Victorian offshore wind farms may supply power to grid by 2025

It’s a race against time to protect the state’s energy supplies as coal-fired stations go offline in 2025, and the government is powering ahead with this ambitious plan.

Taxpayers funds will be used to secure Victoria’s offshore wind projects in a rate to protect the state’s power supplies.

Taxpayer funds will be used to secure Victoria’s offshore wind projects in a race to protect the state’s power supplies as coal-fired stations start going offline from 2028.

The Saturday Herald Sun can reveal taxpayer funds will be used to guarantee returns for private companies looking to build massive wind farms off the Victorian coast.

Construction on some projects could start as soon as 2025 and the government expects offshore wind could start supplying power to the grid by as early as 2028, the same year Yallourn is planned to shut.

It can also be revealed the Port of Hastings will be transformed as the home of the Victorian Renewable Energy Terminal, where parts of the massive turbines will be delivered, maintained and shipped out for construction.

In a bid to avoid a “spaghetti effect” of power lines across the state, the government is also reviewing its transmission network and will announce preferred locations for new power corridors connected to Gippsland and Portland.

Ahead of the revival of a state-owned electricity commission, the government is stepping in to secure revenue for mass wind turbine projects as it races the clock to transition the grid to cleaner energy and prevent blackouts.

The planned closure of Yallourn in 2028 means time is running out to transform the state’s power grid, with the government banking on private offshore wind to cover looming shortfalls and as more power stations go offline. It has set a target to generate at least 2GW through offshore wind by 2032 – equal to about a fifth of Victoria’s energy needs.

To do this, new documents obtained by the Saturday Herald Sun show the state intends to provide financial support to make the projects “bankable”.

The government will announce preferred locations for new power corridors connected to Gippsland and Portland.

One scheme floated is for taxpayers to pay the difference if the wholesale price of energy drops below a set sum, meaning offshore wind operators won’t lose money when prices fluctuate.

The strategy would provide companies with the certainty needed to invest in significant long-term projects.

They will also discuss with operators about whether other support is needed through contributions to help them build and finance their operations.

“Under this process the government would seek bids from developers looking to secure a support package for their offshore wind projects,” the document reads.

“Industry-led development of offshore wind supported by a government financial support package is the optimal method to deliver the benefits of offshore wind for Victoria.”

Energy Minister Lily D’Ambrosio said Victoria was leading the way for Australia’s first offshore wind farms.

“This latest implementation statement will give industry the guidance they need to kickstart our first projects,” she said. “Offshore wind will create over 6000 jobs, generate billions in investment and create cheaper, cleaner, more reliable power for all Victorians.”

The Andrews government has already stumped up $40m to fund feasibility studies for three projects proposed off the Victorian coast. This includes the Star of the South, planned off Gippsland, which hopes to provide 2.2GW of energy and has proposed to link up to the power grid at Loy Yang A.

Huge wind turbine parts are set to be delivered, maintained and shipped for construction through the Port of Hastings.

It will be supported by other industrial hubs along the coast.

Under current plans, offshore wind farms will connect to networks at Gippsland and Portland and new transmission towers are expected to feed energy into areas of high demand such as Melbourne.