Estimated Expenses for Victoria’s Renewable Energy Transmission Project Expected to Increase Twofold | Power Sector

One of Australia’s largest renewable energy transmission projects, as outlined in the latest version of Victoria’s 2025 Transmission Plan, has expanded areas for solar, battery, and wind developments, with the cost of connection nearly doubling. VicGrid, a state government agency, released the updated plan, increasing the available land for developers by 200,000 hectares. The plan includes designating parts of the state as renewable energy zones and outlining the necessary new transmission infrastructure to connect these zones to the grid over the next 15 years. The increase in land designated for renewable energy projects, from 1.66 million hectares to 1.88 million hectares, responds to industry feedback that larger areas are needed for technical and commercial viability. The amendment also adds more renewable energy zones, increasing the total to nine from seven. Despite concerns about the impact of power bill costs on private landowners, more than 42% of Victoria’s electricity came from renewables in the past financial year, with the state reaching record levels of renewable energy generation. The state energy minister, Lily D’Ambrosio, emphasizes that Victoria consistently has the lowest wholesale power prices in the country, which helps in slashing energy bills for families and businesses. However, the latest modeling predicts that the cost of connecting Victoria’s renewable energy zones could almost double from an initial estimate of $4.3 billion to $7.9 billion, largely due to new Australian Energy Market Operator costings. The increase in costs is expected to be mostly recovered through higher consumer bills, but the overall argument is that Victorians will be better off with wholesale energy costs lowered by the integration of more renewable energy into the grid. The federal government aims to have 82% of renewable energy in the national grid by 2030, up from 43% this year.

Source: https://www.theguardian.com/australia-news/2025/aug/17/cost-victoria-expanded-renewable-energy-transmission-plan