The Australian federal government said it will allocate A$1.5bn ($947mn) to fund renewable energy and transmission projects in Victoria state, as part of its A$20bn Rewiring The Nation plan.

 

The funds will accelerate Victoria's plans to set up an offshore wind industry, which is part of its plan to reach its target of sourcing 50pc of power generation from renewable energy by 2030. The construction of more renewable energy will also provide a platform for Australia's emerging hydrogen sector, which has ambitions to produce hydrogen from renewable sources. Around two-thirds of Victoria's power is generated from coal-fired power plants.

 

The funding will fast-track Victoria's six proposed renewable energy zones (REZ), offshore wind development and a new power transmission link between Victoria and neighbouring New South Wales (NSW), Canberra said. The federal and Victorian governments signed an agreement to jointly fund Victoria's offshore wind projects, REZs and the Victoria-NSW Interconnector (VNI West), known as the KerangLink.

 

The federal, Victorian and Tasmanian governments have also signed agreements on the 1,500MW Marinus Link interconnector, which will provide a second power transmission link between the island state of Tasmania and the Australian mainland and stimulate the construction of more wind projects in Tasmania.

 

The funds from the Rewiring the Nation plan will be allocated through Canberra's Clean Energy Finance Corporation (CEFC), which will provide a concessional loan of A$750mn for VNI West to ensure its completion by 2028. The VNI West link is projected to be able to have the capacity to transmit power from 4,000MW of new renewable energy projects.

 

Victoria will contribute equally with the Tasmanian and federal governments to a total 20pc of project equity to deliver the Marinus Link, while the remaining 80pc of the funding will be through a concessional loan through the CEFC. The Marinus Link is key to Tasmania's ability to meet its 200pc renewable energy target by 2040. A final investment decision on the Marinus Link is expected to reached in around two years.

 

A further A$1bn of funding from Canberra's A$20bn Rewiring the Nation plan will be allocated to Tasmania's Battery of the Nation projects, which comprise 4,800MW of hydropower storage projects.

 

The federal government also has a renewable energy target of 82pc by 2030, up from around a third currently. Argusmedia