The Queensland Government has identified the 750MW Capricornia Pumped Hydro Project as the preferred project to progress to the next stage of negotiations following a state-wide assessment of pumped hydro opportunities undertaken by QIC.
The decision, confirmed in the 2026-27 State Budget, positions the project as part of the state’s strategy to increase long-duration energy storage and support electricity system reliability as renewable generation grows.
Located about 80km west of Mackay in Central Queensland, Capricornia Pumped Hydro is planned to provide 12GWh of storage capacity, equivalent to around 16 hours of storage, alongside 750MW of dispatchable generation capacity.
Project developer Capricornia Pumped Hydro said the scheme would be funded through private investment rather than direct taxpayer funding and is expected to create around 650 construction jobs and 65 operational roles.
Project CEO John Carr said: “As Queensland’s population and industry grow, we need energy infrastructure that not only meets demand but strengthens resilience when the system is under pressure.
“This isn’t about replacing what we have. It’s about strengthening it,” he said. “The Capricornia Pumped Hydro Project will provide large-scale energy storage and fast-response backup capacity for Queensland’s electricity network, supporting the grid during peak demand, generator outages and maintenance periods.”
The announcement comes alongside a broader package of water and energy infrastructure measures contained in the Queensland Government’s 2026-27 Budget.
The state has allocated funding for capacity-restoring upgrades at Lake MacDonald Dam and North Pine Dam, which it said would provide additional storage equivalent to constructing a new dam. The Budget also includes support for new weirs on the Thomson River near Longreach, the Boyne River near Mundubbera and Baraambah Creek near Murgon.
Funding has also been allocated to continue planning for the reconstruction of Paradise Dam and to progress projects including the Water for Warrill Irrigation project, the Lockyer Valley and Somerset Water Security Scheme and Emu Swamp Dam.
The Budget includes A$195.6 million to support water infrastructure upgrades in regional and remote communities, alongside measures aimed at reducing water costs, including a two-year freeze on bulk water prices for South East Queensland residents and subsidies for water charges in the Cloncurry and Gladstone regions.
Queensland Minister for Local Government and Water Ann Leahy said: “This Budget continues to deliver on our key election commitments by boosting water availability and security right across Queensland through our Watertight Water Security Plan.
“Progressing Paradise Dam and key projects across the State will help secure reliable water supply for communities, industry and primary producers well into the future.”
