Transmission projects worth billions of dollars were “not being built for fun”, and were vital for modernising a grid requiring strengthening to cope with an expansion of renewables supply and rising power demand, Federal Climate Change and Energy Minister, Chris Bowen, said.
Addressing a vow by the Victorian Opposition last week that it would scrap the VNI-West project if it won office in November, Bowen told Renew Economy on Friday his government was “monitoring” the situation and how any changes might affect the grid.
“In the broad [view], new transmission is necessary not just to bring renewables on, just because of the … increase in electricity use across the country,” he said.
“The energy grid had been underinvested in for 50 years, in terms of transmission,” Bowen said. “We’re fixing that.”
He cited progress on the Hume Link, intended to connect the giant Snowy 2 pumped hydro project to the rest of the grid. Project Energy Connect linking NSW and South Australia, meanwhile, was “basically finished”.
“VNI West is important for Victoria and for the [National Electricity Market],” Bowen said, adding “obviously … we’ll await the results for the Victorian election, and we will deal with the situation after that.”
The NSW Opposition has similarly pledged to cancel a major transmission line and downgrade the country’s biggest renewable energy zone, in New England, should it win office in that state’s elections next March.
While polls rate such a change of government as less likely in NSW than Victoria, Bowen took a similar stance on any policy that would rip up existing plans.
“The transmission lines aren’t being built for fun,” he said, adding the enabling of more renewables to join the grid only part of the reason to proceed. “Obviously, renewables will fill the wires, but … we need new transmission regardless.”
This week’s release of the Electricity Statement of Opportunities (ESOO) by the Australian Energy Market Operator underscored the need for the contruction of new generation, storage and transmission to maintain grid reliability.
The report listed August 2029 as the operational start date for stage one of VNI-West, with November 2031 listed as the switch-on date for stage two. VNI-West is slated to increase the electricity transfer between Victoria to NSW of 1885 megawatts, and 1669MW between NSW and Victoria.
AEMO’s ESOO report also listed the New England Renewable Energy Zone Infrastructure Project, with its increase in network capacity of 6 gigawatts, as commencing from January 2034.
Separately, Bowen said he is yet to receive a delayed cost review of the Snowy scheme.
As Renew Economy’s Giles Parkinson reported earlier this month, the line-by-line review was announced last October by the federal government-owned Snowy Hydro when it flagged yet more cost overruns and potential delays.
“The situation remains, as I previously indicated,” the minister said on Friday. “It’ll be released after I’ve received it.”
Renew Economy contacted Snowy Hydro for comment.
AEMO’s ESOO report lists Snowy 2, with its 2.2GW/350GW-hours of capacity as commencing in December 2028, or about 28 months from now.
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