NSW approval for Snowy 2.0 main works

A major energy storage project has been given the green light by the NSW government, with construction of the Snowy 2.0 main works expected to create up to 2000 jobs.

NSW Deputy Premier John Barilaro on Thursday announced state planning approval for the project, which involves the construction of a 240-metre long pumped-hydro power station about 800 metres underground.

The state government says it will add 350 gigawatt hours of energy storage and 2000 megawatts of generation capacity to the state's grid - enough to power 500,000 homes during peak demand.

It follows the approval of the project's segment factory in March. The main works will now be referred to the federal government for final approval.

"Snowy Hydro is an icon of our community, with Snowy 2.0 already employing about 500 people, directly injecting more than $35 million into the Snowy Mountains and involving more than 100 local businesses," Mr Barilaro said in a statement.

"This latest approval will see the creation of an extra 2000 jobs during the construction phase, unlock billions of investment in regional NSW and allow the next stage of construction to further progress this legacy project."

Planning Minister Rob Stokes said the project's approval included strict conditions to minimise and offset environmental impacts.

"The project's approval also requires Snowy Hydro to invest almost $100 million for biodiversity and environmental offsets to protect threatened species and deliver long-term conservation and recreational benefits for the Kosciuszko National Park," Mr Stokes said.

The approval has been slammed by conservation group National Parks Association of NSW which argues it sets "appalling" environmental precedents.

Association executive officer Gary Dunnett is concerned the project will drive the critically-endangered stocky galaxies fish into extinction.

"The approval flies in the face of the fundamental principles of environmental planning, particularly the need to consider feasible alternatives and assess the cumulative impacts of all stages of a development," he said in a statement on Thursday.

"Today's decision will go down in history as an appalling assault on one of Australia's most fragile and precious of natural icons, Kosciuszko National Park."