On 20 December the Basslink power cable (HVDC) which links mainland Australia to the island state of Tasmania failed.
Investigation thus far suggests that the fault is offshore approximately 100km (60 miles) north of Tasmania and is not a fault with on-shore equipment at either end as was initially assumed. The underlying cause is unknown at this stage.
An international team involving experts from Italy and a ship from New Zealand is being assembled to carry out further investigation and repairs. Suggested time at this stage to restore the link is about 2 months (noting that the extent of the damage is presently unknown).
Basslink is the second longest undersea HVDC link in the world and has been in service since 2006. It is the only electrical link between Tasmania and mainland Australia.
All electricity load is at present still being supplied however the failure increases vulnerability on both sides since electricity is normally sent in either direction on an "as needed" basis.
Tasmania can meet its peak demand from local hydro generation but needs supply (generally taken overnight) from the mainland states to avoid overuse of water resources. The loss of the link will thus slowly drain the lakes unless rainfall is above average (recent months have been extremely dry however).
A mothballed gas-fired plant in Tasmania, the only fossil fuel power plant in the state, is being returned to service as soon as possible (estimated to be ready mid-January) which will replace about 45% of the power that was previously coming in via the cable. Depending on the weather, this may or may not be sufficient to stabilise water reserves but it will at least slow the rate of decline.
The mainland states of Victoria and South Australia, including the cities of Melbourne and Adelaide, rely to a modest extent on supply from Tasmania during times of peak demand, noting that demand in those states peaks at a very different time (Summer) when compared to Tasmania (Winter) such that sharing of generating capacity via the link is a practical option. Whether or not any supply problems occur in Victoria and SA will depend on the weather (temperature), reliability of generating plant in those states and the extent of wind generation during any major demand spike.
So overall there's some uncertainty as to the practical effects however loss of the link certainly does increase vulnerability if something else were to go wrong.