CEFC commits $3.8b to Marinus Link, the bank's biggest transaction
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The news: The Clean Energy Finance Corporation (CEFC) has committed an expected $3.8 billion in concessional debt to stage one of the Marinus Link undersea and underground electricity and data transmission project between the North West Tasmania and the Latrobe Valley in Victoria.
The federal, Tasmanian and Victorian government co-owned project has now reached financial close.
The numbers: The first stage of Marinus Link is planned to have a capacity of 750 megawatts, which the federal government says is enough to power roughly 750,000 homes.
The $3.8 billion long-term concessional debt finance investment represents the federal government green bank’s single biggest transaction and includes capitalised interest during construction. Funding is being delivered through the Rewiring the Nation Fund.
However, the “final amount of concessional finance is subject to the regulator’s final determination on project costs”, according to the green bank.
The government also expects the project will enable “future wholesale electricity prices to fall by an estimated $15 per megawatt hour for Tasmania and $17 per megawatt hour for Victoria compared to a no-Marinus Link scenario”.
The context: Construction on stage one is expected to commence in 2026 and is expected to be complete in 2030. Marinus Link will be the second undersea transmission cable between Tasmania and Victoria, the first is Basslink which has a continuous capacity of 500 megawatts.
Marinus Link will be 345 kilometres long. This will consist of 255 kilometres of undersea cable across the Bass Strait and 90 kilometres of underground cables in Gippsland, Victoria.
The federal, Tasmanian and Victorian governments have previously made equity investment commitments to the project.
What they said: “As with all our transmission-related investments, we have taken care to structure our finance in a way that maximises the benefits to consumers, by lowering project borrowing costs, which in turn will lower overall project costs,” CEFC chief executive Ian Learmonth said.
The source: CEFC media release
