VicGrid’s draft 2025 Transmission Plan: overview

In the 2024 plan, three tiers of geographic areas were considered by VicGrid for potential REZs as outlined in the 2024 Victorian Transmission Plan Guidelines. Following community and industry consultation, the draft VTP now designates seven major REZs across regions such as Gippsland, Central Highlands, and the Wimmera, as shown on this map.

The process carried out to narrow down the areas is said to have considered economic costs, land use, community preferences, regional development opportunities, generator interest, existing levels of development, wind and sun access, cultural heritage information and community and industry feedback. 

Of note is the fact that the previously identified Oven Murray REZ has been excluded from the draft plan, while the Central North REZ now excludes the Glenrowan region and Benalla, areas with ongoing, existing solar farm projects. In their place, the draft VTP focuses on other regions, such as Victoria's west, for initial development.

In comparison to the five larger REZs being rolled out in New South Wales, Victoria’s seven proposed REZs are smaller in size. The proposed Victorian REZs aim to provide land for over 8 GW of new capacity, while NSW is planning more than 11 GW of capacity within its REZs.

It is important to understand that the REZs are not equivalent to zones under a Planning Scheme, nor, at the moment, are the REZs referenced in any way in the Planning Policy Framework. All proposed projects (both within and outside REZ areas) will still need to be assessed on a case-by-case basis under the applicable Planning Scheme; however, there is an expectation there will be further reforms to follow of the environmental assessment process to provide more streamlined environmental assessment for projects that are within the final REZ areas.

There are seven proposed Transmission Projects, including the construction of approximately 380 km of new high-voltage power lines and the upgrading of 430 km of existing lines as follows: 

• a second Hazelwood to Yallourn double circuit 220 kV line in Gippsland (~10 km long), planned for 2028;
• the Gippsland offshore wind transmission stage 2 project, adding two new 500 kV lines from Driffield to Woodside and Woodside to Giffard, plus new terminal stations;
• the stage 2 transmission loop will support ~7 GW of offshore wind energy when combined with stage 1, planned between 2033–2038;
• a new 500 kV line in South West Victoria, from Tarrone to Sydenham, following existing transmission easements, needed by 2033; and
• a new 500/220 kV terminal station near Truganina, plus two 220 kV lines linking to Deer Park terminal station.

While the draft plan identifies these projects as being needed, the location where each line will be built has not yet been identified. A more detailed planning process for these projects will be conducted over the next three years.

Unlike REZs, the Gippsland Shoreline Renewable Energy Zone is not designed to host onshore wind or solar projects and generators. Instead, it will provide a limited area where offshore wind developers will need to site and coordinate their connections to the power grid, while minimising impacts on host landholders, communities, nearby towns and landscapes.

For developments inside a proposed REZ, inclusion in the Transmission Plan does not replace statutory planning and environmental approval processes, including approvals and engagement requirements for projects. However, by incorporating community consultation, environmental inclusion and social factors early in the approval process, the VTP is intended to support the efficacy of relevant approval processes. 

Specific changes would be required to be made to the Planning Schemes and to the Environmental Effects Act 1978 (or the Ministerial Guidelines under that Act) in order to provide any benefit in a statutory approval sense to being within a REZ. At this stage, there is no proposed planning scheme amendment to facilitate such changes. 

Projects that ultimately fall outside of a final REZ will be subject to a Grid Impact Assessment. As part of this assessment, these projects must meet both government-set standards of community engagement and benefits and demonstrate that their connection will not have a negative impact on projects inside the REZs by limiting their generation or taking up capacity on the grid.

Furthermore, if changes are made to the Planning Schemes or EES process to provide that the REZ must be considered in making planning decisions, then falling outside a REZ could make it more difficult to obtain planning approval for these projects.