One of Australia’s leading energy policy analysts has blown a massive hole in the costing of Labor’s flawed, dangerous policy to build a $1.2 billion state-owned hydrogen power plant funded entirely at taxpayers’ expense.
Labor Leader Peter Malinauskas’ credibility is in shreds after Tony Wood, of the Grattan Institute, found the cost for liquification and storage of hydrogen in Labor’s plan would be ‘in the low hundreds of millions of dollars’ – not the $31 million Labor has budgeted.
“… just making a number up ($31 million) does not seem like a good idea,” Mr Wood told The Advertiser.
It comes as independent credit rating agency S&P has issued a stark warning to state and territory governments to stop spending and warned that credit ratings would be at risk if spending continued at ‘pandemic stimulus’ spending levels.
Credit ratings are directly linked to interest costs on repaying state debt.
“Mr Malinauskas’ shocking costings error with his $1.2 billion experimental hydrogen power plant, as exposed by the respected Grattan Institute, highlights the enormous risk of electing a Labor Government on Saturday,” Treasurer Rob Lucas said.
“Mr Malinauskas’ shocking error explains why almost a year after releasing his experimental hydrogen plant plan, he continues to hide the detailed modelling and costings it is based on.
“It also explains why Mr Malinauskas gagged Frontier Economics from publicly discussing how the original, hopelessly under-budget $593 million price tag was arrived at.”
Mr Lucas said while Labor claims the cost of the hydrogen power plant is $593 million, the real cost will blowout to $1.2 billion – and by Mr Malinauskas’ own admission it won’t even deliver cheaper power.
“Only Mr Malinauskas would spend hundreds of millions of taxpayer dollars on a power plant when it won’t reduce power prices for struggling South Australian families,” Mr Lucas said.
It comes as S&P credit rating analyst Martin Foo issued a stark warning to state and territory governments to stop spending.
“Federal and State governments rolled out a series of massive support packages to help keep businesses and households afloat,” said Mr Foo.
Mr Foo went on to warn that S&P would closely monitor whether COVID-19 crisis budgets would be prolonged and rebranded as election budgets.
“This is exactly what Mr Malinauskas and Labor are promising with their reckless and unfunded $3 billion in election promises,” Mr Lucas said.