The cost of building the first stage of Marinus Link has been revised down ever so slightly, with a $29.6 million reduction in construction costs helping to shave around $40 million off the roughly $5 billion bill, despite a small jump in insurance costs.
In an update to the July 2025 update on the Revised Revenue Proposal for the undersea cable project linking Tasmania and Victoria, Marinus Link Pty Ltd (MLPL) has reported a “modest reduction” of $39.2 million in its forecast capital expenditure for Stage 1 of the project.
The update, submitted to the Australian Energy Regulator (AER) on Monday, includes “further refined costs and unredacted figures,” which Marinus Link says shed fresh light on its accounting processes and further informs feedback for the AER’s consultation process.
“The modest reduction in our forecast capital expenditure in the attached update confirms the views expressed by MLPL’s executive team and Board that the information presented in our revised Revenue Proposal in July 2025 reflected the prudent and efficient costs of delivering Stage 1 of Marinus Link,” MLPL chief Stephanie McGregor says in a letter to the AER.
“There are no material changes to our expenditure forecasts from our July 2025 submission, and Marinus Link Stage 1 is on track to deliver significant benefits to consumers,” McGregor says.
The cost cut – which mounts to around 1% of the forecast total capital expenditure for the 2025-30 period – will do little to win over critics of the project.
The cost of Marinus Link, and its role as an enabler of major new renewable energy generation projects in Tasmania – like the recently EPBC-approved and highly contentious Robbins Island wind farm – have been major points of contention on the island state.
The project was first proposed as two cables with a combined capacity of 1500 megawatts (MW), but was cut in half in late 2023, in a deal between federal Labor and the Victoria and Tasmania state governments, in response to ballooning costs.
A 2023 EY report put the costs of the dual cable Marinus Link at $5.9 billion with a further $0.8 billion for the NWTD, between 2025 and 2030.
In July, Marinus Link and TasNetworks put costs for the contentious project to $3.89 billion for the now single 750 MW DC transmission link and telecommunications connector, and $1.14 billion for the supporting grid infrastructure or North West Transmission Developments (NWTD).
According to a project fact sheet published at the time, this put total costs around $230 million higher than the previous estimate, adding $30 million to the previously estimated cost of the undersea transmission line and $200 million to the cost of the associated onshore infrastructure.
Some analysts and environmentalists remain bitterly opposed, on both economic and environmental considerations, although it forms a key part of the federal government’s renewable plan, and the Australian Energy Market Operator’s planning blueprint, the Integrated System Plan.
MLPL says that since the July submission, updated cost estimates have been received for hedging cost, insurance cost and the Balance of Works tender, based on the final delivery phase offer (DPO) from the preferred bidder.
In early September, Marinus Link reached financial close off the back of a record commitment from the federal government’s green bank of up to $3.8 billion in concessional finance.
Financial close followed the early August Final Investment Decisions (FID) from the Tasmania, Victoria and federal Labor governments, which hold 17.7 per cent, 33.3 per cent and 49 per cent shares in Marinus Link, respectively.
FID was closely followed by federal environmental approval – a three-times delayed decision accompanied by “strict conditions” for the cable, related to listed threatened species and communities, listed migratory species and an approved Commonwealth marine area.
At around the same time, the Tasmanian Liberal government – which at the time was in caretaker mode – made public a similarly delayed Whole-of-State Business Case, revealing that Marinus Link would likely lead to some unpleasant cost hikes for major industry in the state.
In the October 17 letter to the AER accompanying the updated cost information, however, McGregor takes the opportunity “to highlight the importance of Marinus Link” as Australia transitions to net zero.
“Specifically, Marinus Link will provide substantial net benefits by optimising the use of Tasmania’s natural advantages in wind generation and deep storage capacity,” the letter says.
“Furthermore, these benefits are provided at discounted network prices to consumers as concessional finance and equity are expected to reduce MLPL’s revenue requirements by approximately 45% or $884 million ($nominal) in the 2030-35 regulatory period alone.
“We have worked hard to secure these concessional benefits for consumers,” McGregor says.
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