The Victoria to New South Wales Interconnector (VNI West) is a proposed 500 kV overhead transmission line that will connect the Western Renewables Link in Victoria to EnergyConnect in New South Wales.
It will strengthen the grid connection between Victoria and NSW, improving the reliability and security of the grid in both states.
VNI West is one of five actionable projects in the 2022 Integrated System Plan (ISP) (confirmed in the latest 2024 ISP) and critical to maintaining reliable electricity supply for all Victorians as coal-fired generation is switched off.
Coal generation is rapidly retiring, putting the reliability of our electricity supply at risk as energy demand continues to grow. Renewable generation, supported by storage (batteries and hydro) and gas will fill the supply gap.
New transmission is needed to connect renewable generation to homes, schools and workplaces. Renewables projects will be developed in the sunniest and windiest parts of the state –and these are not the same places where coal generators are located. Because the places that we will generate electricity are changing, new transmission lines are required.
While we will continue to use the existing network wherever possible, we need to build new transmission lines to connect new sources of generation with the homes, schools and businesses where it is used.
Transmission Company Victoria (TCV) is a new company created by AEMO Victorian Planning to progress the VNI West transmission project.
AEMO’s 2022 Integrated System Plan (ISP) identified VNI West as a project to be progressed urgently but did not identify any other major transmission developments in the region in the 'most likely' scenario.
The modelling for the PACR also does not forecast further major 500kV network builds in the region to 2050.
Australia’s power system is going through a once-in-a-generation transformation. It is not expected that transmission investment at the current scale and pace will need to continue once the power system has transformed to a low-emission system.
There will always be growth in renewable generation and demand that will require network upgrades, but, absent of a major technology disruptor, these will be minor.
AEMO has started a process to select a partner to work alongside TCV to continue to develop the VNI West project, assist with the completion of the early works, and to eventually construct, own and operate VNI West.
In September AEMO will release a tender to the Transmission Network Service Provider (TNSP) market to identify organisations with the capability and capacity to deliver VNI West in Victoria.
AEMO will carefully evaluate each tenderer’s capabilities prior to selecting a partner by the end of the year. There will be an extensive onboarding period where the successful tenderer will work alongside AEMO to continue to develop the project including the EES process over the next 18 months.
Important criteria for selecting the right partner will include their demonstrated ability to build trust with the community and deliver on community benefits. We will work with the development partner under a collaborative contract model to ensure strong continuity in relationships. The onboarding process will allow the new party a full understanding of issues, concerns and commitments made in discussions with landholders and the community over the past two years. Conversations with landholders and communities will continue to be an important input as the project progresses.
In a practical sense, during this time there won’t be any change in day-to-day dealings with TCV staff. TCV will continue to develop the project through the early works phase, and Councils and community stakeholders including the CRG will continue to engage and consult with the project team.
We believe that a collaborative contract model will deliver advantages to the project and to local communities. It will build on the work done to date by the project team and inject additional expertise, new experience and greater resources to deliver the project efficiently and move it into operations.
Before the project moves into construction, when the time is right, the intention is that TCV will be acquired by the selected partner. It has always been AEMO’s plan to find a Transmission Network Service Provider (TNSP) to build, own and operate VNI West.
AEMO has started a process to select a partner to work alongside TCV to continue to develop the VNI West project, assist with the completion of the early works, and to eventually construct, own and operate VNI West.
AEMO selecting a partner via a tender process by the end of the year. There will be an extensive onboarding period where the successful tenderer will work alongside AEMO to continue to develop the project including the EES process over the next 18 months.
Before the project moves into construction, when the time is right, the intention is that TCV will be acquired by the selected partner. It has always been AEMO’s plan to find a Transmission Network Service Provider (TNSP) to build, own and operate VNI West.
The most recent costings for the VNI West Project are contained in the 2024 Integrated System Plan, or ISP, published by AEMO which provides a cost estimate of $3,614 million (2023 dollars).
These costs are sourced from TransGrid and AEMO Victoria Planning, noting that these costs cover the project across both sides of the border, in Victoria and NSW.
