth, as the atmosphere becomes less able to absorb the chemical emissions of traditional forms of energy production and consumption. It could be frightening, except Australia has this extraordinary resource--the Snowy Mountains Scheme.
