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Hey Reader, in today's edition:
- Marinus gets another green light
- 'Pitchfork politics' the worst way to engage
- Charm offensive on 2035 target
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Connecting the 'battery of the nation'
Marinus Link, a landmark piece of intergenerational energy infrastructure for Australia, has reached financial close with an expected $3.8 billion from the nation’s green bank — its biggest transaction — to cover about 80% of the first phase. (ABC) (AFR) (Pulse) (SMH)
The construction of the undersea interconnector cable between Tasmania and the mainland is a vital element in a plan to make the Apple Isle the “battery of the nation” to underpin the National Electricity Market (NEM) when renewables dominate the future national grid.
The funding from the Clean Energy Finance Corporation (CEFC), along with equity from the Commonwealth, Tasmania and Victorian governments in August, has greenlit construction of Stage 1 in 2026, comprising 750MW of capacity, with completion slated for 2030.
The total amount of concessional finance from the CEFC is subject to the regulator’s final determination on project costs.
“Marinus Link is another critical piece in the renewable energy transformation of Australia’s electricity grid. As a specialist green energy investor, the CEFC is committed to using our capital to accelerate the delivery of nation building projects of this scale. As with all our transmission-related investments, we have taken care to structure our finance in a way that maximises the benefits to consumers, by lowering project borrowing costs, which in turn will lower overall project costs.”
Ian Learmonth
CEO, Clean Energy Finance Corporation
Stage 1 will enable future wholesale electricity prices to fall by an estimated $15/MWh for Tasmania and $17/MWh in Victoria on average compared to a no-Marinus Link scenario, according to modelling by Marinus Link Pty Ltd.
“The CEFC’s long-term concessional finance, along with low-returning equity from the government shareholders, is expected to deliver $900 million in benefits to Tasmanian and Victorian electricity consumers during the first five years of the project’s operation. It means that the concessional finance will reduce the impact of transmission-related consumer costs by 45%.”
Stephanie McGregor
Marinus Link CEO
Energy ministers said the net effect was an expected reduction of $25 - $36 on average every year for typical household power bills in Tasmania and Victoria.
Marinus Link is listed as a decarbonisation priority in the National Renewable Energy Priority List and is classified as urgent in the Australian Energy Market Operator’s optimal plan for the grid.
“The Rewiring the Nation (RTN) Fund was created to spearhead investment in transmission infrastructure, long duration storage, electricity distribution network infrastructure and distributed energy resources. Our backing for Marinus Link will deliver substantial investment and economic benefits across large parts of the Australian economy, with cleaner, more affordable renewable energy replacing ageing coal-fired generators as they exit the electricity system.”
Paul McCartney
CEFC RTN Chief Investment Officer
The project includes high voltage direct current cables, fibre optic cables, a communications station, and converter stations at each end. The cables span 345km, including 255km of undersea cables across Bass Strait and 90km of underground cables in Gippsland, Victoria.
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Expert view
"The Marinus project is being proposed because of the growing dysfunction in the
NEM, with the investments required to transition away from coal to renewables
stalled for over a decade under Coalition policies, and stalled again for a range of
reasons including cost overruns and regulatory constraints, leading to the current
situation where there is a very high possibility of insufficient supply to meet demand on mainland Australia around 2030.
Strategies for an orderly transition away from coal to renewables (developed around 2010) cannot be implemented in time to avoid that possibility, leading to the current focus on large scale transmission as a short-term alternative. The transition to a smarter, more efficient grid will, however, happen, and is already happening. That transition, over 10 to 15 years from today, will see a substantial percentage of the large-scale transmission projects currently being progressed, including Marinus, redundant (but possibly necessary in the short
term). Any investors in those large-scale transmission projects should be totally
aware of the implications of that reality. For Tasmania, Marinus repayments, paid by electricity consumers, will continue for up to 50 years beyond the point (around 2040) where Marinus serves any useful purpose.
The main attraction to Marinus for the state government is the projected, modelled
cash bonanza, derived from Hydro Tasmania’s trading activities.”
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John Devereaux
Affiliate Consultant, Goanna Energy
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Expert view
"The announcement helps, I think, to clear up one of the uncertainties around Marinus remaining after the announcement last month, namely, how was it going to be paid for — although there is still uncertainty around how Tasmania will fund the $1 billion-plus investment in transmission infrastructure in the north-west of Tasmania that is an essential part of the overall project.
Marinus is a project that will help the national and Victorian transitions to net zero, and it’s therefore appropriate that the federal and Victorian governments are meeting the bulk of the cost of it; but that it will also contribute to maintaining Tasmania’s energy security after Basslink reaches its end of life, and open up opportunities for Hydro Tasmania to generate additional revenue by selling ‘Tasmanian power to Victorians at Victorian prices’, as opposed to the traditional practice in Tasmania of selling Tasmanian energy to mostly foreign-owned companies at much lower prices than Tasmanians pay for their electricity.”
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Saul Eslake
Independent economist
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Expert view
"Our research found that Tasmania has no meaningful amount of spare capacity that would be needed to provide a firm storage service to Victoria. And Tasmania has no comparative advantage in building the additional renewable electricity production or storage that it will need in order to fill Marinus’ capacity.
We examined this most recently in evidence prepared for a Tasmanian parliamentary inquiry:
The Australian Energy Market Operator (AEMO) has produced an analysis of the net benefit of Marinus Link that relies on a specification of energy policy in Tasmania that is clearly inconsistent with the legislated policy. AEMO also relies on technology assumptions (offshore wind and gas with CCS) in its counterfactual that are not credible. The combination of excluding costs and over-stating benefits gives AEMO the result they were instructed to demonstrate by Tasmania, Victoria and Australia’s energy ministers: that building Marinus Link presents a net benefit.
This is a terrible decision. It, alone, will more than double transmission charges in Victoria and Tasmania.”
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Bruce Mountain
Director, Victoria Energy Policy Centre
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The bush telegraph is running hot
Many farmers want renewables “done right” but transmission lines are divisive for communities, farmland can be seized for easements, and landowners in Victoria are facing fines if they refuse VicGrid entry into their property under new laws.
“Pitchfork politics” — going from zero to protest — is the worst way to engage with public policy, Independent MP Helen Haines says, but she concedes some developers are “cowboys”.
“You can’t separate out policy from politics,” Greens Senator Peter Whish-Wilson says. “The two are interchangeable on many levels, and right now there is a lot of disinformation around renewable energy and infrastructure. I think the prime minister getting chased away from the Bush Summit last week by people on tractors opposing the renewable energy rollout is a good example.”
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Expert view
"We need to have the right people representing us, whether they’re our politicians or whether they’re our industry representatives. We’ve got to have the right people, saying the right stuff.
Farm safety, mental health and knowing your carbon number — It’s fabulous to see DJ (National Farmers Federation President David Jochinke) stand up and say those things but I know his term is almost over … some aren’t necessarily as geared towards climate, and some openly question whether that’s an issue. As a sector, we need to demand that these people represent us and are aware of this and not spread this misinformation.”
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Matt Dalgleish
Co-founder, EP3
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Charm offensive on 2035 target
Chris Bowen said he would soon announce a 2035 emissions reduction target that will be in the “sweet spot” for Australia, and release plans for six sectors of the economy.
“It sends a signal to the rest of the world about how serious Australia is – and we are serious. It will be an ambitious target but an achievable one. There’s no point for government setting a target which we know we can’t meet, which would be great to meet but we just know the country can’t do it. Equally there’s no point setting a target which is so achievable that it’s not ambitious, it’s just going to happen without pushing for further action. I can guarantee you when we do release the target it will annoy everyone because everyone will think it’s either too high or too low.”
Climate Change and Energy Minister Chris Bowen
But he conceded that after releasing Australia’s inaugural National Climate Risk Assessment to set the scene for how much is at stake, the 2035 target might not be legislated, as the 2030 target was. (ABC)
In the meantime, Australians are getting on with it, Bowen said, and adding a household battery at the rate of 1,000 a day – equivalent to one Hornsdale Big Battery every week – and not getting distracted by misinformation about climate change or net zero.
“This is not inner-city latte-sipping lefties, this is Australians in the outer suburbs and regions … going effectively off-grid, making their own energy, saving their own energy and feeding it in when they choose, becoming ‘prosumers’ — producers and consumers all at the same time,” he told the Farmers for Climate Action summit in Canberra.
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Catch Up
Capital
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French electricity giant EDF confirmed further life extensions for two of its UK nuclear power stations. Heysham 1 in Lancashire and Hartlepool in Teesside will continue generating until March 2028, an extension of 12 months.
“We are unleashing a golden age of nuclear as part of our Industrial Strategy, with record funding for Sizewell C and our first small modular reactors – creating thousands of new, skilled jobs across the UK.”
UK Minister for Industry Sarah Jones
 Projects
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Federal approval of the expansion of Glencore’s Ulan coal mine until 2035 is a dangerous step backwards that undermines efforts to shield Australians from climate harm, the independent Climate Council said, releasing data on approvals by the Albanese government. As Cabinet signs off on an “ambitious but achievable” 2035 emissions reduction target range, there are 38 further new or expanded coal mines seeking federal approvals, with a potential lifetime production of over 5.7 billion tonnes.
“Every time this government waves through a new coal or gas project, it undercuts Australia’s 2035 climate goal before it’s even set. Our analysis shows we’d already be starting from a clearly stronger position – about 10 million tonnes closer to net zero – if the government had simply followed the science and stopped greenlighting more fossil fuels.”
Climate Council CEO Amanda McKenzie
The decision comes after the Mudgee and District Environment Group launched a new legal challenge against the NSW government’s approval of the project, arguing the environmental assessment had been inadequate because it failed to consider the project’s climate impacts — an aspect not required to be weighed at the federal level.
A wind farm in Tasmania's central highlands has been approved by the planning appeals tribunal after a challenge from a local community group over noise. Reports show 10 residents in the nearby town of Wilburville could experience noise emissions of between 30 and 35 decibels, marginally over the EPA's allowed limits. (ABC)
Policy
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RE-Alliance joined a broad coalition of 60 organisations urging the federal government to establish a mandatory scheme for solar panel recycling within this parliamentary term.
“More than 95% of solar panels can be recovered and reused or recycled in Australia if the federal government delivers a system that includes all elements of the process: design, reuse, recycling and manufacturing … Regional communities want assurances that renewable projects will be managed well at the end of their life. As well as being an important environmental consideration, materials reuse and recycling can provide new economic opportunities for local industries.”
RE-Alliance National Director Andrew Bray
The Queensland government has been urged to firm up the timeline for the closure of the 1,680MW coal-fired Gladstone Power Station and transmission reinforcement in the region, and accelerate approvals for renewable generation and storage. Analysis by Nexa Advisory found the plant was increasingly unable to meet Queensland’s electricity needs, with outages, poor reliability and falling output threatening heavy industry and households.
Technology
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Australia is the world’s largest exporter of metallurgical coal which is used to make steel, supplying more than half of the global market and emitting more methane than the country’s entire oil and gas sector combined. More than half of the methane emissions can be avoided with existing affordable technology, but only if buyers demand proper monitoring and abatement from their suppliers, according to global think tank Ember Energy, releasing new analysis showing actual methane levels are at least 40% higher than previously reported.
Climate
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US experts denounced a “zombie” Trump administration climate report for reviving the tobacco-industry's tactics to sow doubt around scientific consensus. (AFP)
Carbon capture and storage (CCS) is a useful technology, finds a new study in Nature, but should be limited to 1,290–2,710 Gt of CO2 storage, around 10 times lower than previous estimates. Although the authors recommend CCS as a strategy for climate change mitigation, they also recommend that nations continue to reduce fossil fuels emissions. (Nature) (WashPo)
Research
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Monash researchers have developed membrane technology to extract green hydrogen safely and efficiently from liquid carriers. Supported by the federal Global Connections Fund, the project is now scaling up with Korean partner SMU Airrane and will be tested at Monash and CSIRO’s Membrane Pilot Facility.
“We believe our membrane system is the missing link to supply-chain success – a way to cleanly and efficiently release hydrogen at the point of use, without relying on complex high-temperature processes. Let’s say Australia produces hydrogen using solar power. Instead of liquefying or compressing it, we bond the hydrogen to a liquid carrier and send it off in regular fuel tankers – the same ones already used in the oil industry. Once it arrives, our system unlocks the hydrogen on-site and the empty carrier liquid is returned and reused. It’s clean, efficient and uses infrastructure we already have.”
Director of the Monash Centre for Membrane Innovation, Professor Matthew Hill
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What's On
September 11-12
24th Energy in WA Conference
WA Program Director for The Superpower Institute Jessica Shaw will lead a panel on the nuts and bolts of how flexible, integrated solutions are being delivered, featuring Executive GM Commercial & Growth at AGIG Rachael Smith, APA’s GM Power Development Gary Bryant, Enscope President Phil Ireland, Accure’s Australia Head Alan Coller and AEMO’s System Operations expert Paul Elliott at this event in Perth.
September 16
The Price of Power: The Future of Australia's Energy Sector
Bluescope Chief Executive, Climate Change and Sustainability Deborah Caudle, Alinta Energy CEO Jeff Dimery, AGL CEO Damien Nicks and Australian Energy Council CEO Louisa Kinnear will speak at this American Chamber of Commerce event in Melbourne, with R. Blair Thomas, CEO of US energy investment firm EIG speaking via Zoom.
September 23
AEMO's Annual Results
Australian Energy Market Operator CEO Daniel Westerman and Executive General Manager for Finance and Governance Vanessa Hannan will outline progress against strategic priorities and initiatives, financial results for FY25 and priorities for FY26.
September 24
Updated net zero pathways for Australia
The Net Zero Australia Project team from the University of Melbourne, the University of Queensland and Princeton University will present their latest report on the roles of renewables, energy storage and firming including nuclear, carbon capture and storage and other complementary technologies at this hybrid event.
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