Australia’s growing offshore wind sector is attracting investment from Spanish energy giants such as BlueFloat Energy, Iberdrola and GPG.
Australia has 60,000 km of coastline and some of the world’s best wind energy resources. There are over 12 developers working on more than 20 offshore wind farms around Australia. According to the Blue Economy Cooperative Research Centre, Australia has the potential to generate 2,000 GW from offshore wind in areas less than 100 km from existing substations.
Over 32% of Australia’s electricity generation now comes from renewable energy. By 2050, 255 GW of wind and 300 GW of solar will be needed to power Australia. The Australian Government has committed funding for clean energy and renewables projects, creating opportunities for investors.
Spanish energy investors are tapping into offshore wind opportunities and helping drive Australia’s energy transition.
Spain’s BlueFloat Energy and Australia’s Energy Estate announced their first 3 offshore wind projects in Australia in December 2021. Two projects use floating wind technology in NSW’s Hunter Coast and Wollongong regions. The other project uses bottom-fixed technology in Victoria’s Greater Gippsland region.
In June 2022, BlueFloat Energy and Energy Estate announced their latest development. The Southern Winds Offshore Wind project is in the Portland West Offshore Wind Renewable Zone. The project brings the partnership’s total capacity to over 6 GW.
‘Offshore wind energy is booming globally and now it is Australia’s time,’ says Carlos Martin, CEO of BlueFloat Energy. ‘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.’
Other major Spanish investors embedded in Australia’s clean energy sector include:
Spain and Australia are aligned on their commitments to energy transition. Both are focused on increasing renewable energy generation and improving its integration in the grid. This will be enabled through better electricity transmission lines, battery storage and green hydrogen.
‘Collaboration would lead to further investment, high-skilled job creation and increased prosperity for both nations,’ says Elena Laburu, Austrade Senior Business Development Manager. ‘Agreements with trusted partners and like-minded countries are essential to minimise disruptions in the supply chain.’
Spain and Australia plan to deepen cooperation on renewable energy and infrastructure. This commitment was strengthened by the Australian Prime Minister’s visit to Spain in June. The Spanish Minister for Industry, Trade and Tourism also visited Australia in September.
Both governments affirmed their commitment to a future Europe-Australia trade agreement and ongoing collaboration towards a low-emissions future.
In November 2021, the Australian Government passed the Offshore Electricity Infrastructure Act 2021. The Government also announced the first offshore wind zone in April 2022 – the Bass Strait off Victoria’s Gippsland coast. In this zone, wind speeds reach up to 12 metres a second (comparable to the North Sea between Britain and Europe).
Queensland, Victoria, Tasmania, South Australia and Western Australia have offshore wind in shallow resources. These are near the coast and suitable for fixed offshore wind turbines. Some states have offshore wind resources located in deep water, which will require floating turbines.
The Victorian Government released its Offshore Wind Policy Directions Paper in March 2022. It plans for at least 2 GW by 2032, 4 GW by 2035 and 9 GW by 2040.
Studies suggest Victoria has the potential for 13 GW of capacity from coastal regions by 2050. This is 5 times the state’s current renewable energy generation. Its recently declared 95% renewable energy target by 2035 relies mostly on offshore wind.
Australia’s offshore wind supply chain is in early stages. However, the Australian Budget October 2022–23 committed concessional funding for offshore energy transmission links. There are also strong capabilities and potential transferable skills from Australia’s robust oil and gas industry.
The Australian Government is accelerating Australia’s energy transition under the Powering Australia plan to meet its net zero by 2050 commitment. It is bringing forward coal plant closures and prioritising investment into low-emissions technologies.
Australia is ranked sixth in the world for renewable energy investment and deployment opportunities in EY’s latest Renewable Energy Country Attractiveness Index. The Australian Budget October 2022–23 committed a record A$25 billion to clean energy spending. This includes funding for projects that unlock opportunities for global clean energy and renewables investors.