Global giants expected to fail in their bids for NSW offshore wind-powered generation licences

A decision is understood to be imminent to grant a sole permit to Oceanex and Norwegian giant Equinor.

Some of the world’s largest renewable energy companies look likely to miss out on securing a licence to develop an offshore wind-powered electricity generation farm in NSW.

It’s understood a preliminary decision to grant a sole permit to Oceanex and Norwegian giant Equinor is close to being confirmed.

Electricity powered by offshore wind generators is a critical element of the federal government’s goal for Australia to reach net zero emissions by 2050 – a strategy that has attracted the attention of many of the world’s largest energy companies.

The Australian understands German giant RWE, French government-owned EDF Energy and Spain-based Bluefloat had sought so-called feasibility licences to develop off the Hunter Region of NSW.

For its bid, Bluefloat has partnered with Origin Energy, Australia’s largest electricity and gas retailer.

Feasibility licences give projects exclusive rights over a part of the region for seven years, which is critical for attracting ­investment.

But federal Energy Minister Chris Bowen last month said Equinor and Oceanex were in pole position, and The Australian understands it is close to being confirmed.

A final sign-off will be determined after a 60-day consultation period with Indigenous groups, and industry sources said an announcement could be imminent.

The process is expected to be quicker than what occurred in Victoria where authorities struggled for weeks after receiving more than three dozen appli­cations from developers – all seeking to capitalise on near-perfect conditions for offshore power generation. Victoria’s coastline is ideal as winds are strong and consistent by international standards, while a large area of shallow ocean less than 50m to 60m deep is suitable for wind turbine platforms to be fixed to the seabed – a much more mature and cheaper technology than the floating turbines that must be used in deeper water.

The federal government this year awarded licences to nearly a dozen would-be developers, including Origin Energy, Star of the South, Copenhagen Infrastructure Partners and Orsted, ending an exhaustive process.

Developments in NSW must be floating turbines – a technology that is some years behind the fixed platforms – but developers insist it is viable for Australia’s most populous state.

NSW has the added advantage of having significant load centres, meaning the prospect of substantial new generation would be substantially required.

Would-be developments will be able to capitalise on existing transmission lines that will have less usage once Australia’s coal-fired power stations are retired.

The Australian Energy Market Operator expects all coal-fired power stations to have been shut down by 2038, although some have raised the possibility of extensions if Australia is unable to build enough renewable energy projects – or the Coalition is in government after the next election and implements its nuclear energy plan.

The federal opposition has said it will build seven nuclear power stations on the sites of mothballed coal-fired generation plants, negating the need for tens of thousands of new high-voltage transmission lines.

The government has rebuked the plan, insisting it would be more expensive that its own plan to generate 82 per cent of the country’s power with renewables by 2030.

It also says that nearly all of the proposed seven nuclear facilities would not be ready by the time nearly all of the coal power ­stations have been retired.