Marinus Link’s first revenue proposal – which outlines how Marinus Link will ensure recovery of costs for early works on its proposed transmission project – has been released by the Australian Energy Regulator (AER) for public feedback.
The revenue proposal is a requirement under the National Electricity Rules.
Marinus Link CEO, Caroline Wykamp, said that the proposal ensures Marinus Link will be ready when the nation needs it most and reduces project risks.
“Marinus Link’s two-way transmission will give customers access to the lowest-cost energy and unlock hydro storage capability,” Ms Wykamp said.
“Importantly, until Marinus Link is commissioned, costs will not be recovered from consumers.”
The AER will commence a thorough review process and hold a public forum on the proposal, with revenue determination expected for 15 December 2023.
Marinus Link is expected to submit a second proposal to the AER for manufacturing, construction and commission expenditure in early 2024.
To see the proposal and make a submission, see the AER website here.
Government response
The first revenue Marius Link proposal for its transmission project has been updated, with changes including the concerns of material cost increases, putting extra financial burden on Tasmania.
State Premier, Jeremy Rockliff, said that the project will secure energy for its population but it must put the best interest of the state first, creating fair prices.
“For the right price, Marinus Link is an important project which will help boost additional renewable energy development in Tasmania and support growth in business and industry.
“The right price does not mean any price, and from day one we have said that the cost-benefits of this project must stack up in favour of Tasmanians.
“Under the Agreement we made with the Australian Government in October last year, we agreed to provide a third of the equity required for the project, based on the then $3.1 billion for Marinus Link,” Mr Rockliff said.
“The initial agreement for Marinus Link intended the project to be funded on the basis of 80 per cent debt finance and 20 per cent equity shared equally between the Commonwealth, Tasmania and Victoria.
“However, we have now been advised of material and significant cost increases for Marinus Link. This would mean a significant extra cost burden for Tasmania.
“I have asked the Prime Minister to consider alternative funding options for the increased costs of this project. Those discussions are continuing, and I am confident that we will reach a good outcome for Tasmania soon.”
State Minister for Energy and Renewables, Guy Barnett, said that the government would always put Tasmania first.
“We have always been clear that Tasmania would only pay its fair share of this project, which is of national significance,” Mr Barnett said.
“In fact, Tasmania has already committed over $100 million to Marinus Link, the North West Transmission Development and the Battery of the Nation projects.
“However, the updated estimates of Marinus means we must revisit the project to ensure it’s in Tasmania’s best interests.
“For the right price, Marinus will be good for Tasmania, providing a massive economic and jobs boost, huge advances in bringing on more renewable energy, and continuing to ensure Tasmanians always have among the nation’s lowest power prices.”
Featured image: Energy grid graphic of Victoria and Tasmania. Image credit: Marinus Link.
