The surprise, potential game-changer to the nation's electricity system, aims to increase the scheme's 4100 megawatt capacity by as much as 50 per cent.

The four-year project will massively increase the amount of renewable energy storage capacity in Australia through pumped hydro technology, which involves using cheap electricity to pump water uphill so it can be later released downhill through turbines, creating electricity when demand is high.

No new dams would be built, but a fresh series of tunnels and power stations are on the agenda, at an estimated cost of $1.5 to $2 billion.

The news has been greeted mostly with cautious praise, including local, Peter Lynch, who is managing director and founder of Pelena Energy.

Established in 1998, Pelena has been based in Dorrigo since 2006 and is NSW’s only hydroelectric turbine manufacturer.

“I am positive about Prime Minister Turnbull’s announcement this morning regarding proposed extensions to the Snowy Hydroelectric system,” Mr Lynch said.

“However, I have found the reporting of the announcement very confusing.

“I understand the proposal is to do two things.

“First, it is to increase the capacity of the Snowy Hydro to act as an energy storage asset in the existing electricity grid through changes to how much water is stored in the existing storage dams. This is generally referred to as ‘pumped hydro storage’.  

“Secondly, I understand the proposal is to increase the power capacity of the Snowy Hydro so that when there is a large demand for electrical power, such as hot days when lots of air-conditioners are turned on, then the hydros can be quickly started to supply the power demand.”

Mr Lynch also said another interesting outcome from today’s announcement was “the significant confusion and misinterpretation by various media outlets of the Prime Minister’s announcement”.  

“There have been a number of very confusing statements mixing up the units of energy (Watt-hours) and power (Watts),” hew said.  

“This might sound insignificant, but in the current debate about large-scale energy storage and new power generation technologies, knowing the difference is critical.  

“There is a real, practical difference and I urge all media outlets to get up to speed on the difference between energy and power because without such knowledge, the debate about Australia’s energy future will be particularly difficult.”  

In 2015 the NSW Government provided funding to the Dorrigo Chamber of Commerce to undertake a Run-of-River (RoR) hydroelectric assessment of the Dorrigo Plateau.

The results indicated substantial capacity to supply both the Plateau’s energy and power.   

“Run-of-River hydro differs to more traditional hydros, like the Snowy hydro, in that no dams are required,” Peter said.

“For RoR hydros, some of the water in a flowing stream is borrowed for a short time and diverted through a turbine to generate electricity, then returned to the river, unpolluted.  

“RoR hydros require the streams to flow to make them work. The reason most people in NSW live along a strip between the ocean and the Great Dividing Range is because it’s much wetter than west of the mountain range.  

“There is substantial historical flow rate data for many streams along the coastal strip, allowing significant opportunities for this new technology to be utilised with confidence about future outputs.  

“The other great benefit is that RoR hydro is 24/7, not like solar or wind which need regular storage.”

Mr Lynch said the other interesting reality is that 99.4 per cent of NSW’s present hydroelectric systems are on water supply dams whereby there is a conflict between those that want to store water for dry times (dam owners), and those with hydroelectric turbines (generators) that want to release the water to generate electricity.  

As such, for NSW, the demand for storage dams to supply the western, drier, regions coupled with the convenience of putting a hydroelectric system on a dam has resulted in 92 percent of NSW’s present hydroelectric generation being on the western, drier side, of the Great Dividing Range.

“Hardly any hydroelectric generation occurs on the wetter, eastern side where most of us live and where rainfall is greatest,” Peter said.

“The good news is that early next month the NSW Office of Environment and Heritage, with direct support from the Department of Premier and Cabinet, is holding a RoR hydro stakeholder meeting in Dorrigo to advance demonstration RoR hydros in NSW.  

“Government and industry representatives are coming together to work out a pathway through various regulatory factors.”

It is expected that a number of demonstration RoR hydros will be installed, feeding renewable electricity into the grid, as well as providing local jobs and industry opportunities.