Increasing capacity for generation in the Molong and Parkes area

The Molong and Parkes area has seen significant growth in renewable generation connections to the transmission network, as part of the wider energy transition. New renewable generators have connected or are planning to connect to the network west of our Molong 132/66 kV substation.

Line 94T (Molong-Orange North) plays a central role in transmitting the electricity from these renewable generators in the Molong and Parkes area to the load in Orange. It connects Molong substation to Orange North switching station, which in turn supplies Orange city, Cadia Mine and surrounding areas.

Transgrid has applied the Regulatory Investment Test for Transmission (RIT-T) to increase overall benefits in the NEM through improving capacity and relieving existing constraints on renewable generation in the Molong and Parkes area. This will enable greater output from renewable generation in this region of the NEM.

Transgrid must show that the preferred option for proving net benefits to the market by improving capacity for renewable energy generation in the Molong and Parkes area will deliver the greatest net benefit to energy consumers. The net benefits delivered by the project are assessed using the Regulatory Investment Test for Transmission (RIT-T) administered by the Australian Energy Regulator (AER).

The RIT-T assess network and non-network solution options from a technical and economic perspective by:

• Informing stakeholders of the investment need and proposed options to address this need.
• Testing the market for alternative and more efficient solutions.
• Explaining to stakeholders the basis on which the preferred option has been selected. 

In July 2022, we published a Project Specification Consultation Report (PSCR), the first stage of the RIT-T. The PSCR detailed the need to increase overall net market benefits to the market by improving capacity for generation in the Molong and Parkes area and describes the credible options to meet the need, including technical characteristics that would be required of a non-network option.

We received submissions from five parties in response to the PSCR. Of the five parties that submitted to the PSCR, three parties requested confidentiality, therefore we have not published their material on our website.

The following submissions are approved for publication. For privacy purposes, personal information has been redacted from these published submissions.

In June 2023, we published the Project Assessment Draft Report (PADR) that provides transparency into the planning considerations for investment options to increase capacity for generation in the Molong and Parkes area, and the associated market benefits. A key purpose of this PADR, and the RIT-T more broadly, is to provide interested stakeholders the opportunity to review the analysis and assumptions, provide input to the process, and have certainty and confidence that the preferred option has been robustly identified as optimal.

Submissions received in response to the PSCR were considered when preparing the PADR. The PADR includes a full quantitative analysis of the proposed options and expected net market benefit across a range of scenarios and sensitivities. We published the following supporting documents:

We invited written submissions on the material contained in the PADR. We received from 3 parties in response to the PADR, and all parties requested confidentiality, therefore we have not published their material on our website.

In October 2023, we published the Project Assessment Conclusions Report (PACR) for increasing capacity for generation in the Molong and Parkes area.

The PACR was prepared as the final step in the Regulatory Investment Test for Transmission (RIT-T) process and followed the Project Assessment Draft Report (PADR) published in June 2023.

The assessment in the PACR finds restring Line 94T with higher rated ‘Flicker/ACSS’ conductor existing structures as the preferred option for meeting the identified need.

In the PACR we outlined that our next step upon conclusion of the RIT-T was to proceed to a detailed design stage for the preferred option (Option 2: restring Line 94T with higher rated ‘Flicker/ACSS’ conductor on existing structures) prior to its implementation.

We noted that if, during the detailed design stage, another conductor with the same or higher rating and similar costs and benefits as Option 2, was found to be more fit for purpose, we may amend the preferred option to use the alternative conductor. We stated that we would only adopt an alternative conductor, if its use would not result in a material change to the net benefits of the option or a delay to when the option can be implemented and subject to updating stakeholders on the proposed changes. During the detailed design process an alternative conductor for Option 2 was found to be fit for purpose, resulting in the preferred option being amended to use this alternative conductor (Invar).

Due to not being able to progress with the conductor that was proposed in the RIT-T, the planned timing to deliver the project has been delayed. The planned timing to deliver the project noted in the PACR had commissioning possible in 2025/2026. This was updated in our 2024 Transmission Annual Planning Report (TAPR), with the proposed in-service date listed as June 2026 and has extended by 6 months to December 2026 as per our 2025 TAPR. The work is now scheduled to be undertaken in 2025/26 with commissioning possible by 2026/27.

We conducted a Material Change in Circumstances (MCC) Assessment which demonstrates that there is no material change to the net benefits of Option 2. Despite the use of an alternative conductor and the updated timing, Option 2 remains our preferred option. Therefore, no MCC event has occurred.

In the interest of updating stakeholders, we have made this information available on our website and will be notifying all Interested Parties who made submissions in response to the RIT-T.

If you have any questions about the project, please contact network.solutions@transgrid.com.au or phone 1800 222 537.