THE state and federal governments have inked a deal for an electricity superhighway linking Bendigo to northern Victoria's growing fields of solar panels.
The agreement on the early stages of the major "KerangLink" electricity network overhaul has won plaudits from councils north of the city, where sunny skies have already attracted millions of dollars in large scale solar energy projects but lack transmission lines to handle future loads.
A swathe of renewable energy projects across the country are expected to help replace ageing coal-fired power stations, most of which will close over the next 15 years.
The nation's electricity network needs major upgrades to shift away from a handful of coal-fired power stations if Australia is to reach its national and state renewable energy targets, a 2020 Australian Energy Market Operator road map for upgrades found.
The system would likely rely on a myriad of renewable energy stations across the country to guarantee supply.
North of Bendigo, projects capable of supplying 4000mw of renewable energy - nearly double the amount Victoria's largest coal fired power station, Loy Yang A - are already operating, being built or have planning approval.
That includes central Victoria's Loddon, Campaspe and Gannawarra shires, Murray River Group of Councils chair Bill Moar said.
"This project will help to unlock the enormous potential of northern Victoria to generate renewable energy and to deliver it across South Eastern Australia," he said.
KerangLink will effectively become the connection between New South Wales and Victoria's energy grids and run from the Murray River through Bendigo to Ballarat.
It will link Victoria up with power storage and batteries including Snowy Hydro 2.0, the federal government's mammoth renewable energy project being built in New South Wales.
They will release power into the grid when demand is high, shoring up reliability for a system that will rely in part on wind and sunshine that cannot be generated 24/7.
Murray River Group executive officer Geoff Turner said the KerangLink would increase the capacity of power lines through the area.
"A lot of investment in projects in this area have been held up because of a lack of transmission line capacity," he said.
Mr Turner is aware of four new projects that investors could push with more confidence now that the KerangLink deal has been made, potentially doubling the amount of renewable power flowing through and out of the region.
The state and federal deal would help get upgrades done by 2027.
The state and federal government will underwrite the costs, under the newly signed deal.