Government invests in business case for a second Tasmanian interconnector

Media release
24 Nov 2017
Prime Minister, Minister for the Environment and Energy

The Turnbull and Hodgman Governments will invest up to $20 million for a business case study for a second Tasmanian interconnector, a project that would cement Tasmania’s position as the battery of the nation and improve the reliability and affordability of the National Electricity Market.

This announcement builds on the extensive work of the Tamblyn Review and ‘Battery of the Nation’ feasibility studies announced by the Prime Minister in April 2017.

Preliminary findings from this work by Hydro Tasmania indicate a second interconnector could enable Tasmania to expand its wind and hydro capabilities and add more power to the national grid, with a net benefit of $500 million.

As the next step, a business case study would examine and finalise the preferred route, optimum size, cost estimate, revenue investment test and financial model for a second interconnector between Tasmania and Victoria.

TasNetworks, as the proponent, are working with the Australian Renewable Energy Agency (ARENA) to develop a proposal for formal assessment. If successful, the business case would be jointly funded by the Commonwealth and Tasmanian Governments at an expected cost of around $20 million.

This is the next step in tapping the potential of Tasmania to expand its substantial renewable energy base and provide even more affordable, reliable energy to the national grid.

The Turnbull Government is already investing in Tasmanian projects such as a feasibility study into 2500MW of pumped hydro storage at 13 different sites, a University of Tasmania stocktake of the country’s tidal energy resources and a smart grid project on Bruny Island.

These measures complement the Turnbull Government’s program of delivering more storage and dispatchable renewable energy across Australia. We are expanding Australia’s hydropower resources with Snowy Hydro 2.0 and additional pumped hydro projects in Queensland, South Australia and Tasmania.