Farmers for Climate Action (FCA) appreciates the opportunity to provide a submission on the 2025 Draft Victorian Transmission Plan.
Key Points
- FCA welcomes the release of the Draft Victorian Transmission Plan. We thank VicGrid for their proactive and ongoing engagement with FCA on the development of the plan.
- We note the investment VicGrid has made to ensure community and landholder feedback is captured through consultation and incorporated into the Plan. This represents a significant improvement on historic consultation.
- The clean energy shift is already providing farmers and farming communities with urgently needed drought-proof income. This income is part of over $8 billion in payments that will be made to farmers hosting clean energy infrastructure between today and 2050.
- FCA poll data conducted by respected polling firm 89 Degrees East shows that more than 70% of regional Australians, including 66% of regional Victorians, support renewable energy on local farms.
- Improved landholder payments and community benefits provided by Transmission Service Providers and the Victorian Government are welcomed. These payments provide guaranteed income to landholders that contribute to their farms remaining profitable well into the future.
- FCA notes ongoing concerns that relate to the tax treatment of transmission hosting and compensation. FCA calls on the government to declare payments to landholders for hosting transmission as tax exempt.
About Farmers for Climate Action
We represent farmers, agricultural leaders, and rural Australians who want to see Australia adopt strong climate policies to protect farmers and farming communities. Our members include more than 8,400 farmers across Australia and 80,000 community supporters committed to reducing emissions across the economy this decade.
Farmers for Climate Action welcomes the release of the Draft Victorian Transmission Plan. This plan is a key element of Victoria’s progress toward a clean energy future that is less reliant on pollution-intensive electricity production and that creates new economic opportunities for farmers and farming communities. FCA thanks VicGrid for their continued engagement and consultation with our team and farmer members whilst progressing the development of the plan. FCA strongly believes in the importance of community consultation, reflected in our industry survey Renewable Energy on Farms. In this survey of 300 farmers, 44% indicated that their communities would be more supportive of transmission infrastructure projects if more extensive and genuine community consultation was undertaken. FCA has previously noted our Victorian farmer members’ negative experiences with transmission network service providers (TNSPs). VicGrid, in progressing consultation on this plan, is clearly working to restore and build trust through enhanced engagement with landholders and the community. FCA acknowledges VicGrid’s presence at regional field days, co-location of staff in communities, and the extension of online engagement with farmers and regional Victorians. This investment has strengthened the perception that the government is actively listening and intending to build social license through adequate consultation for renewable energy and transmission infrastructure across Victoria.
Landholder Payments and Community Benefits
The renewable energy shift is already well underway in Victoria and across Australia. This shift is providing landholders with a secure stream of income that contributes to farm profitability in the face of climate-related impacts such as drought and floods. In 2024, FCA, in collaboration with the Clean Energy Council, released Billions in the Bush. This research report highlighted that from 2024-2050, landholders across Australia will receive over $8 billion in direct payments for hosting renewable energy projects. In Victoria alone, landholders are expected to receive over $1.5 billion in direct payments, and communities are expected to receive over $300 million in community benefits. FCA notes this Plan’s mention of new Renewable Energy Zone Community Energy Funds to be released in the coming months, and looks forward to engaging further on how the right community benefits will flow from the clean energy shift. Further to the economic opportunity presented to farmers by hosting large-scale solar and wind, FCA highlights the improved landholder payments for hosting transmission infrastructure. Specifically, the improved Victorian government payment rate of $200,000 per kilometre of new transmission easement hosted over 25 years, and the increased landholder payment offered by Transport Network Service Providers. These payments ensure that landholders are adequately compensated for hosting transmission infrastructure.
Community and Landholder Sentiment to Clean Energy Infrastructure
Support for renewable energy projects on farmland is strong around Australia, including in renewable energy zones in Victoria. Recent polling commissioned by FCA and published in our Renewable Energy in Farming Communities report found that more than 70% of Australians living in Renewable Energy Zone (REZ) communities support renewable energy projects on farmland. This figure was 66% in Victoria. The polling noted that only 17% were opposed, and 12% either did not know or had no opinion. This data clearly demonstrates that a quiet majority of people living in regions that are key to the clean energy shift support the required projects and infrastructure hosted on farmland.
This report noted that sentiment towards renewable energy was more positive than sentiment towards transmission infrastructure. Improving this sentiment is critical to advancing the clean energy shift. FCA has noted in our submission Enhancing Community Engagement in Transmission Building Rules, that negative sentiment from some farmers and community members has been driven by historic poor consultation and inadequate landholder benefits. VicGrid has made efforts to address both concerns through this Plan.
Tax Treatment of Transmission Hosting Compensation
FCA calls on the government to declare payments to landholders for hosting transmission as tax exempt. FCA’s farmer members in Victoria have expressed concern that landholder payments from the Victorian Government and TNSPs may create a tax liability to the Australian Taxation Office. Taxing landholder payments at prevailing income tax rates of up to 45% on a land sale removes almost all incentive for hosting transmission infrastructure, and is likely to create further disillusionment among landholders. FCA would welcome any clarification that can be provided about the tax status of these payments.
The 2025 Victorian Transmission Plan will ensure that Victoria has the right infrastructure, in the right places, to meet future clean energy needs. FCA again notes that this plan has been informed by consultation with landholders and communities, and goes a long way to ensuring that farmers can fully benefit from the once-in-a-generation opportunity that the clean energy shift represents.
