A "transformative, nation-building" energy project has been given the environmental green light to proceed, but risks dimming a premier's electoral hopes.
The multi-billion-dollar Marinus Link cable will boost electricity transmission between Tasmania and Victoria and is seen as pivotal in increasing green energy investment.
Tasmanian Premier Jeremy Rockliff signed up to the joint Victoria and Commonwealth investment contract on Friday, while in caretaker mode and a day before the deadline.
The federal government on Sunday lifted another hurdle for the construction and operation of the 1500 megawatt undersea electricity and fibre optics cable.
"The Albanese government has given environmental approval to a transformative, nation-building project which will generate jobs and investment for Tasmania and Victoria while unlocking clean and reliable energy," Environment Minister Murray Watt said in a statement.
Construction of stage one, a 750-megawatt undersea cable, is expected to start in 2026 and finish in 2030.
It will have enough power to supply 750,000 homes and enhance internet connectivity.
It comes as the final makeup of Tasmania's parliament was decided after a snap election, with 14 Liberals, 10 Labor, five Greens, one Shooters, Fishers and Farmers MP and five independents elected.
Major parties are intensifying negotiations with the crossbench to form another minority government as they attempt to secure the required 18 parliamentary votes needed to govern.
But Labor, the Greens and several independents have lashed Mr Rockliff over what they say was a "sham" process to green-light the Marinus Link.
Non-Liberal MPs were given a confidential briefing on the project on Tuesday, while the whole-of-state business case was not released before the deal was signed.
Craig Garland, one of four independents on the cross bench, has ruled out supporting a Liberal government over their "secret" rushed decision.
Independents Kristie Johnston and Peter George were also critical of the process, with the latter saying Mr Rockliff was undermining the prospect of a full-term, well-run minority government.
Greens leader Rosalie Woodruff said the premier's decision to proceed with one of the nation's biggest projects with little consultation showed he was incapable of genuinely working across the parliament.
Labor's Sarah Lovell said the decision was at odds with the premier's promise of transparency.
Mr Rockliff said the deal had capped Tasmania's equity share at $103.5 million - 4.27 per cent of the project's cost.
However, the business case forecasts an increase in state net debt to $19 billion in 2031/32 as a result of the project.
