Minister provides stamp of approval for VNI West powerline plan

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Victoria’s $3.25 billion flagship electricity transmission project, the Victoria-New South Wales Interconnector (VNI) West transmission line that will link the high-voltage electricity grids in both states is a step closer after the minister responsible signed off on an order to advance its development.

Victoria Energy Minister Lily D’Ambrosio confirmed she has signed a ministerial order to progress the Australian Energy Market Operator’s (AEMO) preferred route for the proposed 500 kV double-circuit overhead transmission line that will connect to the EnergyConnect project in NSW and the planned Western Renewables Link (WRL) in Victoria.

“Progressing critical transmission projects like VNI West is necessary to deliver cheaper, more reliable renewable energy to Victorian homes and businesses,” D’Ambrosio said in a statement. “There can be no energy transition without new transmission infrastructure. As Victoria moves towards 95% renewables by 2035, we have a duty to modernise our electricity network.”

AEMO Victoria Planning (AVP), which is developing the project in conjunction with network company Transgrid, is now working to finalise the route for the VNI West project after outlining the preferred option and a geographic area of interest for the transmission link in the Project Assessment Conclusions Report (PACR).

The preferred option, Option 5A, would connect the VNI West to the WRL at a terminal station at Bulgana in Victoria’s west, then link up with a substation near Kerang in north central Victoria before crossing the Murray River north of Kerang, linking to the EnergyConnect line at Transgrid’s Dinawan substation north of Jerilderie in NSW.

Options 5 and 5A as outlined in the PAC report.

Image: AEMO

AVP Group Manager Nicola Falcon said the preferred option has reshaped where VNI West crosses the Murray River, with the final option adjusted to reflect stakeholder feedback identifying constraints around culturally and environmentally significant areas as well as zones of irrigated agriculture.

“Feedback received has helped us identify a preferred option for the critical transmission line – a variant of the previously proposed option – that delivers the most benefits for consumers and more electricity generation from three REZs in Victoria and NSW,” she said.

“By crossing the Murray River further north-west, the project can also avoid some sensitive cultural areas and prime irrigation land identified in feedback from local communities.”

AVP said the preferred option also harnesses more renewable generation than the previously proposed option, allowing for an estimated 3.4 GW of renewable generation to be built across the solar-rich South West NSW, Murray River and Western Victoria renewable energy zones (REZs).

Identified as a core component and priority project in AEMO’s 2022 Integrated System Plan, VNI West has the potential to add 1.93 GW of electricity export capacity from Victoria to NSW, and 1.67 GW of electricity import capacity from NSW to Victoria, improving the reliability and security of electricity supply as ageing coal-fired power stations are retired.

It has however attracted widespread opposition with more than 500 submissions received in response to a call for stakeholder feedback on the project with some critics labelling the project a “monumental mistake”, claiming it would be easier to upgrade existing transmission lines and that the project could triple transmission charges.

Communities and landowners in the affected areas have also raised concerns about disruptions during construction of the transmission towers and lines, ongoing impacts on the environment and farming operations, and negative effects on land values.

In a bid to smooth the way for the project, the state government has announced it will offer private landowners $8,000 per year for 25 years for every kilometre of land over which they allow transmission lines to be installed and AEMO said consultation with potentially impacted landholders will now intensify as they seek to refine the route, with a focus on minimising impacts on landholders, the environment and farming.

While the VNI West project still requires relevant planning and environmental approvals, AEMO said a new company, Transmission Company Victoria (TCV) has been established to undertake early works in Victoria, including community, landholder and traditional owner consultations and ongoing investigations into the corridor and ultimate route.

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