Work begins on cable to supply cheaper power to South Australia

Construction of the MurrayLink high-voltage cable connecting the Victoria and South Australia electricity grids started this week. It will allow power to be traded directly between the two states and is intended to bring cheaper power to consumers.

MurrayLink will add about 200 MW of energy supply to the South Australia system – enough to meet the electricity needs of around 120 000 households. Brisbane-based Trans௿½ergie Australia, a subsidiary of the Canadian utility Hydro Quebec, has laid the first stage of the 180 km cable.

Estimated to cost more than A$100m ($51m), MurrayLink will be the world’s longest underground high-voltage cable. When complete the interconnector will stretch from Red Cliffs in Victoria to Monash in South Australia’s Riverland.

MurrayLink should come into operation in the latter half of 2001, in time to help reduce South Australia’s anticipated energy supply shortages during the summer.

At full capacity, MurrayLink would supply only eight per cent of South Australia’s peak summer demand, but MurrayLink treasurer Rob Lucas described it as an important part of a package of measures to relieve price spikes. “This is a critical part of the jigsaw puzzle to give us a more secure electricity system in South Australia and a more competitive electricity market,” he said.

Also crucial to the equation are a number of new “peaking” plants due to come on-line in South Australia and Victoria before summer.

Lucas, while supportive of the rival Riverlink project, said the NSW/SA interconnector was still two years away even if it received the regulatory approval next month. “The Independent Regulator has noted that the MurrayLink interconnector, together with the Snowy to Victoria interconnector upgrade, might achieve many of the claimed benefits for Riverlink,” he said.

Electricity Week magazine editor Laurel Fox Allen agreed MurrayLink would help to reduce prices. “At points of high demand it should dampen high prices in SA – in fact it should help to harmonise prices,” Fox Allen said.

But Opposition treasury spokesman Kevin Foley said MurrayLink was too late for businesses that entered the deregulated market on July 1.

“Labor welcomes more electricity but it is of little value to the 2000 businesses in SA that are already locked into 30-90 per cent increases,” he said.

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