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Victorian Government releases second of three planned Offshore Wind Implementation Statements

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In March 2023 the Victorian Government released its second Offshore Wind Implementation Statement. This announcement keeps momentum for the developing Victorian industry at a time when proponents are preparing feasibility licence applications in the Gippsland Declared Area, which are due by 27 April 2023.  Having regard to state government policies is not a direct requirement of the feasibility licence merit criteria in the Australian Government’s OEI Regulations and Guidelines. However, a project proponent should consider consistency of the project with the Victorian Government’s Statement as this may provide further support to the case for project viability.

Key points

  • Offshore Wind Energy Victoria (OWEV), which sits within the Department of Energy, Environment and Climate Action, is aiming to start a competitive process by 2025 for the first tranche of offshore wind projects
  • An Environmental Effects Statement will be available in mid-2023 for the Victorian Renewable Energy Terminal to be developed at the Port of Hastings in Crib Point
  • VicGrid expects to announce specific transmission connection point locations and high-level route corridors in Gippsland and Portland in late 2023. The Statement says this is being developed in accordance with the Victorian Transmission Investment Framework  (VTIF)  The VTIF has not yet been finalised following consultation in 2022. A consultation summary report is available on Vic Engage website.
  • The Victorian Government will contribute $6M to fund a Wind Worker Training Centre to train workers to support Victoria’s onshore and offshore wind energy industry
  • Offshore Wind Energy Victoria is developing a fit-for-purpose regulatory framework to be delivered across 3 stages commencing in 2023. We will watch this development and expect amendments to the Marine and Coastal Act, the new Public Land Act and potentially new bespoke legislation for the OSW sector.  

Legislative reform

The Victorian Government will develop a regulatory framework that will complement the existing Commonwealth legislation. The framework will be delivered in 3 stages:

(a)        The first piece of legislation is expected to be tabled in Parliament in 2023. The first stage will amend land legislation to allow offshore wind developers to obtain tenure over Crown land and amend electricity safety legislation to allow the installation of energy infrastructure on public land. This is likely to be changes to the Marine and Coastal Act and the proposed Public Land Act (which will replace the Crown Land (Reserves) Act)

(b)        Administrative solutions to address any inefficiencies.  Expect to see guidance material, such as a pro forma licence for rights to tenure over the seabed in Victorian coastal waters.

(c)        Rather than retrofitting existing legislation, consideration of bespoke legislative and regulatory framework will be developed that will specifically apply to offshore electricity infrastructure in Victoria.   The aim includes to deliver a process that is aligned with the Commonwealth legislation and efficient and harmonised approvals process.    Typically the management of projects which cross State and Commonwealth jurisdictions is done on a project by project basis between the government agencies, and legislation which supports or streamlines this would be a welcome change. 

Procurement

OWEV plans to undertake detailed engagement with key stakeholders to test and refine the procurement design and optimal support package. A formal competitive procurement process for the first tranche of at least 2 GW of offshore wind energy will commence by 2025.

OWEV intends to implement a procurement process similar to those used in the UK and Europe where developers wanting to secure a government support package for offshore wind projects make competitive bids.

Winnings bids will be decided based on the following factors: 

  • Price
  • Demonstrated track record of delivering projects
  • Quality of community engagement and benefits sharing
  • Project preparedness
  • Workforce and industry development
  • Value for money

Transmission

A comprehensive community and stakeholder engagement process for transmission infrastructure will commence in early 2023. Consultation will inform the conceptual design and high-level route corridor planning for transmission infrastructure. VicGrid’s starting point is to facilitate connection of 2-2.5 GW generation capacity in both Gippsland and Portland. Transmission connection point locations in Gippsland and Portland are expected to be announced in late 2023. After connection points are identified, a competitive procurement process for an infrastructure provider will begin in the first quarter of 2024. We note that this will run in parallel to the AusNet Gippsland Renewable Energy Zone proposal which has  already made its EES referral[1].

New 'Victorian Renewable Energy Terminal’ at the Port of Hastings

The Port of Hastings has been confirmed as the most suitable port to facilitate Victoria’s first offshore wind projects. The port will support offshore wind delivery of up to 1 GW per year and will be able to handle turbines up to 18 MW with fixed foundations. Prior to redevelopment of the Port commencing, an EES will be prepared and details on community engagement will be released in mid-2023.

Subject to detailed design and approvals, the Renewable Energy Terminal is expected to include at least 2 berths with a total wharf length of at least 400m, and form up to 35 hectares of heavy-duty hardstand comprised of 10 hectares of reclaimed land connecting the wharf to the existing 25-hectare Old Tyabb Reclamation Area (OTRA) land. Construction is schedule to commence in late 2025 subject to successfully obtaining the necessary approvals.  

Workforce development

The Victorian Government is investing in the development of the offshore wind workforce. A Wind Worker Training Centre will be developed with a $6M Victorian Government investment. A detailed workforce development plan will be released later in 2023 and will examine:

  • The occupations, skill sets, and competencies needed
  • Geographical demand for workers across the project lifecycle
  • The education and training needed to develop the workforce
  • Re-skilling and upskilling opportunities in the resources, industrial, and construction sectors.

Implementation Statement 3 will be released in late 2023 and will provide further detail on the Victorian Government support packages and procurement process.

For more information see our previous article here or get in touch with our authors below.

https://www.planning.vic.gov.au/environment-assessment/referrals-and-decisions

Reference

  • [1]

    https://www.planning.vic.gov.au/environment-assessment/referrals-and-decisions

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