"If Tas were to export power to Vic, for example, they would use DC. There would be a secondary advantage that the two grids would not need to be in sinc but you would need big rectifiers in Tas and big DC/AC inverters in Vic. Not a task to be taken lightly."
That's exactly what happens now (http://www.basslink.com.au/) there is now talk of using Tasmania's hydro dams as energy storage for Victorian wind farms. Pumped hydro is one of the cheapest energy storage systems available.
