The independent Board of Snowy Hydro Limited in Australia has approved a final investment decision to proceed with Snowy 2.0, subject to shareholder approval.

Snowy 2.0 is a pumped-storage hydro expansion of the existing Snowy Scheme, providing 2,000 MW of on-demand generation and 350,000 MWh of large-scale energy storage.

After almost two years of rigorous due diligence on every aspect of the project, including detailed financial analysis and ongoing geotechnical drilling, the board is confident Snowy 2.0 is a strong investment for the Company, a press release says.

The project will provide 175 hours of storage for the National Electricity Market, enough to ensure the stability and reliability of the system during prolonged weather events, such as wind or solar “droughts,” Snowy Hydro says.

The Snowy 2.0 plan has been a centerpiece of Australian Prime Minister Malcolm Turnbull’s plans to overhaul the country’s power sector. It is expected to cost $4.5 billion to develop.

The Snowy Mountains hydro scheme in southeast Australia was completed in 1974 and consists of 16 major dams, seven power stations, two pumping stations, and 225 km of tunnels, pipelines and aqueducts. The project produces electricity and supplies water to arid farming areas. The American Society of Civil Engineers rated this scheme as one of the civil engineering wonders of the modern world in 1967.

Snowy Hydro owns and operates about 5,500 MW of generation capacity, including the Snowy Mountains scheme.

Snowy Hydro says the board has informed the shareholder of its decision to proceed with Snowy 2.0 and further project information will be released after shareholder approval.