VNI West (Victoria to New South Wales Interconnector West)

August 2026 Update

VNI West is a new high-capacity 500 kV double-circuit overhead transmission line that will connect the Victorian and New South Wales electricity grids, carrying renewable power from renewable energy zones (REZs) in both states in particular the Western Victoria and Murray River REZs. The line will run from a new terminal station at Bulgana in western Victoria to a new terminal station near Kerang, before crossing the Murray River and continuing to Transgrid's Dinawan substation, north of Jerilderie in the NSW Riverina. Once energised, the interconnector is expected to add approximately 1.9 GW of export capacity from Victoria to NSW and 1.67 GW in the other direction.
The Victorian section is now being delivered by VicGrid, which assumed responsibility for the project from AEMO's subsidiary Transmission Company Victoria in late 2025, with Iberdrola Australia engaged as delivery partner. Transgrid remains responsible for the NSW section. The preferred easement is approximately 70 metres wide along most of the route.

The project has moved well beyond the route-selection stage and is now deep in its environmental approvals, with easement negotiations underway along the corridor. In New South Wales, the Environmental Impact Statement (EIS) for the NSW section was placed on public exhibition in August 2025 and the project is currently in the assessment stage with the Department of Planning, Housing and Infrastructure, with a determination expected in late 2026. In Victoria, the Minister for Planning issued final scoping requirements for the Environment Effects Statement (EES) in February 2025. Technical studies across biodiversity, cultural heritage, landscape, water and agriculture are underway, with public exhibition of the EES expected in late 2026. Subject to approvals, construction is anticipated to commence in 2027, with the project now targeting energisation in November 2030 — a revised delivery date announced in mid-2025. For landholders along the route, this means the compensation conversation is happening now. Both proponents are actively negotiating option agreements and easement compensation with affected owners ahead of construction.

Compensation

Landholders whose properties are traversed by the easement are entitled to compensation in Victoria under the Land Acquisition and Compensation Act 1986 (Vic), and in NSW under the Land Acquisition (Just Terms Compensation) Act 1991 (NSW). Compensation properly assessed should capture not only the diminution in value of the easement area itself, but severance, injurious affection to the balance of the landholding (including impacts on homesteads and improvements from visibility and proximity), disturbance, and reasonable professional fees.
The case law in this area demonstrates why a considered, property-specific assessment matters:
**Kater v Electricity Transmission Authority (NSW) [1996]** concerned a 500 kV transmission line within a 70-metre easement comparable to VNI West. The court applied the piecemeal method, finding a 50% diminution in value to the easement area, with varying rates of diminution applied to different parts of the property and its structures depending on visibility and proximity to the line.
**Longeranong Pty Ltd v Electricity Trust of South Australia (1990)** concerned a 275 kV transmission line easement across pastoral land. The judgment adopted 50% of freehold value for the land "taken" by the easement, and rejected blanket percentage approaches in favour of analysing the specific areas of the property actually affected.
In addition to statutory compensation, both state governments have introduced per-kilometre hosting payments for landholders on new transmission projects, including VNI West. Victorian hosts are eligible for payments of $8,000 per kilometre of transmission hosted per year for 25 years, and NSW hosts are eligible for Strategic Benefit Payments of approximately $200,000 per kilometre, paid in instalments over 20 years and indexed. Importantly, these scheme payments sit alongside and are not a substitute for proper easement compensation. Landholders should not accept an offer on the basis that hosting payments make up for an inadequate assessment of the impact on their property.

Engage Advice Early
In Victorian and New South Wales, the acquiring authority will generally be liable to all reasonable legal and valuation costs incurred by a Claimant as a result of the compulsory acquisition process. There is therefore no reason for a landholder to sign an option agreement or accept a compensation offer without first obtaining an independent assessment.

How Sovereign Valuations Can Help

Sovereign Valuations has extensive experience in compulsory acquisition and easement compensation matters on major infrastructure projects throughout Victoria and NSW, with involvement in projects exceeding $100 million. We act for landholders in assessing and negotiating easement compensation, preparing valuation evidence, and where necessary supporting proceedings as expert witnesses.
If VNI West crosses your property or comes close enough to affect it, contact us on 1300 710 000 or admin@sovereignvaluations.com.au for a confidential discussion.