A new agreement secures the Victoria/Tasmania Marinus Link undersea power cable project.

The deal, following Tasmanian government's threat to withdraw support due to cost concerns, was designed to maintain project momentum.

Key amendments have been made, including a requirement to reduce from two cables to one, with discussions on a second cable.

Tasmania's contribution has been dropped by nearly half, while the Commonwealth and Victoria retain their commitments.

Additionally, Tasmania will be allowed to sell its stake to the Commonwealth upon project completion.

Part of Tasmania's energy strategy, Marinus Link is in the top five priorities of the Australian Energy Market Operator. It is seen as a vital part of Tasmania's renewable energy plan, backed by hydro and wind power.

However, some have expressed concerns about transparency and the timing of the announcement, calling for cost-benefit analysis.

State-owned operator Hydro Tasmania has welcomed the deal. The Tasmanian Chamber of Commerce and Industry is hailing it as a victory for businesses.

Analysts warn Tasmanians may face a 10 per cent increase in bills from 2028 due to network costs, as Marinus Link may face competition from local batteries.