Contested HumeLink transmission line gets federal green tick to connect Snowy 2.0 to the grid

Transgrid’s massive HumeLink transmission line, considered crucial to the connection of the Snowy Hydro 2.0 pumped hydro project in southern New South Wales, has been given the federal green tick, clearing its last hurdle to development.

The contentious $4.8 billion project, which will involve 365km of new 500 kilovolt high-voltage transmission lines between Wagga Wagga, Bannaby and Maragle, was given the all-clear by federal environment minister Tanya Plibersek on Thursday.

Plibersek says the approval of HumeLink, which is expected to unlock an extra 3 gigawatts (GW) of renewable energy in southern NSW, is subject to strict conditions, including limits on land clearing and directions to minimise impacts of hollow-bearing trees and threatened species.

Plans for the major new overhead transmission have drawn criticism and opposition from farmers, local communities, environment groups and energy experts, including for its cost, which has blown out from early estimates of around $1 billion.

Who pays these costs is another bone of contention. Critics, like Australian energy market veteran Ted Woodley, have argued that it should be the project’s main beneficiaries, including Snowy 2.0 and other renewables developers, who foot the $4.8 billion bill, and not NSW consumers.

Critics have also argued that, despite its exorbitant price tag, HumeLink is undersized and will not be able to accommodate the combined capacity of Snowy 2.0, up to 3GW of future southwest-NSW wind and solar farms, as well as interstate transfers with Victoria and South Australia.

But the main concerns with HumeLink have centred on the project’s environmental and community impacts. In particular, the battle for grassroots support and refusal of underground wires through prime farmland and Kosciuszko National Park has been closely watched.

Transgrid had estimated a subterranean line would cost up to $11.5 billion and would take too long.

In a statement on Thursday, Plibersek said the project’s new overhead lines will be within existing transmission corridors, to minimise clearing. But Woodley argues that HumeLink has no social licence from local communities, and will require clearing along its full 365km, as well as for access tracks.

“The enormity of HumeLink’s environmental impacts is indicated by its 9000 hectare construction corridor stretching 365 kilometres and the $0.5bn bank guarantee required from TransGrid to ensure biodiversity offsets are implemented.

“We have ended up with ‘one of the largest transmission projects in the state’s history’ that is exorbitantly expensive, has negative net benefits, is to be paid for entirely by electricity consumers, causes unprecedented social and environmental impacts, and is undersized,” Woodley says.

Plibersek says HumeLink will create 1,600 construction jobs and put downward pressure on electricity prices by adding 2200MW of “on-demand energy” into the grid, at a time when NSW is racing to replace its ageing and polluting coal plants.

Transgrid says construction of HumeLink will start early in the new year, following the securing of all approvals and the Final Investment Decision
(FID) by Transgrid’s Board to invest in the $4.89bn project.

Transgrid Group CEO Brett Redman said on Thursday that Transgrid security holders had agreed to invest $1.5 billion to the critically important infrastructure, following their $690 million investment to support the delivery of VNI West earlier this year.

The Clean Energy Finance Corporation is also backing the project with around $450 million in concessional-loan financing for HumeLink and an additional $1 billion support via subordinated notes.

This is in addition to CEFC funding of $140 million to Transgrid’s other major transmission project – the VNI West interconnector project (NSW).

For the CEFC, this $1.92 billion in concessional senior debt and subordinated notes marks the green bank’s single largest investment since its inception.

“HumeLink and VNI West are essential to the delivery of Australia’s energy transition, the Australian and NSW governments’ net zero targets and
providing consumers with access to more affordable renewable energy,” Redman said.

Redman also gave a nod to the landowners, communities, local contractors, business owners and other stakeholders Transgrid has worked with to get the project up.

“We will continue to prioritise local employment, training and skills development to provide lasting community benefits, including investing more than $11 million directly into the community to provide enduring social legacy outcomes,” he said.

With reporting from Luke Costin, AAP