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Offshore wind – a key pillar in our renewable energy future

Victoria is undergoing a once-in-a-generation energy transition. As Victoria's ageing and increasingly unreliable coal-fired power stations retire, more and more renewables – paired with battery storage - will provide the State's electricity as part of our renewable energy transition. From our sun-drenched plains to our windy coastlines – Victoria is blessed with rich renewable sources that will help us achieve our renewable energy target of 95% by 2035.

Offshore wind energy is a key pillar in this renewable energy transition. – and reaching our renewable energy targets. Victoria's offshore wind energy generation targets, legislated in March 2024, are:

  • at least 2 gigawatts (GW) of offshore generation capacity by 2032 – enough to power 1.5 million homes
  • 4 GW by 2035
  • 9 GW by 2040.

Offshore wind will:

  • create new jobs and career pathways,
  • boost Victoria's manufacturing and supply chain development,
  • increase regional investment, and
  • support for our climate action goal of net-zero emissions by 2045.

What is offshore wind energy?

In Australia, offshore wind farms will be located in Commonwealth waters. The wind farms capture the energy of the wind and convert it into electricity. Winds are usually stronger and more constant over water than over land, meaning we can generate more electricity from these farms.

How an offshore wind farm works

  • Offshore turbines capture the wind's energy and generate electricity. These turbines are larger and more powerful than onshore wind turbines. The blades can be over 100 metres long and are made to endure high winds.
  • Foundations secure turbines to the ocean floor. Foundations can be fixed-bottom (anchored to the seabed) or floating (moored to the seabed in deeper waters).
  • Cables transport the electricity from the turbines to the substations.
  • Offshore substations collect the power generated by the turbines and prepare it for transmission to shore.
  • Onshore substations connect the electricity supplied by the offshore wind farm to the onshore grid.
  • Control systems manage the operation of the turbines, monitor the performance of the substructures and foundations, and ensure the safety of the entire system. These systems use advanced sensors and communication technologies to collect and analyse data in real time.

Offshore wind around the world

Offshore wind energy technology has been used internationally for decades and costs have come down over time. More and more countries are turning to offshore wind as part of their renewable energy transition. Many countries around the world have established offshore wind farms, and Victoria is building on their experiences:

  • Denmark has been a leader in offshore wind energy since the 1990s, when it built the world's first offshore wind farm in Vindeby.
  • The United Kingdom has been a pioneer in offshore wind energy since the early 2000s and is currently the world leader in offshore wind capacity. The country has several large offshore wind farms, including the 1,386 MW Hornsea 2, which is currently the world’s largest offshore wind farm.
  • China has been rapidly expanding its offshore wind energy capacity in recent years, and currently has the third-largest installed capacity of any country in the world.

There is strong global support and coordination around offshore wind – including the Global Offshore Wind Alliance (GOWA), which was founded to create a global driving force for the uptake of offshore wind. Victoria became a sub-national member of GOWA in August 2023.

The process of establishing an offshore wind farm

Before a wind farm can be built, there is a lot of work and planning that must happen.

  • First, an offshore wind farm can only be built in areas approved by the Australian Government. These areas are called declared areas. In Victoria, areas of the Bass Strait off Gippsland, and of the Southern Ocean off western Victoria have been declared for offshore wind.
  • After an area is declared suitable for offshore wind, developers can apply for a feasibility licence. This licence gives them permission to investigate their proposed project in more detail. The feasibility licence applications for the Gippsland region are closed and pending a decision from the Australian Government. Applications for feasibility licences in the Southern Ocean are open and close on 2 July 2024.
  • A commercial licence is the next licence a developer will need. This gives them permission to build the farm – it is only given to developers who have completed all the steps and approvals needed for their feasibility licence.

Learn more about each stage below or visit Establishing offshore renewable energy infrastructure on the Commonwealth Department of Climate Change, Energy, the Environment and Water's website.

Pre-feasibility activity

Even before an area is officially declared suitable for offshore wind, a developer will often start earlier investigations in possible offshore wind areas. This is called pre-feasibility activity and can include:

  • consulting with the community to understand their concerns or opportunities
  • doing assessments on the environment, such as understanding more about migratory birds and marine life in these areas.

Communities in Gippsland and Portland may have already seen some of this developer activity.

Feasibility licence

  • Issued by the Australian Government, the feasibility licence period is up to 7 years.
  • Developers must develop a management plan – as part of this, they need to:
    • consult with the local community and demonstrate how they will share the area with other users
    • have a plan for gathering and responding to ongoing feedback from stakeholders throughout the life of the project.
  • The management plan must be approved by the Australian Offshore Infrastructure Regulator before an application for a commercial licence can be granted.

For the declared area in the Gippsland region, offshore wind developers had until the end of April 2023 to apply for a feasibility licence. The Australian Government is assessing these applications and provided an update on their preliminary consideration in December 2023.

In March 2024, the Federal Minister for Climate Change and Energy announced feasibility licence applications for offshore wind projects in the Southern Ocean region were open until 2 July 2024.

Commercial licence

  • To apply for a commercial licence, developers must have received all other relevant approvals, including environmental approvals.
  • Before deciding whether to grant a commercial licence, the Australian Government may require the developer to conduct specific kinds of consultation.
  • If the commercial licence is granted, which is for a period of 40 years, the construction of the wind farm can commence.

Where will offshore wind farms be located?

Offshore wind farms will be located in Australian waters and can only be built in areas approved by the Australian Government.

Gippsland

In December 2022, the Australian Government declared an area of the Bass Strait off Gippsland as Australia’s first offshore wind zone. Following the declaration, offshore wind developers applied to the Australian Government for feasibility licences. The Australian Government also announced at this time preliminary decisions had been made on the granting of feasibility licences. As of March 2024, no feasibility licences have been granted for offshore wind development.

Southern Ocean

In March 2024, the Australian Government declared an area suitable for offshore wind development in the Southern Ocean Region. The declared offshore wind zone area is smaller than the original proposed area. Visit the Australian Government’s offshore wind website for further information.

The benefits of offshore wind energy

Developing our offshore wind energy sector will not only deliver more renewable energy – it will also drive regional investment and create jobs.

  • Reaching our target of 9GW by 2040 will bring opportunities for Victoria’s workforce, mobilising thousands of workers, during the lifetime of the industry, particularly in the regions closest to offshore wind sites.
  • At its peak in the mid-2030s, the sector is estimated to require up to 2,300 – 4,000 jobs across Australia with the vast majority in Victoria. The peak in demand will be characterised by a significant number of roles involved in developing and constructing offshore wind farms.
  • From 2035 onwards, as the industry matures and reaches its operational phase, an estimated 1,500 – 1,750 ongoing jobs will be needed over 30-years, which is the lifetime of these assets.
  • Port of Hastings has been identified to develop the Victorian Renewable Energy Terminal as the primary assembly port in Victoria. Other commercial ports in Victoria have the potential to support and facilitate the establishment and operation of the offshore wind industry.

Victoria is developing offshore wind

Offshore Wind Energy Victoria (OWEV) has been established as the gateway for industry, stakeholder and community engagement as we plan for the future and grow this exciting industry. As part of the Department of Energy, Environment and Climate Action, OWEV is responsible for coordinating the work streams to support the industry’s development.

Our Offshore Wind Energy Implementation Statements support and guide industry, stakeholders and the Victorian community on the development of the offshore wind sector.

Released in December 2023, Offshore Wind Energy Implementation Statement 3 sets out the Victorian Government’s next steps in developing an offshore wind sector. It includes updates on our procurement approach, legislative and regulatory reform, supply chain and local supply, and transmission and ports.

Implementation Statement 3 also outlines our approach to protecting the environment and our continued commitment to working with Traditional Owners and support meaningful steps to self-determination.

Stay informed and have your say

We understand that Victorians have a keen interest in how offshore wind projects and supporting transmission infrastructure will be developed in our state, and we will undertake planned, respectful and ongoing engagement as we establish this new renewable energy resource.

Public consultations are an important factor in the development of offshore wind energy in Victoria.

All active Victorian Government consultations are hosted on the Victorian Government’s Engage Vic website.

Visit planning.vic.gov.au for consultations on the Environment Effects Statement (EES) processes.

For information about the Australian Government’s Environment Protection and Biodiversity Conservation consultations, visit the EPBC Act Public Portal.

Page last updated: 09/04/24