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The Australian Energy Regulator (AER) has called for a significant reduction in the proposed construction capital expenditure for Marinus Link’s Stage 1. The AER’s final decision is to approve the proposed capital expenditure of $3,470.6 million, some $27.8 million less than that proposed by developer Marinus Link.
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The regulator’s final decisions, in through February CY26, on construction costs have concluded a near-decade of analysis and consultation. Marinus Link is a proposed undersea and underground electricity and data interconnector between North West Tasmania and the Latrobe Valley in Victoria.
Marinus Link has labelled the project “a two-way clean energy highway.” It will combine Victoria’s wind and solar with Tasmania’s hydropower and wind projects.
The combined Marinus Link and NWTD projects form Project Marinus. Stage One will deliver a 750-megawatt cable connecting Victoria and Tasmania (Marinus Link), and associated transmission upgrades to the existing on-land transmission network in north west Tasmania (NWTD). Stage Two will then deliver a second 750-megawatt cable connecting Tasmania through to Victoria.
Operator MLPL’s three shareholders are the Australian Government (49%), the Victorian Government (33.3%), and the Tasmanian Government (17.7%).
The AER stated that costs for Marinus Link will be recovered from Tasmanian and Victorian electricity consumers once the project commences services, which is currently expected in CY30. The allocation of costs for Marinus Link will be based on an agreement between governments.
AER chair, Clare Savage, said the agency had closely scrutinised proposals, particularly the sharing of risk between Marinus Link, TasNetworks and consumers.
“There has been significant interest and a diverse range of views from stakeholders through our consultation process, reflecting the complexity of a project of national significance across multiple states,” Ms Savage explained.
She continued: “This adopts a balanced approach to risk sharing between Marinus Link and consumers, providing incentives for Marinus Link to mitigate risks and contain costs that are ultimately paid for by consumers, while providing it with the opportunity to recover its construction costs.”
Marinus Link CEO, Stephanie McGregor, said the AER’s decision has paved the way for full construction. “We thank the AER for recognising our discipline in managing the project’s construction costs on behalf of electricity consumers,” she said.
“Our role now, as a regulated company and the custodians of national energy infrastructure, is to deliver efficiently, responsibly, and ensure the benefits are enduring for all Tasmanians and Victorians. Preparatory works are already underway. This final decision gives us the confidence to take construction into full swing.”
Marinus Link includes high voltage direct current (HVDC) cables, fibre optic cables, a communications station, and converter stations at each end. The project’s cables span 345km and include 255km of undersea cables across Bass Strait and 90km of underground cables in Gippsland, Victoria.
The project’s 1500 megawatt (MW) capacity is equal to the power supply for as many as 1.5M Australian homes and approximately three times the capacity of the existing Tasmania to Victoria interconnector, Basslink.
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