Offshore wind gets the green light in Australia

Offshore wind gets the green light in Australia

The Star of the South, a 2GW installation of up to 200 wind turbines, has moved a step closer to becoming Australia’s first offshore wind project. This follows the announcement of Federal Government support for a feasibility study for the project, which would be located 7-25 km off the south coast of Gippsland, near towns such as Port Albert, McLoughlins Beach and Woodside Beach in the State of Victoria.

Reasons for the site’s selection include the strong, consistent wind conditions in the Bass Strait, investor interest and support from the state government.

There are also well-defined plans for grid connectivity. The proposed solution includes a transmission network of cables and substations to connect the offshore wind farm to the Latrobe Valley, described by the project team as “one of the strongest grid connection points in the National Electricity Market” (the NEM; the wholesale electricity market and physical power system which supplies New South Wales, the Australian Capital Territory, Queensland, South Australia, Victoria and Tasmania). For transmission, the team intends to use underground cables for most of the task, except where these are technically unfeasible or where overhead lines would have lower impacts.

The Star of the South has the potential to supply power to 1.2 million homes, and up to a fifth of Victoria’s electricity needs. Over its lifetime, it is expected to create around 2,000 direct jobs in the state. This includes 760 jobs in Gippsland during the construction phase and 200 ongoing jobs once the project is live. In total, around A$8.7b would be invested in Victoria, an estimated A$6.4b of which would go into the Gippsland economy.

Darren Chester, Federal Member for Gippsland, said that the announcement is good news for the area, with the proposed Star of the South project expected to support local jobs and increase renewable energy infrastructure.

“This first step will help to ensure the area is suitable for offshore wind developments and has appropriate safeguards to protect local marine life and the surrounding environment. I look forward to seeing the outcome of the assessment and the progress of the project,” he continued.

Offshore Electricity Infrastructure Act

Offshore wind will contribute to Australia’s goal of reaching carbon neutrality by 2050 and the Offshore Electricity Infrastructure Act provides a framework for granting licences to undertake offshore electricity infrastructure activities in Commonwealth offshore areas.

On 22 March 2022, the Federal Government released draft regulations for the Offshore Electricity Infrastructure framework for public consultation. These set out operational arrangements, including the licensing scheme, fees and levies. The consultation period ran until 22 April 2022.

Once the Offshore Electricity Infrastructure Act 2021 commences this month (June 2022), the Federal Government will evaluate and announce further areas for development as they are identified and prioritised.

Assessments will look at the effects of offshore renewable energy infrastructure activities, with particular focus on the environment including marine life and migratory birds, fishing, shipping, other marine uses, and local communities. 

The announcement is therefore but the start of a process. Further assessment work will follow, including consultation with important stakeholders — ensuring local communities can have their say is critical in terms of public credibility and gaining acceptance, and there is a minimum 60-day public consultation period.

In the wider context, a technology-focused Federal Government plan is supported by a further $1.3 billion of new investment in the 2022-23 Budget to maintain energy security, and keep downward pressure on electricity prices while reducing emissions.

Wealth creation

Tim Wilson, Assistant Minister to the Minister for Industry, Energy and Emissions Reduction, has stated that the Federal Government is implementing Australia’s first Offshore Electricity Infrastructure framework in order to enable a new industry to emerge — and to secure affordable energy, jobs and investment as part of building Australia’s clean industrial future. 

“The Federal Government is backing the creation of an Australian offshore wind industry by identifying priority areas for assessment,” Wilson said. 

“We’re pressing down on the accelerator and delivering a pathway to decarbonisation.

“Our government understands that a strong offshore energy sector can help provide clean and affordable power to households, businesses, and industrial consumers.

“An offshore electricity industry could create thousands of new jobs and drive the economic growth of our regional and coastal economies.”