Hydro Tasmania and govt terminate Basslink agreement

Subsea cable being lowered into blue-green ocean waters (suncable tasmania)

Hydro Tasmania confirmed it has terminated the Basslink Services Agreement (BSA) and is taking the “next step” in its arbitration with the now administrated owner of the subsea interconnector.

Related article: Basslink enters voluntary administration

“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,” the company said in a statement.

“Consistent with this, Hydro Tasmania 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 while the parties discuss possible alternative arrangements.”

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. 

Minister for Energy and Emissions Reduction Guy 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.

Related article: Marinus Link: connecting Tasmania’s clean energy future

“Tasmanians can be assured that our energy security is stronger than ever and that the Government will continue to act in the best interests of Tasmanians.”

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