The project was expected to cost around $300 million and would have created more than 350 jobs during its construction.

Some geotechnical work commenced on the project in June 2019 and since then a feasibility assessment was conducted by Origin which found the project was not commercially viable for the company.

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"With the support of the Australian Renewable Energy Agency (ARENA), Origin recently completed a feasibility study on the expansion of our Shoalhaven pumped hydro storage scheme," an Origin spokesperson said.

"This study determined that while the addition of a 235 MW unit is technically feasible, it is not commercially feasible in the current economic and regulatory environment.

"Origin will continue to consider this expansion project for our portfolio in the future."

In 2018 the Australian Renewable Energy Agency (ARENA) committed $2 million in funding for Origin to assess the feasibility of expanding the Shoalhaven Pumped Hydro Scheme, the NSW government then declared the project Critical State Significant Infrastructure.

The proposed upgrade would have seen a new hydroelectric power and pump station being constructed, mostly underground, and located between Fitzroy Falls Reservoir and Lake Yarrunga.

The existing hydro pump scheme in the Shoalhaven has a generation capacity of 240MW, the upgrade would have seen the scheme generate 475MW. In comparison the Snowy Hydro scheme generates 5500MW.

The current scheme consists of two pumped storage hydropower stations at Kangaroo Valley and Bendeela. Water used to generate electricity during peak demand periods is pumped back, during lower demand periods, to storage headponds above each station ready for when power generation is next required.

The same system is also used to pump water to Sydney when there is a drought.