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The Australian Government has recently identified six offshore wind zones that will be favoured for offshore wind development projects in Australia.
Federal Energy Minister Chris Bowen announced that the first zone identified for public consultation is in the Bass Strait located off Gippsland, Victoria. This is the first offshore wind area to be formally assessed under the Government’s Offshore Electricity Infrastructure framework.
Public consultation has commenced and will offer an opportunity for all stakeholders with interests in the proposed areas to provide feedback. Any submissions on this proposal must be received by 7 October 2022.
The other regions identified for offshore wind energy projects include the:
This is a long-awaited step towards greater certainty for investors in offshore wind farm projects in Australia.
What is offshore wind energy and how does it work?
Offshore wind energy is a sustainable source of renewable energy that is commercially operated at a large scale in various countries (especially in Europe) and is rapidly expanding globally. It is expected to be a vital part of Australia’s clean energy transition.
Offshore turbines catch the strong offshore winds to generate electricity. The electricity is then transmitted through a network of cables and substations to connect to the existing electricity grid. Offshore wind can help with energy security and resilience due to its power capacity and availability at times when solar power and onshore wind are not available.
Australia possesses world-class offshore wind resources, which are generally located in the southern half of the country, adjacent to large population centres, industrial hubs and mining projects.
How is offshore wind energy regulated in Australia?
The Offshore Electricity Infrastructure Act 2021 (OEI Act) commenced on 2 June 2022. The OEI Act, in combination with the supporting regulations, regulates Australia's offshore wind industry in Commonwealth waters and implements a licensing scheme for those proponents wishing to develop offshore infrastructure projects. The legislation permits the construction, installation, commissioning, operation, maintenance and decommissioning of offshore renewable energy infrastructure and offshore electricity transmission infrastructure.
Work health and safety is provided for by applying the Work Health and Safety Act 2011 to offshore infrastructure activities. This Act also applies state and territory laws in relation to offshore infrastructure.
Under the OEI Act, proponents wishing to develop offshore infrastructure projects will require a licence. There are four different types of licences:
All licences have the ability to be extended beyond the initial term at the discretion of the Minister.
In order for a licence to be granted to an eligible person, the licence must meet certain merit criteria. The criteria are:
Before an offshore infrastructure project can commence, it must meet the requirements of the OEI Act and all relevant commonwealth, state and territory environmental requirements. The licences issued under the OEI Act are separate to approvals issued under the EPBC Act. It is important for project proponents to note that state and territory requirements and approval under one piece of legislation, does not guarantee approval under another.
The National Offshore Petroleum Safety and Environmental Management Authority (NOPSEMA) will be responsible for monitoring and enforcing compliance with the OEI Act, environmental obligations, general operations and safety. NOPSEMA have released a guideline on offshore environmental approvals.
The National Offshore Petroleum Titles Administrator (NOPTA) will manage the administration of licences, including maintaining registers, and collecting relevant information and reports.
As the first offshore wind zone has now been declared under the OEI Act, we suspect that the next 12 months will be a busy time for project proponents as they attempt to navigate the licensing scheme and seek to apply for the relevant state and federal approvals, and we have already seen a number of projects recently being announced.
As this is a rapidly developing area of law, we expect that the Federal Government will release further guidance, particularly in relation to licensing fees and annual levies, health and safety obligations, management plans and decommissioning requirements.
We will continue to monitor the legal developments.
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Work Health and Safety Act 2011 (Australia)
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