The federal government will own more than 60 per cent of the Marinus Link under a new energy deal with Tasmania.
It was announced on Monday the federal and state governments had signed a memorandum of understanding named the Tasmanian State Energy and Emissions Reduction Deal, which will provide a $93.9 million boost to the state's interconnection with mainland Australia and the National Electricity Market.
It comes after Australia was left off the virtual United Nations climate summit speaking list, alongside New Zealand, Russia, Brazil, Saudi Arabia and South Africa, this week as other countries set new emissions commitments under the Paris Agreement.
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Instead, Tasmania will benefit through a push to fast track the $3.5 billion Marinus Link and the $650 million Tarraleah Battery of the Nation project to final investment decisions.
The deal includes securing an additional $93.9m, through a convertible loan, for the Marinus to push it through to a final investment decision and options to underwrite and/or financially support the Tarraleah Battery of the Nation project to enable a final investment decision if the state government delivers a scope document.
The additional $93.9m from the federal government towards the Marinus comes with a catch. The federal government will own 62.5 per cent of the finished project through a 'special purpose corporate vehicle'. As part of this loan, Tasmania will own 37.5 per cent and a board will be made up of four members, two state and two federal appointees, and a chief executive officer.
As Tasmania has already achieved 100 per cent renewable energy, Premier Peter Gutwein said the deal would help the state increase its generation to 200 per cent by 2040 to export it.
"The MOU will help to further unlock Tasmania's renewable energy potential, with thousands of jobs and over $7 billion in economic activity set to flow as a result," he said.
Prime Minister Scott Morrison said the new deal aimed to lower energy bills, strengthen the grid, improve energy security, reduce emissions and create 2800 jobs, through the Marinus and the BOTN.
He said the two projects would be the backbone of a "reliable, lower emissions" National Electricity Market.
Although the deal promises an emissions reduction, a target or figure was not disclosed.
Mr Morrison will be in Launceston on Tuesday to announce the deal.
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