The Victorian government will launch an offshore wind auction in September of this year and expects to award contracts by the fourth quarter of 2026.
This is according to the Offshore Wind Energy Implementation Statement 4 (IS4) , released by Victoria’s Minister for Energy and Resources Lily D’Ambrosio on 9 April, which outlines the next steps towards building 2 GW of offshore wind capacity in the Australian state’s waters.
The state government is currently in the Registration of Interest (ROI) process that commenced in March and will close in May. The ROI allows for the holders of offshore wind feasibility licences in Victoria to access the information needed to inform the Request for Proposal (RFP) stage later this year.
The Victorian government plans to launch the RFP process in September this year, with contracts to be awarded before October 2026, according to a press release from the Victorian Department of Energy, Environment and Climate Action (DEECA).
The winning bidders will be supported through Contracts for Difference (CfDs) and availability payment, with the CfD model set up to provide investment certainty while the availability payment will only be made once the project is generating electricity, providing energy security, according to the Victorian government.
There are 13 offshore wind feasibility licence holders in Victoria as the Australian government awarded twelve feasibility licences for the Gippsland declared area in 2024 and one feasibility licence for the Southern Ocean declared area at the end of February this year.
In May 2024, the federal government granted the initial licences to six offshore wind projects with a combined capacity of approximately 12 GW in the Gippsland offshore wind zone. Some two months later, six more Gippsland projects were granted feasibility licences, bringing the total potential project capacity to 25 GW.
In December 2024, the state transmission system operator (TSO) VicGrid commenced the procurement process to engage a delivery partner to design, build and operate the transmission line in Gippsland.
In February this year, the federal government awarded another offshore wind feasibility licence for a project in Victoria, for a proposed 1.2 GW wind farm in the Southern Ocean region, off Victoria’s Southwest coast.
Victoria plans to install 2 GW of offshore wind capacity by 2032 and has set offshore wind energy targets of 4 GW by 2035 and 9 GW by 2040.