Wind Energy: Australia's Next Generation Renewable Energy Source

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Wind is at the heart of the Australia’s energy future. Wind along with solar have been the main drivers in Australia’s renewable energy generation doubling over the past decade.

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Australia’s total installed onshore wind capacity is more than 9.1 GW. In 2021, 1.7GW of new capacity was added – the sector’s third record-breaking year in a row (Clean Energy Council. Clean Energy Australia Report 2022). The offshore wind sector is powering ahead after a new legal framework unlocked development. The Offshore Electricity Infrastructure Act was passed in June 2022.

The Australian Government strongly supports the growth of wind energy to help transform our electricity network and meet our net zero commitments.

Are you looking to invest in Australia’s offshore or onshore wind industry? We offer:

Some of the world’s best wind resources. Wind speeds reach 12 metres per second in offshore areas like Bass Strait in Australia’s southeast. Good wind resources extend hundreds of kilometres inland. (Source: Geoscience Australia)
A vast 60,000 kms coastline. It provides plentiful areas to site fixed or floating offshore wind facilities. Up to six wind resource sites have been designated. Each is close to energy demand sites.
Long term market demand. An estimated nine times the utility scale solar and wind generating capacity needed by 2050 (Source: 2022 Integrated System Plan for the National Electricity Market. Australian Energy Market Operator)
Existing capabilities. Experience in large-scale projects developed through the oil and gas sector. A strong and growing network of developers, technical specialists and advisory firms focused on wind.
Highly supportive government policy and funding.

15% growth

Wind generation grew an average 15 per cent per year the past decade

Source:
Department of Climate Change, Energy, the Environment and Water (2022) Australian Energy Statistics 2021 data.

Most attractive renewable market

Australia ranks 6th globally for the attractiveness of its renewable energy investment and deployment opportunities

Source

EY Renewable Energy Country Attractiveness Index 2022 (RECAI 60)

Future-facing governments

The Australian and state governments are highly supportive of wind power and are working together to grow the sector.

Infrastructure support

The National Energy Transformation Partnership is a framework for national alignment and cooperative action by governments to deliver market reforms and support investments in the grid.

Some Australian states are developing renewable energy zones (REZ), where clusters of projects can be developed to create economies of scale. These ensure locations with the greatest potential for clean energy generation have the infrastructure to store and transport it. These include onshore and offshore areas.

Upgrades to the transmission network will help the zones plug into the electricity grid. The Australian Government’s Rewiring the Nation scheme will provide A$20 billion in low-cost finance to expand and modernise Australia’s electricity grids to support more renewable power.
The first REZ to be declared in Australia, in the Central-West Orana region of New South Wales, is in the development phase and has enormous potential for solar and wind projects.
State Governments are exploring and developing other zones including elsewhere in NSW, in Queensland, Victoria and Tasmania.
The Australian and Victoria Governments are fast-tracking Victorian REZs and offshore wind development. An agreement in October 2022 provides concessional financing through Rewiring the Nation of A$1.5 billion for REZ projects in Victoria, including offshore wind projects, and $750 million for the Victoria-New South Wales Interconnector (VNI West) KerangLink to ensure it is completed by 2028.
The Australian and NSW Governments in December 2022 announced they would establish eight critical transmission and REZ projects in the state, thanks to A$4.7 billion Rewiring the Nation funding and $3.1 billion from the NSW Transmission Acceleration Facility.

Unlocking offshore wind

The Australian Government is rapidly progressing the development of an offshore renewable energy industry. Laws that set up a licensing regime and paved the way for offshore wind projects came into effect in June 2022.
Australia formally declared its first offshore wind zone – Bass Strait off Gippsland – in December 2022. It covers about 15,000 square kilometres off the south coast of Australia. It has potential to support more than 10GW of year-round wind energy generation.
Five further regions with world-class offshore wind energy potential have been identified. These strategic locations include sites with existing energy generation facilities and industrial hubs with strong connections to existing transmission networks, near major export ports.
There are at least 12 offshore wind farms currently in early planning stages (Clean Energy Council. Clean Energy Australia Report 2022).

“Unlocking the offshore wind industry is an exciting new chapter for Australia”

Climate Change and Energy Minister Chris Bowen in 2022.

Fast facts

Wind generation grew 20% in 20-2021. It grew an average of 15% per year over the past decade (Source: Department of Climate Change, Energy, the Environment and Water (2022) Australian Energy Statistics).
Wind accounted for 10 per cent of Australia’s total energy generation in 2021 and more than one-third of renewable energy generated (Source: Department of Climate Change, Energy, the Environment and Water (2022) Australian Energy Statistics).
Australia has 9126 MW of wind generation capacity, all onshore (Clean Energy Council. Clean Energy Report 2022).
Eight new wind farms were commissioned around Australia in 2021, representing 1746 MW of new capacity. This includes Australia’s largest, the 453 MW Coopers Gap Wind Farm in Queensland (Clean Energy Council. Clean Energy Report 2022).
Nineteen new wind farms are under construction or financially committed, as at end 2021. This includes the Stockyard Hill Wind Farm in Victoria, which at 532 MW will be Australia’s largest when completed (Clean Energy Council. Clean Energy Report 2022).

Incentives, grants, and support

Rewiring the Nation provides A$20 billion in low-cost finance to upgrade Australia’s electricity grids. The plan will see the portion of renewable energy in our National Electricity Market increase to 82 per cent by 2030.
Up to A$3 billion from the National Reconstruction Fund will support renewables manufacturing and the deployment of low-emissions technologies, including clean energy component manufacturing.
The Australian Renewable Energy Agency (ARENA) provides grants for R&D and early-stage commercialisation of low emissions technology and renewable energy projects. This includes demonstrator projects. For example:
- ARENA is providing A$0.34m towards a A$0.97m project to deploy innovative small wind turbine systems to 10 off-grid telecommunications sites, which currently rely on diesel generation.
- ARENA provided A$13.5m towards the A$111.6m Agnew Renewable Hybrid Microgrid project. Completed in January 2023, it demonstrated that wind power is a mature and reliable technology for use at a remote mining operation.
The Clean Energy Finance Corporation supports energy efficiency, renewable energy and low emissions technology projects through loans and equity investments. This includes the new A$500m Powering Australia Technology Fund focussed on businesses commercialisation.
The Australian Tax Office’s New Investment Engagement Service gives tailored guidance on tax issues to businesses planning significant new investments in Australia.

Find out more about our thriving clean energy innovation system on our transition to net zero page.

Success Stories

Italian renewable energy company Enel Green Power (EGP) began operating in Australia in 2019 and has three solar plants. In April 2022, it signed an agreement with BHP to purchase the 76 MW output of the 18 turbine Flat Rocks Wind Farm Stage One project in Western Australia.
Australia’s growing offshore wind sector is attracting investment from Spanish energy giants such as BlueFloat Energy, Iberdrola and GPG.
- Iberdrola completed the assembly of its first solar-wind hybrid plant at the Port Augusta complex in South Australia in 2021. It combines a 210MW wind farm and a 107 MW photovoltaic solar plant. The company has committed to investing €3 billion into developing Australia’s renewable energy sector.
- Naturgy group company Global Power Generation aims to reach an installed capacity of 2.2 GW by 2025 in Australia. It has committed two billion euros focused on the development of wind farms, photovoltaic power plants and storage systems. The group currently operates the Crookwell II and Berrybank I wind farms and has a portfolio of other projects under development and construction in Victoria, New South Wales and Western Australia.
- Spain’s BlueFloat Energy and Australia’s Energy Estate have announced four offshore wind projects with a total capacity of over 6GW, in December 2021 and June 2022. “Australia offers a combination of world-class wind resources, a desire to transition from fossil fuels, and suitable maritime conditions. These provide an ideal platform for large-scale energy infrastructure projects built close to load sources.” Says Carlos Martin, CEO of BlueFloat Energy.

Success stories

Enel Green Power: energising Australia’s sustainable future

Enel Green Power (EGP) harnesses energy from the sun, wind and water to power a sustainable future. The Italian company manages more than 1,200 power plants on five continents, helping drive the shift to a decarbonised society.

One of Enel Group’s primary focuses is decarbonising the Group by 2040. Australia presents one of the best opportunities to build its renewable capacity.

‘Enel Green Power takes a disciplined approach to sustainability,’ says Werther Esposito, Managing Director at EGP Australia.

‘We are committed to making the company – and the communities in which we operate – more prosperous, more inclusive, and more resilient.’

Australian business is central to EGP’s goals

EGP began operating in Australia in 2019. The company has three solar plants and 309 MW of installed capacity. Two plants are near Port Augusta in South Australia, and the third is in Cohuna in Victoria.

In April 2022 EGP also signed a renewable Power Purchase Agreement (PPA) with BHP. The agreement is for 100% of the output of BHP’s Flat Rocks Wind Farm Stage One, located inthe shires of Kojonup and Broomehill-Tambellup, in the Great Southern Region of Western Australia.

This includes energy and all Large-Scale Generation Certificates (LGCs), supplying approximately 315 GWh per year of renewable electricity for 12 years.

‘At global level, Enel Green Power’s mission is to reach a total renewable capacity, including battery capacity, of around 154 GW by 2030,’ says Esposito. ‘This would triple our 2020 portfolio, allowing us to bring forward our Net Zero commitment by 10 years from 2050 to 2040.’

In this regard, Australia’s sun-soaked plains, wind patterns and ample space make it ripe for renewables. Esposito also highlights a federal-level commitment to combating climate change. He believes this has strengthened the confidence of global renewables investors in the Australian energy market.

‘With innovation and sustainability at the heart of our strategy, we want to strengthen our clean energy portfolio by supporting Australia’s transition to meet its net zero targets by 2050,’ he says.

Change is in the air, skies and seas

Esposito says he is seeing a growing appetite for sustainable energy. In 2021, renewable energy contributed a third of the total power generation to the National Energy Market.

‘Australia is making great progress on its journey to decarbonisation,’ he notes. ‘We expect to see a ninefold increase in utility-scale renewable capacity – from 15 GW to 140 GW of solar and wind – by 2050.’

Jobs for regional Australia

‘As Australia’s energy sector transitions to renewables, it’s important we think about how we can create a positive transition for communities in regional Australia,’ says Esposito.

For instance, our EGP’s Bungala solar project is doing just that for the Port Augusta community, two years after its final coal-fired power station was decommissioned.

EGP launched a professional training scheme for the Indigenous community of Port Augusta. This helped more than 70 workers gain new skills and find work on the project.

‘This is part of our commitment to creating shared value,’ says Esposito. ‘It means delivering affordable and sustainable energy, while also looking after the needs of the communities in which we operate.’

Delivering clean energy direct to consumers

Alongside sister company Enel X, EGP plans to become an integrated green retailer offering affordable, reliable renewable power to Australian customers. EGP will initially target commercial and industrial customers. It may include residential customers as its pipeline grows, since EGP sees the mass market as a possible natural extension for the future.

‘Enel Australia will offer up to 100% renewable energy contracts,’ says Esposito. ‘This will help customers meet sustainability objectives while reducing their costs.’

The retail offering is backed by EGP’s renewable generation and battery storage and bundled with Enel X’s technologies and services.

‘Our aim is that the market recognises us as a greener alternative to the traditional energy retailers within Australia,’ says Esposito. We look forward to delivering on our promise to provide the energy solutions required to shift Australia into a new era of abundant, reliable, and low-cost energy.’

Valued partnerships help EGP deliver on its mission

EGP recently partnered with Agriculture Victoria to bring its agrivoltaic program to Australia.

The program integrates land-based farming activities with solar power plants. Together, the organisations are developing an Agrivoltaic Research Project at Cohuna Solar Farm.

‘New models for decarbonised development, such as co-land use, can increase land productivity at large-scale solar farms,’ says Esposito. ‘This project aligns with Enel Green Power’s aim to produce clean energy more efficiently.’

In addition to its research projects, in 2021 EGP partnered with Monash University to extend its award-winning Green Steps program. The program offers practical sustainability training and consultancy projects for emerging university leaders.

Assistance from Austrade

Esposito says Austrade has been instrumental in EGP’s expansion in Australia.

‘Austrade has helped unlock local market opportunities, assisting the EGP business to grow in Australia,’ he says. ‘We have used Austrade’s network to turn local market connections and insights into valuable investment opportunities.’

Looking forward to a sustainable future

EGP has ambitious growth plans for Australia. The company is looking for a financial partner to support the expansion of its renewables portfolio. In addition to wind, solar and storage technologies, EGP is considering green hydrogen for future projects.

‘Enel Green Power wants to help solve Australia’s energy trilemma of ensuring energy security, reliability, and affordability,’ says Esposito. ‘We look forward to delivering on that promise.’

Find out more about investing in Australia or contact Austrade for more information.

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