ElectraNet Chief Executive, Steve Masters, said ElectraNet’s Board has resolved to commit to proceed with the South Australian section of the project, subject to the AER awarding incremental regulated revenue commensurate with the capital and operating costs of the project.
ElectraNet is continuing to work proactively with the AER to progress the project through its last regulatory approval, with a final determination anticipated in the coming weeks.
Following the AER’s determination, ElectraNet would then enter its Final Investment Decision phase for the project. When it released its preliminary position in December 2020 on the contingent project application for Project EnergyConnect, the AER indicated that the Board resolution from ElectraNet as part of its application should fully reflect the contingent project trigger event.
“The Board’s resolution fully satisfies the final contingent project trigger event requested by the AER to enable it to make a formal determination under the National Electricity Rules,” Mr Masters said. “This is an important project for the national electricity grid and is a priority project for ElectraNet, the Australian Energy Market Operator (AEMO) and many other stakeholders.
“We look forward to concluding the regulatory approval process to support the timely delivery of the project in the interests of electricity customers across the National Energy Market (NEM).”
In addition to the commitment to proceed with the project, ElectraNet has provided the AER with its latest review of the economic assessment of Project EnergyConnect considering recent announcements linked to the NEM.
“ElectraNet is mindful of the rapid pace of change across the NEM and the importance of the project delivering the expected benefits for customers,” Mr Masters said. “We have modelled and considered the potential impact on the project’s benefits from recent policy and market developments – which were not included in AEMO’s 2020 Integrated System Plan – and have concluded that overall, the project benefits are likely to be higher than previously forecast.
“In fact, our latest economic assessment shows that, when combined, these recent market developments increase the expected benefits of the project by between $190m and $440m (present value) compared to the $1.9bn previously reported in September 2020.”
Independent analysis shows Project EnergyConnect is expected to deliver net annual savings of around $100 for a typical household in South Australia and up to around $60 for a typical household in New South Wales – it will drive competition in the wholesale electricity market by connecting more, low-cost generation to the grid and support the ongoing transition to a lower carbon emissions future.
PROJECT ENERGYCONNECT KEY FACTS
• Construction of a new interconnector between Robertstown, in South Australia’s mid-north, and Wagga. Wagga, in New South Wales, via Buronga and with an additional line between Buronga and Red Cliffs, in Victoria.
• New power lines would total nearly 900 kilometres.
• New power substation to be built near Robertstown in South Australia, as well as new transformers and other power infrastructure along the power line’s route.
• Total line capacity of 800 MW – the equivalent of delivering energy to 240,000 extra households.
• Voltage of 330 kV.
• Estimated total project cost of $2.4 billion.
• Subject to receiving all necessary approvals, construction is anticipated to start in November 2021.
• And anticipated to be completed in mid-2023.
• Approximately 200 jobs in SA and 1500 jobs in NSW will be created during construction.
• Creating approximately 250 ongoing jobs in SA and 700 ongoing jobs in NSW from new energy generation projects that would be enabled by the interconnector.
• Typical residential electricity bills are estimated to reduce annually by about $100 in South Australia and up to around $60 in NSW.
• The project would be built near identified Renewable Energy Zones (REZs) to enable the connection of future renewable energy projects to the national energy grid.
• The project will enable South Australia to increase renewable energy production and export it into the national market