An action group has branded the state government's compensation offer to landowners hosting transmission towers on their properties as a "band-aid solution."
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HumeLink Alliance member Michael Katz has also repeated calls for TransGrid's proposed 360km transmission line from Maragle to Bannaby to be placed underground.
He was speaking after the state government announced that landowners would be paid $10,000 annually for 20 years for every kilometre of new transmission lines built on their property. Annual payments would be indexed to CPI.
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Deputy Premier and regional NSW minister Paul Toole said the scheme would be the first of its kind in Australia.
"Supporting landowners and regional communities who host this infrastructure will help us build the network we need in time to ensure energy security, supply and affordability for families across NSW," he said.
State energy minister Matt Kean described it as a "huge win" for landowners that would almost double the average payment they currently received.
It would apply to new major transmission projects such as HumeLink and others in the Central West, New England and Hunter regions.
The payment would also come on top of one-off upfront compensation paid to landowners for the acquisition of transmission easements under Just Terms legislation.
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But Mr Katz said if the government was serious about its commitment to build "a modern electricity grid that maximises benefits for communities and households", it should not be based on old, dangerous and inefficient tower technology but go underground.
"Green energy must be about the end-to-end delivery of power to consumers, not just generation," he said in a statement
"The reality is that today's compensation announcement is in effect a subsidy for Transgrid - a foreign owned company - to destroy 2500 hectares of land between Wagga Wagga and the Snowy Mountains to the start of the Southern Highlands."
"We congratulate the NSW government for having the most ambitious renewable energy policy in the nation, which is needed to replace the State's ageing coal fired power stations and build a clean energy future, and will support them to do it properly, by looking at undergrounding as they recently announced they would in Victoria for the Marinus Link project with Federal Government funding support."
Mr Katz argued true green energy transmission should have minimal environmental impact. HumeLink's plan to "replace trees with 85-metre-high carbon intensive steel poles" did not achieve this goal in "most people's thinking."
The Alliance recently joined with the HumeLink Action Group on the Stop, Rethink HumeLink Towers campaign. It urged the government to better compensate landowners for transmission lines but also to explore the best way possible to transmit energy.
Meantime, NSW Farmers energy transition working group chair, Reg Kidd, said while transmission lines were a hot topic for affected landowners, the payments were an important step in recognising the impact energy infrastructure had on farmers.
"Farmers are in the box seat in moving Australia from coal to renewables, with installations and power lines set to criss-cross rural areas, and NSW Farmers has consistently called for recognition of this vital role," he said.
"Rural landowners are key stakeholders in achieving our targets, and they deserve to be consulted and respected. These payments are welcome to deal with the losses in productivity and amenity, and for the contribution to both our state and national goals of reducing carbon emissions."
But he said it was vital that farmers were still consulted early in the piece and due recognition given that rural land's productivity was "drastically reduced" once built upon.
"There are projects out there where farmers have been ignored or pitted against one another, and that's not good enough, we want to see the right thing in the right place - and importantly in the right way - so we can maximise benefit and minimise impact to agricultural production," he said.
"We will not allow this new payment scheme to be used to silence those who are concerned about their property."
NSW Farmers for Climate Action also welcomed the policy, saying it had the potential to bring renewables online faster and give primary producers an alternative income source.
"This is now the benchmark for transmission line payments in Australia and we urge the federal government and all other states to carefully examine this policy," CEO Dr Fiona Davis said.
"We also encourage governments to roll a scheme like this out for all transmission line projects."
Further information on the Strategic Benefit Payments Scheme is available at https://www.energyco.nsw.gov.au/community/strategic-benefit-payments-scheme.
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