Energy Cost Explainer:
The One Decision Needed

Tasmania cannot easily change national electricity market rules or global gas prices. But it does control one powerful lever that will shape electricity costs for decades: where new renewable energy projects are built.

The single biggest opportunity to protect Tasmanians from even higher power bills is to concentrate new wind and solar developments close to existing transmission infrastructure. By corralling renewable projects into carefully planned zones near existing lines and substations, Tasmania could significantly reduce the need for new transmission assets. Fewer new power lines mean lower regulated network costs and lower electricity bills over time.

There are additional benefits.

Fewer transmission corridors criss-crossing the countryside reduce impacts on landowners, communities, and landscapes. It can also reduce planning delays, community opposition, and project risk. Additional renewable electricity will come to market sooner and at a lower cost.

Existing developers will not enjoy reading this – they have spent substantial dollars developing projects. But there are over 550,000 Tasmanians who are going to be saddled with the consequences for decades, long after the uproar of relocating projects. Political leadership is required to enable this conversation to be had.

Yes, Tasmania needs more generation for its own developing needs, as we see the population steadily rise and decarbonise the transport and industrial sectors, as well as providing electricity to the other states, but not at any cost. Literally the dollars – but also the environment.

Every new transmission asset approved by the Australian Energy Regulator becomes a cost that consumers must pay for decades. With Marinus Link and the North West Transmission Developments already adding billions to Tasmania’s regulated asset base, and unnecessary additional infrastructure will compound future price increases. Statements by Ministers Nick Duigan and Chris Bowen about renewables being cheap focus on generation costs. But AER regulated network charges are unavoidable once assets are built, regardless of how often they are used or whether wholesale prices fall.

The Basslink decision should act as a warning. Costs previously borne by Hydro Tasmania are about to be transferred to consumers, with the State Government’s support. Many Tasmanians will only realise this when their bills rise. Smarter planning today, fewer projects, better located, closer to existing infrastructure, could materially reduce long-term electricity costs. Once transmission lines are built, the opportunity to avoid those costs is gone.

Tasmania’s clean energy future is certain. Whether it remains affordable is still a choice.