Landowners in Victoria with properties near new transmission lines and towers could be in line for payments of up to $40,000 under a government proposal.
Government agency VicGrid is seeking consultation on the plan which would only apply to "significantly impacted neighbours" of new transmission and renewable energy infrastructure.
The draft plan states payments could be made to neighbours with "demonstrated significant loss of visual amenity" within 400 metres of infrastructure in regional areas and 200m in urban areas.
"Infrastructure would need to be clearly visible from the point of the dwelling, home occupation or other site of sensitive land use," it states.
The document also explores 'exceptional circumstances' payments above the proposed threshold if towers impact culturally significant sites or lead to a loss of income for hospitality and tourism businesses.
Victorian farmers have staged several high-profile protests against towers being built along the route of the upcoming VNI West and Western Renewables link projects.
The projects are part of a move to shore up energy stability across the east coast, with power generated in Victoria and NSW able to be transferred between states.
Part of the route will include transmission towers about 80 metres high carrying high-voltage powerlines.
Landowners with transmission equipment on their property will be paid $200,000 per square kilometre over 25 years.
Victorian housing minister Harriet Shing said the proposed neighbour payments recognise the impact to communities and were raised during extensive consultation.
"This fund and this co-design (with) communities plays a really important role in developing, securing and maintaining the social license that is necessary to be able to do this work," Ms Shing told reporters on Sunday.
"It's only fitting that we make an investment into the communities where that impact is being felt."
Opposition spokesman Brad Rowswell backed compensation and agreed transmission lines would need to be built, but questioned why it had taken so long to put the scheme forward.
"I don't begrudge farmers who are overseeing productive farming land wanting some sort of compensation from the government," Mr Rowswell said.
"Where possible transmission lines should not impact in such a severe way as this state government is proposing."
Submissions on the plan close on June 25.
