Australian offshore wind: the transformative step to an energy resilient future?

Australia’s energy landscape is undergoing a fundamental shift, driven by the need to reduce reliance on fossil fuels and meet ambitious emissions reduction targets. Distribution network operators are under the greatest pressure in their history as they balance resilience with investment. Offshore wind expert, Martin Georgiev, explains why Australia is poised to tap into a vast renewable energy resource: offshore wind.

The case for offshore wind

The Australian Energy Market Operator (AEMO) has identified offshore wind to meeting future energy demands. Offshore wind offers several distinct benefits:

• As offshore wind can allow for larger developments, it can generate greater energy – especially for coastal communities.
• Better resource due to the lack of obstacles that disturb the wind. This means higher wind speeds, lower turbulence intensity and lower wind shear (difference between wind speeds at the top and bottom of the turbine). Also allow for greater access and consolidated ownership.
• Diversification of sources. Solar and onshore wind already account for a good proportion of the generation mix.
• Reduced socio-economic impact when compared to fossil fuel energy production by virtue of the lower air quality, visual and noise impacts.

Economic and strategic benefits of offshore wind

As coal-fired power stations retire – such as the scheduled closure of the Loy Yang A power station in Victoria – offshore wind can add generation capacity. Offshore wind will also contribute to:

1. Economic growth and job creation: According to CSIRO and the Blue Economy Cooperative Research Centre, offshore wind could create up to 8,000 direct jobs and attract billions of dollars in investment. Ports, shipyards, and regional communities stand to benefit from increased industrial activity and supply chain expansion.
2. Decarbonisation and diversification: By replacing coal and gas generation, offshore wind has the potential to significantly contribute to the decarbonisation of Australia’s electricity sector while increasing the diversity of generation.

Challenges in integrating offshore wind into existing infrastructure

Despite its promise, integrating offshore wind into Australia’s energy mix is not without challenges. Key hurdles include transmission infrastructure, regulatory approval, and supply chain readiness.

1. Transmission and grid integration: Offshore wind farms require extensive high-voltage subsea and onshore transmission networks to transport electricity to demand centres. With Australia's existing grid infrastructure designed for centralised thermal generation, significant upgrades will be needed to incorporate offshore wind. Strategic grid planning and upgrades, as well as the development of Renewable Energy Zones (REZs) and offshore connection hubs are essential to facilitate a smooth integration.
2. Regulatory and environmental considerations: The recent designation of offshore wind development zones is an encouraging step, but project developers must navigate complex regulatory approvals. Environmental impact assessments, marine spatial planning, and stakeholder consultations with fisheries, indigenous communities, and maritime operators are critical. The Australian Government must streamline approval processes to avoid unnecessary delays while ensuring environmental and social considerations are addressed.
3. Supply chain development: Establishing an offshore wind industry requires a strong supply chain and specialised port facilities. Collaboration with global offshore wind leaders can accelerate local industry development and create thousands of skilled jobs in engineering, construction, and maintenance. By investing in manufacturing capabilities for some of the components, reliance on imports could be reduced and local economies boosted.

The road head: key actions for a successful offshore wind industry

To unlock the full potential of offshore wind, Australia must take a coordinated and strategic approach:

• Investment in transmission infrastructure: Grid upgrades and offshore connection hubs should be prioritised to facilitate smooth power distribution.
• Policy certainty and streamlined approvals: Clear and consistent regulatory frameworks and support/off-take mechanisms will provide developers with the confidence to invest in large-scale offshore projects.
• Local supply chain and workforce development: Establishing training programs and local manufacturing and operation and maintenance capabilities will maximise economic benefits and job creation.
• International collaboration: Leveraging expertise from established offshore wind markets such as Europe and Asia will accelerate Australia’s learning curve and technological adoption.

Offshore wind presents a transformational opportunity for Australia’s energy transition. With investment, planning, and regulatory support, it can become a cornerstone of the country’s clean energy future, providing reliable, sustainable power while driving economic growth and job creation. The recent allocation of planning zones is a step in the right direction, but a proactive and coordinated effort is required to turn potential into reality. For energy operators and policymakers, now is the time to embrace offshore wind as a key pillar of Australia’s decarbonised energy future.