Powering progress: How to move from community opposition to renewable energy opportunity

The terminology of ‘social license’ suggests a privilege to be earned. The opportunity for proponents of new energy transmission projects is to think instead about how benefits should be shared.

The benefits of transmission for Australia are lower-cost, more reliable renewable energy that will help us reduce emissions and meet our net zero targets.

But what are the benefits for individual communities that host transmission lines? Thus far, most project proponents have struggled to offer a compelling answer or attractive value proposition to communities.

Consumers don’t have a vote in Australia’s energy regulatory scheme. But consumers can often stop a regulatory scheme from functioning.

Power struggles and social license in the spotlight

Most of Australia’s renewable energy generation will be built at a distance from our capital cities, requiring an estimated 10,000 kilometres of new transmission infrastructure by 2050. Recent analysis published in June 2024, shows that all but one transmission line project has suffered delays. Some projects are more than five years behind schedule.

The latest thought leadership paper from the EY Net Zero Centre, Powering progress, examines the obstacles that stand in our way. These include supply chain challenges, labour constraints, and the regulatory and planning process to obtain approvals.

Transmission projects have been subject to community opposition. Take AusNet’s proposed 190-kilometre overhead transmission line, Western Renewables Link, which would distribute renewable energy generated in regional Victoria to homes in Melbourne. Whilst the Victorian Supreme Court ruled against an opposing community group in December 2023, the media attention has been far from favourable. The Victorian government is now looking to diversify its renewable generation mix to include offshore wind options.

From gridlock to green light through community engagement

The Australian Energy Market Commission’s 2023 review underscores the importance of social license, noting “the regulatory process for new transmission projects must be improved to strengthen social license and speed up the multi-billion-dollar expansion of the grid that is critical to the transformation to cleaner energy.”

Similarly, the Australian Energy Regulator is currently refining its approach to social license and, after consultation, is updating its guidelines and instruments.

Securing and maintaining a strong social license to operate is especially important when engaging with Traditional Owners and Indigenous groups.

The Energy Charter’s best practice guideline builds a shared understanding of the impacts and potential benefits of hosting energy transmission infrastructure. Co-developed by landholder and community groups, alongside electricity transmission businesses, the Guideline offers practical solutions – including land use management, cultural, environmental and economic risk assessments, and engineering design – to address negative impacts.

Winning hearts and minds in the Hunter

The Hunter Transmission project (HTP), one of AEMO’s (Australian Energy Market Operator) priority projects, has recently been redesigned after receiving more than 250 submissions from the community. HTP is a good example of how new transmission is required as part of the transition to reliable, low-carbon energy. It will provide the new 500kV transmission infrastructure needed by 2028 as coal-fired power stations retire, transporting electricity from the New England and Central-West Orana Renewable Energy Zones to homes and businesses in the Hunter, Sydney and Illawarra.

The redesign focuses on how this should be done. According to EnergyCo’s Chief Executive James Hay, “the need for the HTP itself isn’t in question”. But community consultation did emphasise a “clear top priority” was “protecting the environment and biodiversity”. This was “closely followed” by measures to protect Aboriginal cultural heritage, particularly in the state forests, impacts to private land and protecting scenic landscapes”.

The revised route allows 85% of new infrastructure to be on power station, government and mining land. The number of potentially affected private landowners has been reduced from 78 in the preliminary corridor to fewer than 25 in the revised corridor.

EnergyCo will construct a new substation on a site in the Olney State Forest that was previously used for growing commercial timber. This will reduce the corridor by around 15 kilometres. The revised corridor also minimises impacts in parts of the state forests that are culturally significant for the Aboriginal community and traditional owners, including scenic landscapes or sightlines.

The redesign seems to have largely addressed community concerns, and the community discussion has largely gone off the boil since the revised route was announced.

Looking beyond the lines to ensure benefits are shared

Proponents of transmission projects need to ensure construction and ongoing operations provide local benefits, and to pay more attention to communicating these benefits without spin.

CSIRO’s survey of 6,700 Australians’ attitudes to the energy transition – the largest survey of its kind to date – suggests a way forward. This found the top priority for Australians is more affordable energy for everyone, followed by increasing our nation’s energy self-reliance and reducing carbon emissions. Communicating how transmission projects will meet these objectives is, therefore, the place to start.

CSIRO’s survey indicated that people living in regional areas were more negative towards the transition in general, and transmission lines in particular, than those in metropolitan areas. CSIRO found people didn’t always recognise why transmission lines were crucial to the renewable energy transition. When they did understand the role of transmission in the energy transition, they were more likely to accept it.

CSIRO found communities want comprehensive and transparent information on renewable energy infrastructure developments, including the benefits and potential drawbacks of projects.

Social license can be largely resolved through a better process. It is not that people in regions are fundamentally disadvantaged by transmission projects. But the rules haven’t encouraged appropriate benefit sharing.

Our analysis shows transmission projects can, if they choose, provide significant benefits to communities. The key is to be upfront about risks and opportunities, and to commit to benefit sharing and to giving people the facts.

Download EY’s latest thought leadership paper, Powering progress: How Australia can fast-track energy transmission projects for a renewable future.

This is the second in a three-part Energy Infrastructure Executive Briefing Series, Stepping Up to Drive the Step Change, developed by the EY Net Zero Centre. This series explores three critical levers that Australia must pull to decarbonise our electricity grid and drive down the cost of energy to consumers.

http://www.ey.com/au/energyinfrastructure

The views expressed in this article are the views of the author, not Ernst & Young. This article provides general information, does not constitute advice and should not be relied on as such. Professional advice should be sought prior to any action being taken in reliance on any of the information. Liability limited by a scheme approved under Professional Standards Legislation.