Marinus Link gets nudge along as cost determinations begin

Plans to install a second undersea cable linking Tasmania’s majority hydropowered grid to the mainland via Victoria are set to progress, with the energy regulator kicking off a transmission determination process for the nearly $4 billion project.

The Australian Energy Regulator said on Thursday that the decision to start cost and revenue determinations on the 1500MW transmission link would pave the way for early works, allowing for better revealed costs and ongoing engagement with consumers and affected stakeholders.

The $3.8 billion line across the Bass Strait is one of the grid expansions identified as essential by the Australian Energy Market Operator in its Integrated System Plan, the 30-year blueprint that maps out the path to an initial 80 per cent of renewables by 2030.

The idea is that the new cable – which will be owned and operated by Marninus Link, a joint venture of the Tasmania, Victoria and federal governments – can export power from Tasmanian hydro, as well as from planned wind farms and pumped hydro, when it’s needed on the NEM.

But the project has faced criticism from environmental groups, including former Greens leaders Bob Brown and Christine Milne in Tasmania, and some energy analysts about its environmental impact value for money.

The project comprises two undersea High Voltage Direct Current cables running across the Bass Strait and converter stations in Tasmania and Victoria, as well as upgrades to the Tassie transmission network to accommodate the new link.

The AER says its assessments of the project will provide an estimate of the net benefits to consumers – that is the benefits from the project less the additional transmission costs.

Marinus Link got a major boost late last year from when federal Labor revealed it would use its $20 billion Rewiring the Nation program to support a range of critical transmission upgrades in Tasmania and Victoria – including the Marinus Link.

While many hailed the $2.25 billion deal between the federal, Victorian and Tasmanian governments as crucial to the delivery of enough solar and wind to replace coal, others were not so thrilled.

Former Greens leader and secretary of the board at the Bob Brown Foundation, Christine Milne told RenewEconomy she was “devastated” by the news of $1 billion in low cost finance from the Albanese government.

Milne argues that the power cable is being propped up by the various governments because it doesn’t stack up economically.

“It’s a terrible project, that will plunge Tasmania into debt, for virtually no benefit to Tasmanians,” she said in October.

On the other side of the fence, the Clean Energy Council argues that transmission projects like Marinus will unlock massive investment and serve as a game-changer for Australia’s clean energy transition.

“A smart, modern and strong transmission system is a crucial piece of the jigsaw puzzle to deliver a lower cost, more reliable and clean energy power system and transition Australia to become a clean energy superpower,” said CEC chief Kane Thornton on Wednesday.

“Australia is rapidly transitioning to a more flexible, low-cost, clean energy system and transmission projects – such as Marinus and KerangLink – and energy storage play a crucial role in Australia’s energy future.