Tasmanian Minister for Energy and Emissions Reduction, Guy Barnett, has confirmed that Hydro Tasmania has terminated the Basslink Services Agreement (BSA).
This termination is consistent with the Tasmanian Government’s and Hydro Tasmania’s November 2021 decision to protect Tasmania’s legal rights to the Basslink Cable.
This follows the 2020 arbitration concerning the cause of the 2016 major Basslink outage, which found in the State and Hydro Tasmania’s favour, confirming the link cannot meet the capacity requirements set out in the BSA and that the owner of Basslink should pay compensation to the state.
Since November 2021, Hydro Tasmania, along with the Tasmanian Government, has been in negotiations with the receivers of Basslink regarding an alternative commercial arrangement.
Mr Barnett said the termination of the BSA will not impact Tasmania’s energy security, which remains on firm footing, with very strong hydro storage levels, the Cattle Hill and Granville Harbour wind farms, while the cable will remain in service.
The Tasmanian Government and Hydro Tasmania will continue to engage with Basslink’s financiers and receivers on alternative commercial arrangements, suitable for the receivership period.
Hydro Tasmania remains willing to discuss with receivers an alternative commercial model that could include key elements of the BSA, that would provide funding during the receivership and help transition the asset to an alternative commercial model.
Hydro Tasmania said it has made a good faith offer to the Receivers for an interim arrangement, under which the key elements of the BSA would be put back in place for one month whilst the parties discuss possible alternative arrangements.
The Tasmanian Government emphasised its commitment to ensuring that the energy security of Tasmanians is stronger than ever.