The slated $2 billion sale of Victoria's stake in the Snowy Hydro project has in-principle bipartisan support in Spring Street, but it's unclear exactly how the windfall would be spent.
The federal government has agreed to buy Victoria's and NSW's respective $2.077 billion and $4.154 billion stakes in the Snowy Hydro, in order to proceed with an expansion to benefit the east coast electricity grid.
In return, the states will have to spend the money on "productive infrastructure".
Victoria's Labor government has labelled the sale, which needs parliamentary approval, a "win-win" for the state and Commonwealth.
But Premier Daniel Andrews hasn't decided what infrastructure projects to fund with the money.
"Sending our portion of the Snowy to the Commonwealth - allowing them to get on and do that important work - that's not only of benefit to the Victorian budget and Victorian taxpayers, but Victorian energy consumers will benefit from that as well," he told reporters on Friday.
"In terms of where that $2 billion will go, we'll have more to say about that."
The sale has in-principle support from Victoria's Liberal-National opposition, but treasury spokesman Michael O'Brien says they want more detail.
"We need to be assured that our farmers and irrigators, those people who do rely on the Snowy system, will be looked after," he added.
Mr Andrews assured voters the sale wouldn't have any adverse impacts on water entitlements.
The $4.5 billion Snowy Hydro expansion is designed to boost the capacity of the iconic scheme by 50 per cent but isn't due to be finished until at least 2024.
Federal Energy Minister Josh Frydenberg said the sale will ensure the Snowy remains in public hands.
"Nobody can bind future governments but I don't think it's in the interests of any future governments, whatever their political persuasion, to do anything but keep this in public hands," he told ABC radio.
Opposition Leader Bill Shorten wanted to see the business case for "$6 billion of federal taxpayer debt".
He said the government needed to provide long-term policy certainty to boost renewable energy investment and drive down house prices.
