Victoria offers cash incentives to smooth transmission development

As Victoria’s ageing coal-fired power stations retire and are replaced by renewables, the state government has announced it will pay landholders who host new transmission infrastructure $8,000 per kilometre per year for 25 years.

Energy Minister Lily D’Ambrosio said the payments, which will be in addition to any easement payments from network companies, acknowledge the critical role landholders who host transmission infrastructure will play in the state’s energy transition.

“These new payments acknowledge the hugely important role landholders play in hosting critical energy infrastructure – a key part of Victoria’s renewables revolution,” she said. “We want to get the process for planning and approving new infrastructure right, so we can make sure the renewables revolution is a shared, equitable legacy for all Victorians.”

D’Ambrosio said the first of the annual $8,000 payments will go to landholders who host transmission lines along the Victoria to New South Wales Interconnector West (VNI West) and Western Renewables Link transmission corridors.

The VNI West project will likely connect Ballarat in central Victoria with Kerang in the north and across to NSW, while the Western Renewables Link corridor will stretch from the Melbourne suburb of Sydenham to near Stawell in the state’s west.

The scheme will also apply to the Victoria-Tasmania Marinus Link project and transmission links connecting Victoria’s Renewable Energy Zones (REZs) and future offshore wind projects.

This scheme follows in the footsteps of the NSW government who announced in 2022 a payment plan of $200,000 per kilometre of new transmission infrastructure for landowners, paid out in annual instalments over 20 years.

The Victorian government’s payment scheme has been broadly welcomed by advocacy groups but Community Power Agency (CPA) said more needs to be done to address landowners’ concerns about devaluation of property, visual impacts, and compensation.

“It’s a step in the right direction in that the Victorian government is acknowledging that the community and the landholders really do have an important role to play in enabling this climate critical infrastructure,” said CPA Director Kim Mallee. “But it is essential that the community has a genuine seat at the table when we’re designing these kinds of policies and the way that we roll out infrastructure like transmission lines for the energy transition.”

Farmers for Climate Action, an organisation representing more than 7,500 farmers nationally, agreed that the scheme is “a step in the right direction.”

“If transmission uses a farmers’ land, farmers should be paid for it. It’s only fair,” Farmers for Climate Action Strategy Director Cam Klose said. “While we are still waiting to see more detail, it is definitely a step in the right direction and we hope will help ease community concerns over the build-out of transmission infrastructure.”

“We know we need transmission lines to connect renewable energy to consumers … farmers need to be respected and rewarded for transmission on their land and this policy recognises it.”