When Tasmanian Premier Jeremy Rockliff recently announced a new berth at Devonport to house the two new Spirit of Tasmania vessels likely wouldn’t be completed until February 2027, an exasperated sigh was felt around the state.
The promise of new Spirit ships and the boosted freight and vehicle capacity that will come with them has been on the horizon for some time. Spirit of Tasmania is far more than a tourism company. It’s a crucial cog in the supply chain that connects Tasmania to the Australian mainland, and the further delay to the operation of the new vessels is worth far more than a few disgruntled tourists.
The new vessels – which are aptly named Spirit IV and Spirit V – are almost 20 metres longer, four metres taller and, crucially, have a massive 59.8 per cent increase in lane metres for passenger and freight vehicles than the current active ships, Spirit I and Spirit II.
This added size means the existing berth at Devonport is too small to house the new ships, but problems have marred the infrastructure project since the acquisition of the two new Spirit vessels was announced seven years ago.
A permanent upgrade at 3E Berth to house the larger vessels was meant to be completed in August this year, but will be, at the earliest, two years delayed from that initial timeframe.
The active Spirit of Tasmania vessels currently dock at Devonport’s 1E Berth. The larger size of the new ships mean works have been ongoing to the new location over recent years, however those upgrades are now well over budget and well behind time.
When the berth upgrades were announced they were costed at $90 million and expected to be completed by 2024. Now, that cost has ballooned to $375 million and the earliest completion projection currently has them active in the final quarter of 2026, however 2027 completion is more likely.
As the current berth upgrades have continued to run behind, other solutions have been sought and floated to allow the new vessels to dock as soon as possible, whether that be the utilisation of different Tasmanian ports, or quickfire upgrades to the existing 1E berth, however both of those options have been deemed as unsuitable.
A report titled ‘Berths for New Vessels’ from the Tasmanian Department of State Growth detailed two potential pivots to enable the faster utilisation of the new vessels.
Option one involved issuing or modifying directions to TasPorts regarding modifications to Berth 1E to temporarily accommodate the operation of the new Spirit of Tasmania vessels pending the completion of Berth 3E.
Option two involved taking steps to ensure Berth 3E became operational for the new vessels as soon as possible.
Transport Minister Eric Abetz said the alternative options were scuppered because they were either deemed unsafe, or financially unviable.
“The simple fact is that the harbourmaster … determined that option one would be unsafe,” Abetz said in late-October.
Infrastructure expert Ben Maloney’s co-authored report regarding the potential of a temporary berth upgrade dove deeper into the safety issues involved with option one.
“With the more comprehensive investigations of the simulation of how the vessels would move under various conditions … it was concluded only a week or two ago that the option was unsafe because there was too high a risk of collision with bollards and the like.”
“In relation to option two,” Abetz continued, “the commerciality of that was determined as such that it would not be a viable option, and it would cost the Tasmanian public.”
There was also the suggestion for SeaRoad to be moved from 2E Berth to accommodate Spirit of Tasmania operator TT-Line, but that idea was quickly nipped in the bud due to the disruption it would cause SeaRoad and the resulting costs.
A delayed start time to the construction of the new berth is central to the issue of why the berth was not ready at the initially projected timeframe of August 2024, and issues have snowballed from there. TT-Line claims TasPorts limited its access to the site for almost a full year, however these claims of fault have been disputed by TasPorts. Both are government-owned organisations.
The issue at hand regarding the usability of the new Spirit of Tasmania vessels, inevitably, comes back to money. The rising costs of constructing the new berths, the costs involved with building the new ships, and the future losses involved with the failure to utilise the new ships to their full potential until the berth is constructed.
Tasmanian Labor Leader and Shadow Minister for Tourism and Hospitality Dean Winter has claimed that, should the full six-year delay be endured, $3 billion worth of economic activity will be lost. Winter also says the latest delay until added another $500 million to that figure.
The results of the delays and rising costs have been felt in the boardroom of Tasmania’s government organisations, with TT-Line Chair Michael Grainger forced to resign back in August, and Chief Executive Bernard Dwyer announcing his intention to resign at the expiry of his term in November.
TasPorts Chair Steven Bradford has also resigned ahead of his term expiring in November, while former Infrastructure Minister and Deputy Premier Michael Ferguson resigned in August before leaving from parliament entirely ahead of a vote of no confidence.
Economist and Vice-Chancellor’s Fellow at the University of Tasmania Saul Eslake has also attempted to estimate the large cost to the economy from the delays and has concluded each year’s delay is worth approximately $350 million and 6000 potential jobs will not be created.
“Saul Eslake has estimated the Liberals’ delays in delivering the ships are costing the Tasmanian economy $350 million each year they are late,” Winter says.
Despite the difficult nature of the current standing of the wider Spirit of Tasmania project, the one simple fact that cannot be ignored is the new vessels are coming, and they’re coming soon – so how can the best be made of this certainly less than ideal situation?
Two major solutions were previously floated that would have allowed the economic losses to be somewhat mitigated. One is the leasing of the new ships until the new berth is ready, and the other is to operate the new ships at less than capacity to allow them to utilise the current 1E Berth at Devonport.
Premier Rockliff has said the government will explore the leasing of the new vessels until the berth is ready.
“We need to maximise the opportunity for Tasmania and Tasmanians when it comes to the most sustainable way forward financially and maximising the value of what are considerable assets for Tasmania,” Rockliff said.
“As soon as we have an answer, we will inform the Tasmanian public on the success or otherwise of those leasing options.
“We’ve got to take it forward. We have got to all work together and pitch in to get the job done. We can look back, but we must look forward and do the best we possibly can minimise any brand or reputational damage.”
The other option involved operating the vessels at a lower capacity, but the potential for that was also quickly denied.
Spirit IV is already built and ready to go, while there has been no reported delay or stoppage in the construction of Spirit V, which is due to be completed early next year.
The solution that has been reached has been to store Spirit IV until the infrastructure to properly use it is in place, but how do you effectively put away something so large and complex?
Spirit IV will not be stored in Australia, however – or even Asia – despite there being ports capable of hosting it across the region. Instead, its home for the foreseeable future will be at Leith Port in Edinburgh, Scotland. It will be moved from its Finnish home due to projected poor weather conditions and held Scotland’s largest enclosed deep-water port.
“To ensure the vessel’s safety and preservation, we will temporarily relocate it to Leith, Scotland, where conditions are more suitable,” TT-Line CEO Bernard Dwyer said.
“The move is necessary as the vessel is not designed for the extremely low ambient temperatures anticipated in Rauma.”
Rockliff has said the best decisions possible will be taken to minimise the negative impact on Tasmanian industry.
“We look forward to ensuring that our Spirits are sailing up the Mersey River as soon as possible, but in the meantime, all the decisions that we will be making will be in the best interest of taxpayer funds.”
To offset the inability to use the new ships, more services using the existing vessels will be added over the summer, and potentially beyond, in an effort to recoup the negative financial impacts to the economy.
Work is continuing to find a suitable lessee for the vessels.
But, for now, any improved freight and cargo capacity the new Spirit vessels would have brought the state of Tasmania must remain on hold until at least 2026.
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