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Marinus, Kerang Links fast-tracked from $20B fund
The Federal Government has committed to conditional funding for major renewable and transmission projects – including the Marinus and Kerang links – from its $20 billion Rewiring the Nation plan.
The new commitments include a $75 million investment to fast-track the Marinus Link project, a $1.5 billion loan for Victorian Renewable Energy Zones (REZ), and a $750 million concessional loan for the Victoria-New South Wales Interconnector (VNI West) KerangLink.
Prime Minister, Anthony Albanese, said the conditional funding would strengthen investment and growth in Australia’s future energy grid.
“Rewiring the Nation has always been about jobs in new energy industries, delivering cleaner, cheaper and more secure energy, and bringing down emissions – today it begins doing just that,” Prime Minister Albanese said.
“An electricity grid built for the 21st century is absolutely critical, but until the election in May there was no plan to deliver, let alone to do so at lowest cost for consumers.”
The significant investment in transmission infrastructure has been celebrated by Energy Networks Australia CEO, Andrew Dillon, who said the project would deliver more secure and reliable access to renewable energy sources.
“Australia is working towards a net zero energy grid but is hampered by a lack of transmission infrastructure. These new links are key steps towards a 21st Century renewable energy grid,’’ Mr Dillon said.
“Network investment is critical to enable the most affordable transition to a net zero energy system.
Kerang Link and Victorian REZs
The Federal Government has agreed to fast-track Victorian REZs and offshore wind development with $1.5 billion of concessional funding for REZs and offshore wind projects.
In addition, a concessional loan of $750 million will be allocated toward the VNI West KerangLink.
Promising 4,000MW of new power generation VNI-West KerangLink will support more than 2,000 direct jobs during construction and generate $1.8 billion in net market benefits.
Victorian Premier, Daniel Andrews, said the investment acknowledged Victoria’s nation-leading emissions reduction efforts.
“Victoria has cut emissions by more than any other state, tripled the amount of renewable energy and created thousands of jobs. We’re not just talking about climate action – we’re getting on with it.”
“All of this means more jobs, cleaner energy and cheaper power bills for Victorians.”
Marinus Link
The Federal Government has committed $75 million from its Rewiring the Nation plan, and signed a partnership with the Tasmanian Government to jointly fund the ambitious Marinus Link project.
Construction will see more than 255km of undersea transmission cable delivering renewable energy generation and storage for the mainland through Tasmania’s Battery of the Nation projects.
The project comprises two under-sea transmission cables connecting Tasmania and Victoria, promising 1,400 jobs in Tasmania during peak construction, 1,400 jobs in Victoria, and up to $4.5 billion in positive net market benefits, including to electricity users.
The partnership will supercharge investment in Battery of the Nation, which is expected to deliver up to 670 direct jobs across Tasmania in a letter of intent that includes: » Access to a concessional loan from
Rewiring the Nation, through the
Clean Energy Finance Corporation for approximately 80 per cent of the project costs of Marinus Link, with the additional 20 per cent to be an equity investment shared equally between the Commonwealth, Victoria and
Tasmania to the critical project off the ground » Up to $1 billion of low-cost debt from
Rewiring the Nation for Tasmania’s
Battery of the Nation projects, including Tarraleah Power Station redevelopment and Lake Cethana
Pumped Hydro » Low-cost debt to link Cressy, Burnie,
Sheffield, Staverton and Hampshire in
Tasmania, known as the North West
Transmission Developments (NWTD), which will increase the capacity of the network in Tasmania
The joint-commitment has been welcomed by Marinus Link’s major stakeholders, including Hydro Tasmania and the Marinus Link organisation.
Marinus Link CEO, Bess Clark, said at 1500MW, Marinus Link has about three times the capacity of the existing Basslink interconnector, and equivalent capacity to the former Hazelwood power station in Victoria, able to supply over 1.5 million Australian homes with electricity.
“The project has been identified by the market operator as urgently required and this announcement provides the commercial framework to see the project progress through to operation,” Ms Clark said.
“Marinus Link will ensure long-term energy security and provide Tasmanians with a stronger, more resilient grid. Marinus Link will allow Tasmania’s capacity-rich hydro generation to be better utilised, alongside new wind and solar energy.”
Hydro Tasmania CEO, Ian Brooksbank, said his organisation welcomed the new commitment, which will harness Tasmania’s abundant natural resources.
“Hydro Tasmania welcomes the
announcement of a new partnership between the Tasmanian and Federal Government to back progressing Tasmania’s renewable energy ambitions through Marinus Link and Battery of the Nation,” a Hydro Tasmania spokesperson said.
Marinus Link involves approximately 255km of undersea High Voltage Direct Current (HVDC) cable and approximately 90km of underground HVDC cable.
It will also include converter stations in Tasmania and Victoria, and approximately 240km of supporting High Voltage Alternating Current (HVAC) transmission in North West Tasmania, known as the North West Transmission Developments.
The Clean Energy Council (CEC) said the announcement that the Federal Government has reached agreements with the Victorian and Tasmanian Governments to proceed with a range of critical transmission projects will unlock massive investment in renewable energy and is a game-changer for Australia’s clean energy transition.
CEC CEO, Kane Thornton, said 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”.
“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,” Mr Thornton said.
“Marinus Link will allow Tasmania to export its considerable pumped hydro and wind energy resources to the National Electricity Market and open up further investment opportunities in renewables. Support for renewable energy zones and offshore wind projects is also a smart investment in the energy infrastructure necessary for the 21st century.”
Mr Thornton said CEC knows that clean, low-cost renewable energy and storage is the answer to Australia’s energy supply concerns.
“Speeding up investment is critical to lowering energy prices, ensuring a reliable grid and unlocking an enormous amount of renewable energy investment,” Mr Thornton said.
“This is the sort of political leadership and tangible action investors have been calling for to ensure we have a smart, modern and 21st-century electricity grid.
“[The] announcement shows how quickly we can make progress on the energy transition when governments across the country are working together.”
The CEC will continue to advocate for reform to the energy market and regulatory tests for new network investment, as well as a renewable energy storage target. Combining wind and solar with storage like batteries, hydro and pumped hydro, and the transmission needed to move clean energy around the country, will ensure every Australian has access to clean, affordable and reliable energy.
Confidence and certainty for Hydro Tasmania
Hydro Tasmania CEO, Ian Brooksbank, welcomed the strong government support for the partnership between the Tasmanian and Federal Government.
Mr Brooksbank said that the announcement of low-cost financing through the Rewiring the Nation plan provided confidence and certainty to Hydro Tasmania for its Battery of the Nation vision to maximise Tasmania’s existing hydropower capacity and add pumped hydro.
“Marinus Link will open up even greater two-way market access, stimulating renewable energy investment in Tasmania including our hydropower projects,” Mr Brooksbank said.
“Battery of the Nation will bring an additional 1500 MW of on-demand capacity into the national market – that means it’s available at the ‘flick of the switch’.
“The first 750MW Marinus Link cable will unlock flexibility in our existing hydropower system to provide the on-demand backup needed. It also opens up potential for capacity upgrades in our assets including the Tarraleah scheme and the West Coast stations.
“The second 750MW cable creates the opportunity to develop pumped hydro – a 750MW, 20-hour, cost-competitive, long-duration storage opportunity at Lake Cethana.”
With more interconnection, new wind projects and increased hydropower capacity, Tasmania will produce more than enough renewable energy to power Tasmanian homes, businesses, and industries plus it can export the extra power to support a clean energy future for Australia.
“Benefits will flow back to Tasmania through access to affordable power, economic investment, creation of much needed jobs, attraction of new business, and increased profitability for Hydro Tasmania which brings revenue to the State Government to support vital infrastructure and services,” Mr Brooksbank said.
“Tasmanians can be proud that we are doing our bit to address climate change, while also reaping the benefits of lower power prices, greater economic returns to the state, and the jobs and investment that will help grow our economy for the future.”
