Victorian offshore wind auction opens with plans to power 1.5 million homes
- The Victorian government has launched its first offshore wind auction, seeking to generate 2 gigawatts of power to supply 1.5 million homes and create thousands of regional jobs.
- Bidding for projects off the Gippsland and south-west coasts is open until August 2025, with contracts expected to be awarded in 2028 and operations beginning by 2035.
- The initiative aims to provide a reliable renewable energy source to replace retiring coal-fired plants and meet growing electricity demand from sectors like data centers.
Victoria has officially launched its first offshore wind auction, inviting developers to bid for the opportunity to supply an initial 2 gigawatts (GW) of renewable energy to the state’s power grid. This landmark initiative is expected to generate enough clean electricity to power 1.5 million homes annually while creating thousands of new jobs across the region.
The auction targets two primary areas: Australia’s first declared offshore wind zone off the Gippsland coast and a second zone located near Warrnambool on the state’s south-west coast. Successful applicants will receive dedicated government support to help navigate the complexities of delivering these large-scale infrastructure projects.
The bidding window is currently open and will remain so until August of next year. The Victorian government anticipates awarding contracts by 2028, providing a clear pathway for developers to secure investment and begin the transition toward construction and full-scale operation.
While the auction marks a significant milestone, it follows a brief delay from last year as state and federal authorities synchronized their regulatory timelines. Current projections suggest that the first offshore wind energy will not enter the grid until 2035. This timeline means the projects will come online roughly seven years after the scheduled 2028 closure of the Yallourn coal-fired power station, a facility that currently provides nearly 15 percent of Victoria’s total power supply.
Victorian Energy Minister Jaclyn Symes described the transition as an “amazing opportunity” for the state, emphasizing that offshore wind will provide a reliable source of inexpensive energy while revitalizing local economies. She noted that offshore wind is an essential component of the state’s strategy to maintain energy security as traditional coal plants are retired.
Addressing concerns about future supply, the Australian Energy Market Operator (AEMO) recently highlighted a massive surge in electricity demand driven by the growth of data centers. Projections suggest these facilities could require as much power as every home in Victoria and New South Wales combined by 2036. However, Minister Symes reassured the public that AEMO’s modeling indicates Victoria will not face a power shortfall following the closure of the Yallourn plant.
To ensure these projects are financially viable and attractive to investors, the government will award contracts through the Electricity Services Entry Mechanism (ESEM). This scheme, agreed upon by energy ministers late last year, is designed to provide the long-term certainty required to drive significant private investment into the renewable energy sector.
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Original article and photo by "ABC News"
