Victoria to NSW Interconnector Upgrade


TransGrid and the Australian Energy Market Operator (AEMO) are recommending critical short-term investment to increase the transfer capacity of the existing transmission corridor from Victoria to New South Wales (NSW). 

Together with AEMO, TransGrid has published a Regulatory Investment Test for Transmission (RIT-T) Project Assessment Conclusions Report (PACR).

In November 2018, TransGrid & AEMO published a RIT-T Project Specification Consultation Report (PSCR), which is available below. The PSCR detailed the need to upgrade the existing Victoria to New South Wales interconnector capacity and described the credible options to meet the need, including technical characteristics that would be required of a non-network option. In response to the PSCR, we received nine public submissions and a confidential submission. All public submissions can be viewed on the AEMO website.

In August 2019, TransGrid and AEMO published a RIT-T Project Assessment Draft Report (PADR), which is available below. The PADR outlined how the issues raised in submissions were addressed and explained the basis on which the preferred option was selected. The PADR detailed the options, including non-network options developed by third parties, which were available to address the need identified in the PSCR. It also compared the value proposition and recommended a preferred investment option to ensure the maximum benefit is received by producers, transporters and consumers of electricity in the market.

The PACR confirms the initial investment option proposed in the PADR. The PACR analysis took into consideration the status of other RIT-Ts in progress at the same time and confirmed that the preferred option remains justified. The preferred option is consistent with the Group 1 priority project identified in AEMO’s Draft 2020 ISP.


Project Assessment Conclusions Report (PACR)


Project Assessment Draft Report (PADR)

In order to assess all network and non-network options from a technical and economic perspective, we are using the Australian Energy Regulator’s Regulatory Investment Test for Transmission (RIT-T). The RIT-T is a formal consultation process designed to:
  • Inform stakeholders of investment need and proposed options to address it
  • Test the market for alternative and more efficient solutions
  • Explain to stakeholders the basis on which the preferred option has been selected. 
The RIT-T consultation process has three stages:

RIT-T

We have now completed the third stage of the process, having published the Project Assessment Conclusions Report (PACR).
 

Submissions and next steps 

TransGrid and AEMO received nine public submissions on the PSCR and six on the PADR. Submissions received (and approved for publication by proponents) can be viewed via the AEMO website.

TransGrid and AEMO are now in the midst of the pre-investment activities. TransGrid will submit a Contingent Project Application to the AER in order to seek approval to vary its current 2018-23 Revenue Determination by an amount that reflects the prudent and efficient costs for the parts of the investment in NSW.