Consultation open: new draft Guideline for Offshore Electricity Transmission and Infrastructure Licences

By Meg Lee and Sal Lennon

The Australian Government’s Department of Climate Change, Energy, the Environment and Water (the Department) has released a new draft guidance for Offshore Electricity Transmission and Infrastructure Licences. This includes a Guideline and Application Content Guide. Consultation is open until 7 June 2024 via an online survey.

The draft Guideline and Application Content Guide are intended to:

• provide guidance on the Offshore Electricity Infrastructure Act 2021 (Act) and associated Regulations;
• supplement the existing Guideline on Feasibility Licences; and
• assist prospective licence holders to understand the requirements and processes for obtaining and holding transmission and infrastructure licences.

Draft Guideline – Offshore Electricity Transmission and Infrastructure Licence Administration

Under the Act, a Transmission and Infrastructure Licence (TIL) allows the licence holder to:

• assess the feasibility of storing, transmitting or conveying electricity or a renewable energy;
• store, transmit or convey electricity or a renewable energy product in or through the licence area;^[1] and
• construct, install, commission, operate, maintain and decommission offshore renewable energy infrastructure or offshore electricity transmission infrastructure in the licence area.

The draft Guideline provides details about information that should be submitted with a TIL application, some of which is very detailed. The information includes:

• any potential crossings with existing infrastructure and plans to mitigate and manage these activities and risks, including a schedule for consultation;
• information on the cable system – number of cable lines, placement including spacing;
• information on the core design, burial depth and method; and
• information on Offshore Substation Platforms – number, design, capacity, location (if within TIL licence area).

The draft Guideline also includes guidance on how the Minister^[2] will assess a TIL application. It confirms the Minister’s assessment will consider the full scope of the offshore infrastructure project for the TIL, including scoping/planning and design, final investment decision, construction, commissioning, operation and decommissioning.

The Minister must be satisfied the applicant has the technical and financial capability to carry out the offshore infrastructure project. This may involve assessments of technical advice and financial resources available to the applicant. Notably, at a minimum, the applicant should have funds in place for at least 150% of the estimated cost of the proposed work for the next 12 months of the licence term.

The Minister’s assessment will also consider the applicant’s other project interests in Australia and internationally, which may impact the person’s ability to deliver the offshore infrastructure project within a reasonable time.

In addition, the Minister must be satisfied the applicant is suitable to hold a TIL and that the offshore infrastructure project for a licence is in the national interest. These aspects of the Minister’s assessment may involve:

• an assessment of past performance and conduct of the applicant (in Australia or internationally);
• consideration of the proposed project’s impact on and contribution to the Australian economy and local communities; and
• consideration of whether the proposed project is likely to be delivered within a reasonably time and whether the project will make efficient use of the licence area.

The draft Guideline provides that, when sufficient information has been provided by the applicant, the Registrar^[3] will prepare advice for the Minister with a recommendation as to whether a TIL should be offered to the person. The advice may recommend conditions be placed on the TIL and reasons for the conditions. The Minister will decide and advise the Registrar of the decision.

Draft Application Content Guide – Transmission and Infrastructure Licences

The Draft Application Content Guide provides further detail on information to be submitted with an application for a TIL. The information includes:

• applicant structure and governance framework;
• details of previous experience carrying out operations and works that will be authorised by the TIL;
• details of previous financial experience and financial statements, including evidence there’s sufficient funding in place to meet at least 150% of the estimated cost of the proposed works for the first 12 months of the TIL term; and
• an overview of key personnel responsible for the project, including where the applicant intends to rely on contractors or consultants.