Targeted investment critical to enable Victoria’s energy future

2 min

In its unique role as the Victorian transmission network planner, the Australian Energy Market Operator’s latest analysis shows that Victoria’s transmission network remained secure in 2020-21, in light of continued high levels of investment in renewable generation and record low minimum operational demand.

The 2021 Victorian Annual Planning Report (VAPR) builds on AEMO’s Integrated System Plan (ISP) and assesses the capability, performance and adequacy of the state’s transmission network – the Declared Shared Network (DSN) – to meet Victoria’s energy reliability and security needs over the next 10 years.

The report observes that while the Victorian network remained secure, the operational landscape is becoming increasingly complex. Continued investment in large-scale renewable generation projects, particularly in areas where network limitations persist, and rooftop photovoltaic (PV) are impacting the stability and complexity of power system operations.

AEMO CEO, Daniel Westerman, said: “In the last 12 months, 1.2 gigawatts (GW) of renewable generation connected or commenced commissioning in Victoria, while rooftop PV grew to 3.1 GW”.  

“This growth in renewable resources is driving down minimum operational demand and displacing traditional generators, which provide essential system strength services,” he said.

“Targeted investment in transmission infrastructure is critical to enable the energy future and to harness Victoria’s rich energy resources in a cost-effective way to the benefit of consumers across the state and the National Electricity Market.”

“It is pivotal that future transmission infrastructure is sensitively planned and designed to minimise local community impacts as much as possible,” he said.

The VAPR outlines a pipeline of committed and future network development projects to address changing network needs and strengthen power system resiliency, captured in the ‘Transmission Development Plan for Victoria’.

“AEMO is progressing a suite of network development projects over the next decade, to address system challenges, maintain supply reliability and system security, in the context of government policy objectives such as the Victorian Renewable Energy Target (VRET),” said Mr Westerman.

“Milestone projects include the Victoria to NSW interconnector (VNI) Upgrade  and  connections uplift program which aims to improve consistency and clarity in the connections process.

“These developments will continue to reduce overall costs for all consumers by unlocking lower-cost generation supplies, enhancing competition and improving the efficiency of resource sharing between regions,” he said.

Working alongside the Victorian Government on its recently launched Renewable Energy Zone Development Plan (RDP) which is supported by the Government’s $540 million REZ Fund, AEMO’s Transmission Development Plan for Victoria factors in the VRET of 40% renewable energy generation by 2025 and 50% by 2030.

“The RDP will map out how alternative patterns of generation might impact the optimal development of transmission in the state, considering network projects that might best support areas of high developer interest, and will enable 10 GW of new renewable energy capacity in Victoria,” said Mr. Westerman.

The VAPR provides an opportunity for a comprehensive overview of Victoria’s power system to proactively identify and assess future limitations and inform stakeholder decision-making. AEMO will continue to work closely with stakeholders, including other Network Service Providers (NSPs), industry stakeholders, consumers representatives, and other interested parties to develop a power system to the benefit of consumers.

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