The Project Specification Consultation Report (PSCR) represents the first step in the application of the Regulatory Investment Test for Transmission (RIT-T) to options for addressing environmental, safety and reliability risks caused by age-related condition issues of two transformers and the 44 kilovolt (kV) switchgear at Rosebery Substation in TasNetworks.
Rosebery Substation currently operates with three transformers, two of which are 36 megavolt ampere (MVA) transformers (T1 and T2). T1 and T2 are 110/44-22 kV transformers that were manufactured in 1968 and commissioned later in that year. Consistent with assets nearing the end of their technical lives, the health-based assessment utilising the industry accepted Common Network Asset Indices Methodology (CNAIM) rates the assets as poor with increasing asset risk. These asset conditions pose a risk to the reliability of supply to customers served by Rosebery Substation because transformers are used to change higher voltage electricity to a lower voltage for transportation through the distribution network.
The 44 kV switchgear at Rosebery Substation is also nearing its end of life. Switching constraints are emerging as the ageing switchgear is often out of service, leading to a risk of unserved energy. The circuit breakers are subject to increased risk of leaks and failure, leading to increased unplanned corrective maintenance accompanied by environmental and worker safety risks. These assets are also time-consuming and expensive to repair and replace because the 44 kV network in North-West Tasmania is unique in Australia.
Rosebery Substation supplies electricity to the local Rosebery community and to Trial Harbour Zone Substation (which feeds Zeehan). It also supplies mining customers (MMG mine and Bluestone) and is the only 44 kV injection point in the network, with MMG mine being supplied via a dedicated 44 kV feeder. It supplies approximately 40 megawatt (MW) of load in total. In the event of failure of two transformers, the substation would be able to supply a maximum of 36 MW from one remaining transformer. Such a scenario would lead to involuntary load shedding until a system spare is commissioned, which is likely to take up to 18 months given that there is no spare 44 kV transformer at present.
TasNetworks has identified an opportunity to increase market benefits by addressing reliability, financial, environmental and safety risks associated with ageing transformers and switchgear at Rosebery Substation.
If action is not taken, the condition of the T1 and T2 transformers and 44 kV switchgear at Rosebery Substation will expose us and our customers to increasing levels of risk going forward, as deterioration increases the likelihood of failure.
Under the ‘do nothing’ base case, there is an increasing risk of transformer and switchgear failure. Such incidents pose significant reliability risks due to unserved energy and environmental risks through oil leaks. There may also be serious safety consequences for nearby residents and members of the public, as well as our field crew who may be working on or near the assets. Additionally, these incidents carry financial risk associated with the increased cost of emergency reactive maintenance or replacement.
Addressing the condition issues of the transformers will enable us to manage reliability, financial, safety and environmental risks at Rosebery Substation. TasNetworks expects that addressing these issues will result in significant market benefits and, as such, we consider the identified need for this investment to be market benefits under the RIT-T.
TasNetworks consider that there are three credible options from a technical, commercial, and project delivery perspective that can be implemented in sufficient time to meet the identified need. Each credible option involves replacement of the ageing T1 and T2 transformers and 44 kV switchgear. The options vary based on the location of the replacement transformers and the timing of investment. Specifically:
- Option 1 involves the replacement of T1 and T2 transformers and the 44 kV switchgear in the 2024-2029 regulatory control period (R24);
- Option 2 involves installing two new transformers at Farrell substation in R24; and
- Option 3 involves the replacement of T1 and T2 transformers and the 44 kV switchgear in the 2029-2034 regulatory control period (R29).
All three credible options are found to have positive benefits for all scenarios investigated. Option 1 is expected to deliver the greatest net economic benefits across all scenarios investigated. On a weighted basis, the net economic benefits of Option 1 are approximately $14.4 million, which is 7.8 per cent greater than the net economic benefits of the second-ranked option, Option 3 (with net benefits of approximately $13.2 million).
Option 1 is the preferred option because it is expected to maximise net economic benefits on a weighted basis. In addition to having the highest net market benefits (based on weighting the scenarios considered), Option 1 is preferred over Option 3 for the following reasons:
- Option 1 is already ranked above Option 3 even though we have not applied real cost escalation to the costs of Option 3 despite construction commencing later – some degree of cost escalation is likely and would increase the extent to which Option 1 results in higher net economic benefits relative to Option 3; and
- TasNetworks is expecting additional mining load in the area in the near-to-short term, meaning earlier investment will support accommodating that increased load in the network without risk of even greater unserved energy in the future.
The PSCR has found that Option 1 is the preferred option at this draft stage of the RIT-T. Option 1 involves the replacement of both T1 and T2 transformers and 44 kV switchgear in R24, commissioning the assets at the end of this regulatory control period, R24. The estimated capital expenditure associated with Option 1 is $24.1 million (in 2024/25 dollars).
The PSCR is published in TasNetworks website which can be accessed www.tasnetworks.com.au.
TasNetworks welcome written submissions on materials contained in the PSCR. Submissions are due on 30 October 2025. Submissions should be emailed to the Regulation Team via [email protected]. In the subject field, please reference ‘Rosebery PSCR’.