Australia’s Victoria Sets Date for Country's First Wind Energy Auction
The southern Australian state of Victoria has rescheduled what will become the country’s first offshore wind industry auction as it works to finalize details with the federal government. The auction, which is planned for August, is good news for the beleaguered Australian efforts, which have struggled to make progress.
Australia has been following a meticulous process, having finalized the regulatory framework for offshore wind in 2022, followed by the selection of zones for the projects. Companies are developing plans and bidding for feasibility licenses.
Victoria, which includes Melbourne and key industrial regions in the country, reports it will seek 2 GW of capacity in the August 2026 auction. Minister for Energy and Resources Lily D’Ambrosio today announced the Request for Tender (RFP) for Victoria’s first offshore wind industry auction as the first step toward the goal of reaching 2 GW of installed offshore capacity by 2032, 4 GW by 2035, and reaching 9 GW by 2040. The auction had been postponed in 2025.
The minister notes Victoria has some of the best offshore wind resources in the world, and they believe it will be critical to the state’s sustainability goals. The minister noted that work continues with the industry and the Commonwealth to finalize the design of the country’s support program. The Albanese government proposed a program called the Electricity Services Entry Mechanism, which won government support in December.
“We want to give industry the certainty it needs to invest and help us keep building the renewable energy Victoria needs to push down energy bills,” said Victoria’s Minister for Energy and Resources Lily D’Ambrosio. “We’re working closely with developers on the progress of this exciting auction to ensure strong competition to secure the best projects and best value for Victorians.”
The date for the auction comes as good news for the Star of the South project, which proposed 2.2 GW in Victoria. It is viewed as the country’s most developed project and is poised to be an early leader.
Moving forward with the offshore wind component is critical for Victoria, which has scheduled the closing of two major coal-fired power plants by the end of the decade.
The offshore wind energy industry has been facing challenges in Australia. While several key projects have been offered the feasibility licenses, others, including plans from RWE, AGL, and BlueFloat, have been withdrawn. The government has also failed to back key efforts such as plans for a wind seaport in Victoria.
Last week, Australia’s Minister for Climate Change and Energy, Chris Bowen, announced that the government was offering two feasibility licenses to Bunbury Offshore Wind and one to Westward Wind, so that the projects could develop detailed plans. He noted it is part of the strategy to develop 4 GW of cleaner energy for Western Australia.
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However, he also announced that the government will not be granting feasibility licenses for generation projects in the Illawarra (south of Sydney), as no application was able to be progressed to a license award. In addition, he reported that a preliminary decision has been made to not offer feasibility licenses in the Bass Strait due to a lack of competitive bids.
The government asserts it remains committed to offshore wind. The hope is that the state scheduling the auction, after delaying it in 2025, will provide a new excitement to support enhanced activity in the sector.