The project, considered by the state government as “critical for NSW’s energy security”, involves building a new above-ground 500 kilovolt (kV) transmission line of around 100 kilometres between Bayswater in the Upper Hunter and Olney in the Lower Hunter to connect the state’s existing 500 kV transmission lines.

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When complete, the high-voltage line will transport electricity from the state’s largest renewable energy zones to homes and businesses across NSW.

Following the signing of the agreement, Transgrid will work with EnergyCo as the project is developed and as design and construction contractors are procured.

According to EnergyCo, the project will be delivered with a “Hunter-first policy”.

“Opportunities will be created to build on the Hunter region’s diverse economic skill base and grow local jobs,” a statement from the state-owned energy authority said.

“Around 700 people will be needed during construction including labourers, engineers and electricians.”

EnergyCo is finalising tender documents to be issued to shortlisted contractors.

Energy Co Chief Executive Hannah McCaughey said the Hunter Transmission Project must be delivered to “unlock reliable energy supply to power the state”.

“The commitment deed is a significant milestone that allows EnergyCo and Transgrid to work collaboratively on project planning and approvals.

“By creating a new 500 kV transmission line and connecting it to existing infrastructure, the HTP will form the backbone of NSW’s future electricity grid.

“This will enable the Hunter region to play a key role in our renewable energy future while driving economic growth.

“The announcement of seven shortlisted tenderers for the project marks a significant milestone in delivering critical infrastructure to secure NSW’s energy needs.”

Transgrid CEO Brett Redman said the HTP is one of the state’s most critical energy projects, unlocking generation from new renewable energy zones and helping to provide energy security for the state as coal-fired power stations retire.

“We welcome EnergyCo’s vote of confidence in Transgrid as it plans this critical transmission link, which will help accelerate the clean energy transition and provide access to cleaner and cheaper energy to households and businesses,” he said.

“The Hunter has been at the heart of our energy industry for decades and we look forward to continuing to work with the local community as the region continues to play an important role in the state’s clean energy transition.”