$20m for cable study

THE state and federal governments will jointly fund a $20 million business case study into a second Bass Strait electricity interconnector to help Tasmania become the “battery of the nation”.

Energy ministers from around the nation have gathered in Hobart for a meeting of the COAG Energy Council.

Federal Environment and Energy Minister Josh Frydenberg and his Tasmanian counterpart Guy Barnett will announce the joint agreement today.

“Preliminary findings from this work by Hydro Tasmania indicate a second interconnector could enable Tasmania to expand its wind and hydro capabilities and add more funding power to the national grid, with a net benefit of $500 million,” Mr Frydenberg told the Mercury.

“As the next step, a business case study would examine and finalise the preferred route, optimum size, cost estimate, revenue investment test and financial model for a second interconnector between Tasmania and Victoria.

“This is the next step in tapping the potential of Tasmania to expand its substantial renewable energy base and provide even more affordable, reliable energy to the national grid.”

Mr Frydenberg said the Turnbull Government was already investing in Tasmanian projects such as a feasibility study into 2500MW of pumped hydro storage at 13 different sites, a University of Tasmania stocktake of the country’s tidal energy resources and a smart grid project on Bruny Island.

Mr Barnett said a second electricity interconnector would cement Tasmania’s place in the national electricity market.

“A second interconnector would help unlock the massive potential for renewable energy development in Tasmania,’’ he said.

“It would unlock jobs and it would help us achieve our goal of powering Tasmania with completely renewable energy.

“It will not be used to drain our dams at the expense of Tasmanians, like Labor and the Greens allowed.

“We have raised the prudent water levels to provide greater security and these will not be compromised.”

The 290km Basslink cable cost $800 million to build before it went live in 2006.

Its failure during winter last year — along with low dam levels — contributed to the 2016 electricity crisis.

david.killick@news.com.au