The VNI West project was assessed in its early stages via a Regulatory Investment Test for Transmission (RIT-T). The RIT-T is an economic cost-benefit test; it is like a business case conducted early on in a transmission project, to determine if it will deliver economic benefits.

This regulatory process ensures energy users avoid paying more than necessary for electricity.

Various options were analysed as part of this process, and the preferred Option 5A was identified and described in the PACR, the final RIT-T report published in May 2023. Option 5A maximises benefits for consumers while meeting the power system needs. It established the broad area of interest for the project, including locations for connecting the project into the existing network.

AEMO identified several issues in the Plan B report, including several incorrect assumptions. Overall, AEMO does not consider Plan B to be a viable alternative to VNI West. Please find AEMO’s response to the Plan B report here.

VicGrid also commissioned Jacobs Group Australia to undertake an independent assessment of Plan B. This was released in April 2024 (see VicGrid website). The review did not support Plan B’s assessment and suggested alternative to VNI West, finding that VNI West meets Victorian energy objectives. The review also found that Plan B had underestimated the benefits of the VNI West project and would present its own risks and challenges.

AEMO’s 2018 integrated systems plan (ISP) identified the need to have better connection between electricity grids in NSW and Victoria. The ISP was developed after consulting with:

  • Energy experts from academia, market bodies and industry.
  • The ISP Consumer Panel comprised of energy experts with industry knowledge
  • Governments, market bodies, consumer advocates and industry
  • Academics and technical experts
  • External independent expert advice on inputs, assumptions and modelling

The VNI West project was assessed in its early stages via a Regulatory Investment Test for Transmission (RIT-T). The RIT-T process included wide consultation with stakeholders, including public consultation and submissions, roundtable workshops, webinars and information sessions. Following the conclusion of the formal RIT-T process in May 2023, community and stakeholder consultation continues to be an important part of project development. See the Community section of the TCV website for more detail on current and planned activities.

Independent input is integrated into project development at every stage. AEMO’s Integrated System Plan is developed through a rigorous process reflecting expert advice on inputs, assumptions and scenarios from energy experts from academia, market bodies, industry and government, and from feedback on the draft plan.

The subsequent Regulatory Investment Test for Transmission (the business case for the project) is also extensively consulted on. Industry experts and interested parties providing feedback on the suite of credible options to be assessed, the assumptions and approach adopted for the assessment, and the proposed preferred solution. The Australian Energy Regulator also plays a role in ensuring compliance with the regulatory process.

Transmission Company Victoria (TCV) is the company created by AEMO to progress the VNI West transmission project. TCV is responsible for the early works and planning phase of the project’s development, which includes environmental and planning approvals including a comprehensive EES.

Through a tender and development process run by AEMO in 2024 it is the intention that a new owner will be selected to continue to develop the VNI West project alongside TCV, and ultimately acquire TCV and build, own and operate the transmission line.

The build, own and operate phases of the project will be governed via appropriate agreements between the new owner/operator and AEMO.

The Australian Energy Market Operator (AEMO) is accountable for the development and delivery of the VNI West project.

  • The Victorian Government is progressing reforms to change the way transmission is planned and developed in Victoria, through the Victorian Transmission Investment Framework (VTIF).
  • Under the changes proposed, responsibility for planning transmission infrastructure in Victoria, would be transferred to VicGrid from AEMO.
  • This transfer is subject to legislation passing Parliament next year. Any transfer would be enacted in a staged and carefully considered approach in close consultation with AEMO to enable an orderly transfer of responsibilities.
  • In the meantime, there is no change in AEMO’s role and responsibilities with respect to the VNI West and other projects such as WRL.
  • AEMO is currently accountable for the outcomes of VNIW: ensuring that network services are delivered at best value on behalf of Victorian Energy Consumers. The transition of accountabilities to VicGrid means that VicGrid will take over this accountability, including for the VNI West project.
  • This will not change the role of TCV or its responsibilities in relation to the community and delivering the next phase of the project.

You can learn more via TCV’s Roles and Responsibilities Fact Sheet.

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