Tasmanian and Victorian consumers will foot the bill for the Basslink transmission cable as part of a new cost-sharing structure.
The Australian Energy Regulator (AER) approved $459.5 million in revenue recovery for Basslink between 2026–30, with costs split 75:25 between Tasmanian and Victorian consumers. Costs were previously recovered via a contract with Hydro Tasmania.
This will see an indicative annual bill increase of around $10 for Victorian residential consumers and $25 for Tasmanian residential consumers in 2026–27, followed by a $1 increase per year for Tasmanian consumers across the following three years.
AER chair Clare Savage said key issues raised by stakeholders had been carefully considered in the decision-making process.
“We have closely examined the value of the opening regulatory asset base and its capital and operating expenditure to ensure the revenue approved is prudent and efficient,” she said.
“When we approved the application to convert Basslink’s services to regulated transmission services, we considered its important role supporting energy security.
“The benefits of a regulated Basslink depend on its reliability. We have included adequate revenue in today’s final decision to support that reliability for energy consumers.”
Basslink was converted to a regulated transmission service in June 2025, with the AER determining the cable’s upside in promoting “efficient investment in, and efficient operation and use of, electricity services for the long-term interests of consumers”.
The 370km-long interconnector, which includes a 290km-long subsea power cable, connects the 220kV Tasmanian transmission network at the George Town substation with the 500kV Victorian transmission network at the Loy Yang substation.
The asset was energised in the National Electricity Market (NEM) in April 2006 after a two-year construction period between 2003 and 2005.
For AER’s revenue decision to apply, Basslink must be converted by owner APA Group from a market network service provider to a transmission network service provider with the Australian Energy Market Operator (AEMO).
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