Clean energy investors have welcomed the Australian federal government’s multi-billion-dollar joint agreement, alongside the state governments of Victoria and Tasmania, to invest in crucial renewable energy and transmission infrastructure across both states.
The agreement – which is the first step in the recently-elected Labor government’s A$20 billion ($12.53 billion; €12.83 billion) “rewiring the nation” election promise to upgrade the national electricity grid – will see A$1 billion in concessional finance put towards the Marinus Link, interconnecting Victoria and Tasmania, and A$1.5 billion in concessional finance put towards renewable energy zones in Victoria, including offshore wind.
The A$1.5 billion commitment includes a A$750 million loan from the Clean Energy Finance Corporation, to ensure the KerangLink, which interconnects the states of Victoria and New South Wales, is completed by 2028.
Speaking with Infrastructure Investor, David Scaysbrook, co-founder of Quinbrook Infrastructure Partners – which launched a A$2.5 billion green data storage project in the state of Queensland in July – said the funding commitment showed the new Labor government was serious about progressing with the energy transition.
“These things are not easy – [securing] multi-government commitment to finance, particularly with equity and debt – but a lot has been achieved in a reasonably short time,” Scaysbrook said. “For something of that scale, what it shows is that [the new government] is serious about putting dollars to work [and] investing in transmission to promote further renewable energy projects to go ahead.”
“It’s encouraging to private sector investors like Quinbrook that the government is doing more than talking. Based on the signals we were getting at the time of the election, [we have been] refocusing more effort towards Australia, and announcements like this really vindicate the confidence that we’ve placed in this new government.”
Damian Secen, managing director of Equis Development – which is developing a portfolio of renewable energy and circular economy projects in Australia, including the Low Head Wind Farm in Tasmania – said investment in the Marinus project would help unlock Tasmania’s renewable energy potential.
“Tasmania has 2.6GW of hydro power, which is an incredible asset for the country, and the support from the three governments to build the Marinus Link project is a fantastic asset for the National Electricity Market,” Secen told Infrastructure Investor. “As we think about the infrastructure challenge to build new capacity in the market, these links and interconnectors are essential.”
Following the joint agreement to invest in transmission and renewables infrastructure, the Labor government of Victoria – which will see state elections held next month – also announced it would move to ensure government ownership of the state’s renewable power generation by reviving the State Electricity Commission and taking up to a 51 percent stake of new renewable energy projects if it wins in the upcoming elections.
It also promised to raise the state’s renewable energy target to 65 percent by 2030 (up from 50 percent) and commit to sourcing 95 percent of its electricity from renewables by 2035.