Offshore wind auction powers ahead off the Gippsland coast

THE STARTER’s gun has been fired on Australia’s first-ever offshore wind auction with competitive bidding underway for two gigawatts of clean energy capacity off the Gippsland coast.

Minister for Energy and Resources Jaclyn Symes launched the Request for Proposal (RFP) process this week, marking a major milestone in the transition away from fossil fuels.

Once fully operational this initial phase of development will harness some of the world's most consistent coastal wind resources to power approximately 1.5 million homes.

The announcement was strongly welcomed by leading developer Southerly Ten, the proponent behind the flagship Star of the South project. Company representatives praised the decision as a vital signal of market confidence, particularly given that 90 per cent of Australia's coal-fired capacity is forecast to retire by 2035.

"This announcement underscores the need to get new large-scale generation into the NEM to maintain reliability, keep electricity prices as low as possible, and reduce emissions," Southerly Ten stated.

The developer confirmed it was uniquely positioned for the upcoming tender. Southerly Ten has already lodged its federal and state environmental approval applications and successfully purchased the land required for the project’s shore crossing.

The government projects the transition to offshore wind energy will create 68,000 jobs across Victoria by 2040 with more than a third of those opportunities flowing directly into local communities.

"This auction is a giant leap towards getting Australia's first offshore wind projects built," Minister Symes said. “It will attract billions in investment and secure reliable power.”

With bids for the initial RFP stage set to remain open until August 2027, ahead of the awarding of contracts in 2028, the auction marks a critical step forward in establishing a new marine engineering industry and securing Australia’s pathway to net zero.

The bidding projects will undergo a rigorous evaluation process. State authorities will assess applications based on value for money, project deliverability, and the long-term benefits they deliver to local workers, businesses, and regional communities.

Successful projects will eventually progress through final investment, construction, and full operations ensuring Gippsland will continue its legacy as a major energy powerhouse.

Offshore wind developer Blue Mackerel strongly welcomed the announcement with Project Director David Ghaly stating that the RFP process would inject vital commercial confidence into developers, supply chain partners, and regional communities.

Blue Mackerel emphasised that the framework provided investment stability while securing long-term economic benefits. “The project is highly significant for the Gippsland region, which has traditionally been the heart of Victoria's fossil-fuel power generation,” said Ghaly.

Industry leaders view the auction as a once-in-a-generation opportunity for Gippsland to transition its skilled workforce and build new regional infrastructure to become the central hub for Australia’s emerging offshore wind industry.

The public inquiry currently underway into South Gippsland’s offshore wind industry generated strong but conditional local support. Submitters demanded rigorous construction monitoring, minimal long-term visual impacts, and meaningful incorporation of First Nations guidance.

Community advocacy for the multi-billion-dollar Star of the South project was surprisingly robust with local suppliers emphasising that Australia urgently needed to end its heavy reliance on traditional fossil fuels.

Proponents have argued offshore wind serves as a highly viable clean energy option, provided strict environmental conditions are applied during both construction and operations.

Environmental groups have voiced strong concerns regarding marine ecology with regulators focussing heavily on safeguarding migratory bird corridors around nearby Wilsons Promontory, noting that sensitive Bass Strait waters support critical whale migration routes and vital commercial fisheries.

Farmers have also warned that proposed overhead and underground cabling will cut directly through highly fertile agricultural land. Concurrently, the Bunurong Land Council Aboriginal Corporation has raised alarms over the project's massive supply chain.

In contrast, the local marine services sector strongly supports the infrastructure to combat climate-driven ocean warming and coastal erosion. However, this backing could depend on the offshore wind industry maintaining transparent community engagement and preserving public access to recreational waters.