This paper outlines a methodology for assessing the reliability and cost of operating multi-terminal High-Voltage Direct Current (HVDC) transmission interconnectors with a comparison being drawn on the benefits of using modular multilevel converters (MMC). The MMCs random failure/repair processes are modelled as either a two-state or three-state Markov processes. A time-sequential Monte Carlo simulation is used to simulate the operation of the modified IEEE Reliability Test System (RTS) with the MMC-HVDC interconnectors, over a one-year period. The RTS accommodates variable wind generation, and the results confirm the use of HVDC as tie lines provide geographical aggregation, allowing for much greater penetration of variable generation in the connected systems. The three-state MMC model, in addition to the binary up and down states, consists of a derated state in which the converter voltage is reduced to 57.7 % of its nominal voltage. The additional state was found to reduce the downtime of the link by 89.6 %, increasing the available flow capacity by 458 GWh/year. The increase flow capacity leads to an increase in arbitrage revenue of euro3.17m per year and a reduction in project payback time of 1.5 years.