Ms O’CONNOR – Those who are most impacted, and it’s not just the four major industrials, it’s Aurora, they’re one of the big customers here too, for example and that’s who we buy our power off. Well, most of us do, not all of us.
In terms of input into that review, do you understand what’s going on with that?
Mr DUIGAN – It hasn’t commenced yet. Marinus will be commissioned at the end of 2030.
Ms O’CONNOR – They have forward Estimates out to 2028-29 next year in the budget they’ll be out to 2029-30 which is the year that Marinus will start. One would expect if there’s going to be some sort of pricing policy here that would be reflected. Surely, it’s going to have to start soon that work, wouldn’t you think?
Mr DUIGAN – I would think.
CHAIR – What input would you have into that?
Mr DUIGAN – As the energy minister, my job is to deliver energy to your house and other customers and make sure the lights stay on and keep those costs to customers as low as they can be.
CHAIR – That’s the point I’m making. What’s your input into that process if you are concerned about the cost to customers?
Mr DUIGAN – Very much that.
CHAIR – What are you going to do? How are we going to engage with the process?
Mr DUIGAN – Again, you are asking me to speculate on what the process looks like. We don’t know what the process is or what it looks like at this point. I don’t think it’s entirely helpful for me to be making projections.
CHAIR – Do you know when it’s going to start? Bearing in mind that next year’s budget will have forward Estimates out to that period where presumably, Marinus link will be plugged in?
Mr DUIGAN – The end of 2030 is when it will be turned on. Anyway, it is a job and a piece of work we are committed to do doing
Ms O’CONNOR – Will there be any transparency on that process and how prices are determined? Because there’s long been public subsidies, particularly of major industrials, and there’s never been a line of sight to what MI’s big users are charged therefore, the level of the subsidy that’s embedded in that agreement. We’ve heard the Premier talk about the era of transparency, would that apply to this sort of thing?
Because you can’t argue a competitive advantage or commercially in confidence because they want to be paying some sort of presumably equitably designed from the government’s lights standardised price.
Mr DUIGAN – In terms of what the government does, that will be transparent, detailed in the budget I would expect. As is the way of government spending it’s laid bare for all to see and that would be my expectation. In terms of what ex business pays to Aurora or Hydro for its power, that’s reasonable to to live in the world of commercial in confidence
Ms O’CONNOR – But why?
Mr DUIGAN – Because for you and I, we may not see the sensitivities, but if you are in one of those businesses and running one of those businesses and you have competitors here, there and around the world you know your inputs are very pertinent to your product offering. There are nuances we probably don’t see.
Ms O’CONNOR – Well presumably, they will again be given cheap power and potentially subsidised by other Tasmanian power consumers.
Mr DUIGAN – They provide a lot of jobs and state products.
Ms O’CONNOR – I understand that, and Tasmanian people provide a lot of taxes back and payments back to the government too.
Mr DUIGAN – There is a balance, and we’ve seen this play-out with the discussions for Bell Bay Aluminium recently where we understand the value of that business. They are important, but there is a gap between what we can provide power at and what they need it at.
Ms O’CONNOR – Can I ask about renewable energy zones? There was consultation on the draft REZ legislation which closed in September 2024, so more than a year ago. There’s a lot of communities and interested people who are in the dark about what the REZ legislation, and therefore what it enables, looks like and concern about the industrialisation of the landscape. It was due to be introduced into parliament this year. Do you want to give the committee an update on what the hold‑up is and what the process is?
Mr DUIGAN – Essentially the REZ is designed to offer three kinds of net benefits: existing transmission, the way to build and have transmission paid for. There are national electricity rules which are very prescriptive around how transmission would be built and how it would need to be paid for. REZ seeks to derogate to some extent from the national electricity rules to provide more flexible means of building transmission; so a proponent might be able to build transmission that at some point in the future becomes part of the regulated network but isn’t at the beginning, and various other things like that.
It also seeks to put in place standardised community benefits, so people understand what those things are. It also does define, as it has been, I think, universally rolled out in other jurisdictions – defines an area, puts a line on a map. And I think what we have heard through our consultation would be that there is a degree of resistance to having that line on the map, that people are uncomfortable with that.
Ms O’CONNOR – And you understand that.
Mr DUIGAN – Yes, I do. I know it at a level where I can satisfy myself and say, well, it doesn’t actually change anything other than dictating where we would seek to have people build things. That being said, I do understand the sensitivities, and we’ve heard pretty clearly, and I’ve always said that I wouldn’t just recklessly declare a REZ zone, but what I’m attracted to is the benefits that it brings. So, as we seek to build out all the renewables that we want to see built in Tasmania, how can we do that and only build transmission that’s required, not overbuild, not have a transmission line coming from every single thing that gets built?
Ms O’CONNOR – It’s somewhat reassuring to hear you say that.
Mr DUIGAN – Yes. But in seeking that goal, you need to be able to derogate away from the rules. I’m looking for a REZ model, or call it what you like, a way to enjoy the benefits without necessarily putting the lines on the map.
Ms O’CONNOR – And creating the conflict that can come around that. Can I ask –
Mr DUIGAN – Because I think in Tasmania it’s relatively known where the prospective areas are by virtue of what transmission already exists. Where are the windy spots, for example, where are the good solar spots? So, I’m not sure we need the lines on the map.
Ms O’CONNOR – Can I ask what issues – and you’ve just touched on some of them – but what issues were raised in the consultation and how the government is seeking to address them?
Mr DUIGAN – Certainly that is one that I’ve heard, people concerned about property values, all those sorts of things; people concerned about transmission build‑out; people concerned about –
Ms O’CONNOR – Impact on natural values
Mr DUIGAN – Impact on natural values. Vanessa, you might have a succinct consultation report – and I probably do too, to be honest – but have we published the consultation report on the REZ?
Ms PINTO – No, we have not. Through you, minister: but what I can say is some of the key areas of concern. As the minister has referred to, there were impacts on businesses that are already undertaking business, such as agriculture.
Ms O’CONNOR – Tourism.
Ms PINTO -Tourism impacts, dependent upon the type of development, what it may have to other resources in that area, for example water. There are matters where people may have concerns about health and safety which could be anything from noise levels, air pollution, et cetera, that, as you would I’m sure be very aware as a committee, are areas that the EPA also has equal investment and consideration in. People also indicated concern around foreign ownership of developments coming in and the impact of that.
Ms O’CONNOR – There’s plenty of that.
Ms PINTO – Both on a concern and there were, obviously, opportunities that were raised, equally economic impacts, so a bit of both, of what it could do. You referred to tourism before, but there was also, on the positives, a lot of feedback in terms of what this could do for my regional area, what could this do in terms of jobs and opportunities, what could this do through the supply chain. There was quite a breadth of feedback that was provided, very constructive.
Ms O’CONNOR – Thank you for that. Is there a reason that the – because it’s pretty standard for a consultation report following consultation on legislation to be a public document. Is there a reason why that consultation document hasn’t been released?
Mr DUIGAN – No, I don’t think there is. I’m happy to commit to –
Ms O’CONNOR – Would you commit to doing that?
Mr DUIGAN – Yes.
Ms O’CONNOR – Thank you very much. There was a mapping important places initiative undertaken –
CHAIR – Just to clarify that – you’re asking it to be provided to the committee today?
Mr DUIGAN – No, I’m happy to publish it.
Ms O’CONNOR – Provide it to the committee today, and I think it should be made publicly available, even though they’re sort of a similar thing. Put it up on the website so people who fed in know that the government listened.
Mr DUIGAN – Indeed, yes.
Ms O’CONNOR – There was a mapping important places initiative undertaken as part of the north-west REZ planning in 2023 that allowed the community to mark culturally and environmentally important places. Since that time, the Australian Conservation Foundation released a groundbreaking report called Mapping Renewables for Nature: A roadmap for our energy future which used sophisticated mapping techniques and field surveys to identify sites with low environmental values, but high potential for renewable energy development. Why wasn’t an approach taken like this in developing the REZ? On the basis of your previous answer, is the government prepared to develop a more sophisticated approach to the location of new wind generation particularly?
Mr DUIGAN – Look, it absolutely was part of the REZ and is part of REZ. If we take, for example, the north-west proposed REZ zone, 75 per cent of that, I believe, relying on my memory, is plantation forestry: pretty good spot for a wind farm in my view. It was chosen on the basis of its wind resource, it’s less contested and contestable land use, and a range of factors. I’m sure those natural values are in there as well. That’s the value of the geographical map to outline where is good prospective transmission connection, where is least contested land, so, you know, that’s part of –
Ms O’CONNOR – Still contested now on the north-west coast, but we don’t have to go there at the moment.
Mr DUIGAN – There is no uncontested land.
Ms O’CONNOR – Offshore wind – if no one else has a question, I wouldn’t mind asking about offshore.
CHAIR – If I just go with one other question related to that matter, about the REZ. Minister, you talked about the rules that are currently prohibitive. Can you just expand that out a bit more as to what the prohibition is that needs to be addressed and why?
Mr DUIGAN – As I understand it, it is typically around transmission and how transmission is paid for, and what arrangements you can have with proponents to get transmission built. Craig, or Vanessa probably, might have some more detail around what rules we would be seeking derogation away from in order to have the most efficient, least‑cost‑to‑the‑public transmission building.
Ms PINTO – Through you, minister: the regulatory system that operates, it’s overseen by the Australian Energy Regulator. There’s a number of processes that are associated with that, one of which is as a regulator, they determine what is efficient and prudent investment in assets and on the basis of that, they then determine if an asset that’s being invested in is deemed, let’s say, a quantum of $10 million, I’ll just use a hypothetical, is efficient and prudent and it would apply then to the consumers who are associated with that asset.
Typically, for a transmission asset, it would be within the jurisdiction that’s in – we note with an interconnector there are differences.
There can also be assets that are put into a region that are developer-based so you don’t seek to go through a regulatory system to have the local consumers. It is either borne by the developer and/or the developer and potentially a large offtake provider. You could have an example whereby a renewable development occurs, a larger offtake load, for example, a hydrogen – I am using a hypothetical – have an arrangement and then there is a development of associated transmission.
Derogation is ostensibly where you seek to derogate from legislation and regulations, and there are regulations associated with the way networks are charged, as I’ve explained, and there can be different elements to that that might impose a condition upon developers or loads that are taking it or may require a slightly different nuance. Let’s just say that new transmission line does provide some benefit in providing added security to the local consumers that there would then be some allocation of charging. That in a simplistic way is how it works.
Ms O’CONNOR – I just want an update. First of all, when is the REZ legislation likely to come to parliament?
Mr DUIGAN – I don’t believe we have REZ legislation scheduled for parliament.
Ms O’CONNOR – So, the draft framework that was consulted on is just sitting there cooking at the moment while you consider the consultation feedback.
Mr DUIGAN – How we –
Ms O’CONNOR – Okay, thank you.
Bass Strait has declared an offshore wind zone in December of last year, and there haven’t been many updates since and I want to preface this by saying I’m a massive fan of offshore wind.
What work is Renewables, Climate and Future Industries Tasmania (ReCFIT) doing on offshore wind generation?
Mr DUIGAN – I believe we have a massive opportunity with Bass Strait, which is both relatively shallow and relatively windy, and that’s a good place to build offshore wind somewhat.
Victoria has been very ambitious in this space, and I believe we were due to see auctions for offshore wind take place in November of this year and that has not occurred, as I understand it, there are some delays there, but we would have expected to see some progress on the Victorian side of Bass Strait ahead of Tasmania.
Tasmania has two proponents looking at our offshore wind zone. Is that still the case?
CHAIR – They do require significant investment with TasPorts.
Mr DUIGAN – Again, I believe there was an opportunity potentially for Victoria to be useful in that conversation in terms of what they were seeking to do and Tasmanian ports being pretty critical in that build-out.
In terms of updates, Vanessa, you are best placed for that.
Ms PINTO – I will point out a couple of elements. After the Bass Strait area was designated as an offshore renewable zone by the Australian Energy Market Operator in December 2024, once that was declared, there was then a process where you would need to get a feasibility licence to be in sovereign Australian Government territory, and there were applications open till the 10 April 25.
As I understand it, Nexsphere-Equinor had confirmed they applied for a licence for a 1500 MW project called Bass Offshore Wind Energy, and it’s still going through that assessment process, so, if approved, an offshore feasibility licence allows a proponent seven years to gain its approvals. It’s obviously a very technically complex process to go through, so it needs quite a bit of time to go through that process. So, that would be the first part that I would note.
The second part that I would note is that the government put forward funding for development of a renewable energy services hub. And the concept there is for, not necessarily a physical hub, but a hub that provides support through the supply chain in Tasmania for renewable developments. So, if you were to consider, we have onshore and offshore opportunity for development for local Tasmanian businesses – that could be anything from the electrical componentry that is required within renewable developments; it could be simple as the concrete fixtures for turbines – all of those elements, there could be opportunity for Tasmanian businesses to get into that supply chain. So, that’s part of, also, this area and understanding – almost like a directory of where the opportunities are, to then provide local businesses with the chance to feed into that – is a future pipeline of development in the state.
Ms O’CONNOR – Are there any plans for the Tasmanian Government to be a partner or shareholder in any offshore developments?
Mr DUIGAN – Not at this stage, no.
Ms O’CONNOR – No, but just back to the REZ issue: Given that the north-east and the central highlands area are not as you described – the north-east 75 per cent plantation – and given the feedback from the community consultation, can we get some sort of confirmation from you on behalf of the government that you will undergo more environmental assessments before declaring any more REZs in the future? Like, proper – so that we don’t end up in the situation where we have in the north-west coast, where it’s created significant community concern for a range of reasons, but including the impact on natural values.
Mr DUIGAN – Yes. I can’t sit here in good faith and say I can make community concern go away.
Ms O’CONNOR – No, that’s not the question, because people become concerned about policy decisions for a whole range of reasons, some of which are very personal to them. It’s about the meta‑issue here that we have this long and sorry history in Tasmania of being divided over land use, conflicts and often government steps in and creates or amplifies division. Given the challenges we’re going to face as an island community, if would be really great if government, through policy, stopped trying to divide communities. I’m just keen to know whether there’ll be more consideration of natural values, if any REZ is to be declared in the future, particularly given the environmental sensitivities of the plateau and the Central Highlands and the north-east corner.
Mr DUIGAN – I think it would be worth Vanessa perhaps pointing to what are – noting that REZ legislation is not necessarily going to be brought before parliament to put lines on a map, but in terms of what was contemplated around natural values and other values in selecting the proposed North West REZ. As I have said, it was chosen on the basis of it being a less contested parcel of land. That didn’t mean it was uncontested, but in terms of what we looked at, Ness, or what would be the boundaries for natural values.
Ms O’CONNOR – Yes, and in doing that, I’m curious to explore, because there’s parts of the west coast which may not have the same natural values impacts as other places in Tasmania. When government is thinking about the placement of renewables, they go, okay, not much migrant bird traffic here, maybe we can do this here or encourage this here.
Mr DUIGAN – Until you start looking.
Ms O’CONNOR – The west coast is interesting in terms of those values parts of it.
CHAIR – [inaudible]
Ms O’CONNOR – No, up in the mountain –
Mr DUIGAN – Desolate.
Ms O’CONNOR – It’s desolate. It’s beautiful, absolutely beautiful –
Mr DUIGAN – That’s subjective too.
Ms O’CONNOR – There’s also grasslands.
CHAIR – Barren? It’s hardly barren, there’s all sorts of things up there.
Ms O’CONNOR – I know, it’s extraordinarily beautiful.
Mr DUIGAN – It’s a good spot for a walk.
Ms PINTO – Through you, minister: just in relation to that question, ReCFIT undertook quite a comprehensive spatial analysis that looked over 60 spatial data layers with more than 380 individual spatial features. These included land use, environmental heritage aspects like wind speed, solar values, residential areas, hydrology, potential hazards, terrain, all of that was considered. In that, you – obviously there was consideration of natural values, and the methodology that we’ve applied in undertaking that work is actually available on our website and lists all the values considered in quite a bit of detail. That’s undertaken quite a body of work already in that space that can be referenced for 30 years.
Ms O’CONNOR – Okay, thanks Chair. That will do me for now.
