Australian offshore wind guide 2.0

Australia’s national regulatory framework for offshore energy came into effect in June 2022. Since then, there has been a flurry of activity in the offshore wind sector with domestic and international developers announcing new projects almost every week. This includes Copenhagen Energy’s proposal to develop four 3GW offshore windfarms, which will be the largest in Australia if they go ahead.


Australia’s national regulatory framework for offshore energy came into effect in June 2022. Since then, there has been a flurry of activity in the offshore wind sector with domestic and international developers announcing new projects almost every week. This includes Copenhagen Energy’s proposal to develop four 3GW offshore windfarms, which will be the largest in Australia if they go ahead.

As the May 2022 edition of our Australian Offshore Wind Guide will attest, the sector is set to lead Australia’s energy transition, with:

  • 25 announced offshore wind farms;
  • the offshore wind sector having, according to Blue Economy, the potential to install over 2,000GW of offshore wind turbines within 100km of current electricity substations excluding environmentally restricted and low wind areas; and
  • the largest coal-fired power station in Australia (Eraring) to be decommissioned in 2025.

As such, this edition of our Australian Offshore Wind Guide is focussed on the developers who are leading the sector, their projects, and the regulatory developments that have been put in place to ensure the continued growth of Australian offshore wind.

Clayton Utz expertise

Clayton Utz's updated Australian Offshore Wind Guide provides an insight into key developments and relevant legislation, informed by our recent experience and research in the offshore wind sector. Peter Staciwa (Partner, Project Development & Finance) previously explored how Australia can capitalise on its offshore wind potential, which can be viewed here.

Clayton Utz continues to act for The Star of the South project and its main investor Copenhagen Infrastructure Partners. The Star of the South Project is Australia’s first and most advanced offshore windfarm project. The team is led by Peter Staciwa and involves partners Rory Moriarty, Andrew Leece, Damien Gardiner, Cilla Robinson, Pip Mitchell, Alison Kennedy and Jo Pugsley.

As the offshore wind industry continues to develop, Clayton Utz will remain at the forefront of all regulatory changes, project development and relevant industry news.

Regulatory Frameworks and Policy Targets

The enhanced regulatory frameworks implemented by the Commonwealth, Victorian and New South Wales Governments signal their intention to establish a leading offshore wind industry. The Australian Government’s Offshore Electricity Infrastructure (OEI) framework which came into effect in June 2022 provides clarity and certainty to investors wanting to build Australia's offshore energy future. The Australian Government has also announced its intention to commence public consultation with respect to six proposed offshore wind regions.


The global boom in offshore wind has lowered turbine costs, and accelerated development in technology including the size and design of turbines, allowing offshore wind to upscale quickly, particularly as coal plants are decommissioned. As floating turbine technology is further developed and becomes cheaper, we will see a greater uptake of offshore wind farms in Australia, as our best resources are located in deeper water which renders turbines on fixed foundations inaccessible. While floating turbine technology has not progressed as far as fixed turbine technology, the industry clearly is positive about future developments with about 30% of projects currently proposed in Australia being floating offshore wind projects and Blue Economy holding its seminar on Trends, Challenges and Future Perspectives for Floating Offshore Wind Turbine Development earlier this month.


Offshore wind projects located close to current renewable energy projects have the potential to capitalise on existing infrastructure and established grid connections. As traditional power stations retire, the offshore wind sector can also take advantage of the skilled workforces and contractors who will become available.

A Blue Economy report identified the Hunter, Illawarra, Western Australia and Gippsland regions as desirable energy locations. These regions benefit from abundantly windy offshore conditions at times of low onshore wind and solar generation, creating more reliable year-round generation capacity.

The Bass Strait off Gippsland, Victoria is the region closest to being ready for offshore wind development.

Part A: the developers

The offshore wind sector in Australia is pioneered by a few key players. The top developers to follow are:

Copenhagen Infrastructure Partners (CIP): Danish fund manager CIP specialises in energy infrastructure investments. It is one of the largest developers of offshore wind globally. In Australia, CIP is the majority owner of the Star of the South Project, Australia’s most progressed offshore wind farm. Star of the South alone has the potential to power around 1.2 million homes and supply up to 20% of Victoria’s electricity needs. It is expected to help replace the Yallourn coal power plant, due to close in 2028.

In May 2022, CIP sold a 10% interest in the Star of the South Project to Cbus Super.

Macquarie | Green Investment Group: Macquarie Group’s offshore wind business is conducted through Corio Generation, a portfolio company of GIG. While Corio Generation operates on a stand-alone basis, it has deep access to long-term capital and offshore wind expertise via Macquarie Group.

Corio Generation is the developer of two offshore wind farms with a total proposed capacity of 4GW. Both projects will be located off the coast of Gippsland.

Iberdrola: Spanish investor Iberdrola has clearly established itself as one of the biggest renewable energy project developers in the world, and a leader in offshore wind. Globally, it has 1.24GW of offshore wind capacity in operation, another 5.5GW under construction, and a target of 95GW of total renewable capacity by 2030.

In July 2022 the renewable energy giant has announced its intention to invest in offshore wind projects in Gippsland by mid-2023. Given its expertise in the sector and its aggressive renewable capacity targets, Iberdrola will be an investor to follow once it enters the Australian offshore wind market.

DP Energy: DP Energy is an international renewable energy company headquartered in Ireland. DP Energy has partnered with Iberdrola to develop the Port Augusta Renewable Energy Park in South Australia and several offshore wind farms in the northern hemisphere (totalling 3GW proposed generation).

In August 2022, DP Energy announced plans to develop five offshore wind projects in Australian state waters. A map published by DP Energy identifies areas off the coast of Warrnambool in Western Victoria, Wonthaggi and Port Albert in Victoria’s Gippsland region, and the Wollongong and Newcastle areas in NSW. Specific details and proposed capacity targets are yet to be announced.

Australis Energy: Australis Energy is an offshore wind developer and origination company with significant project delivery experience in the United Kingdom. It is currently focussed on offshore wind opportunities in Australia and has developed three Australia offshore wind projects in a joint venture with GIP. The projects (located in Victoria, South Australia and Western Australia) will have a total capacity of 1.4GW.

While these projects do not have the capacity of Star of the South or the GIG projects, Australis Energy was a relatively early entrant in the Australian offshore wind market which means that its projects are comparatively more progressed than others. The projects are also located close to existing infrastructure that will enable effective connection to regional electricity grids. Australis Energy and GIP have since announced that they intend to being construction on the three projects by 2030. Earlier this year GIP also named a new project development director for offshore wind, signalling its intention to continue targeting offshore wind opportunities.

Oceanex Energy: Oceanex Energy is an Australian company specialising in offshore wind in both Australia and New Zealand. It is currently progressing the development and construction of four floating offshore wind farms off the New South Wales coast and a fixed offshore wind farm off Western Australia. The projects have a total proposed capacity of 9GW.

Oceanex Energy was founded by Australians, Andy Evans and Peter Sgardelis, who together with Terry Kallis also co-founded the Star of the South project.

Equinor: Equinor is Norway’s largest oil and gas. In addition to oil and gas, Equinox has a portfolio of renewable and low-carbon projects, and a stated ambition of becoming a net-zero company by 2050.

Equinor entered the Australian offshore wind market in August 2022 by acquiring an interest in three offshore wind farms proposed by Oceanex Energy in New South Wales.

BlueFloat Energy: BlueFloat Energy is a global developer focussing on floating offshore wind technologies. It is currently developing two floating and two fixed offshore wind projects in Australia in partnership with Energy Estate. The projects have a total proposed capacity of 5.5GW.

Energy Estate: Energy Estate is an Australian renewable developer with a portfolio of onshore and offshore wind, solar, green hydrogen, e-fuels and transmission projects, many of which it is co-developing with a range of partners. In June 2022 Energy Estate revealed plans to launch a A$500 million capital raising to underwrite its development pipeline, including its joint offshore wind projects.

Copenhagen Energy: Copenhagen Energy is a Danish renewable energy developer founded in 2020. Since then, it has announced plans to develop four offshore wind farms off Western Australia with a total proposed capacity of 12GW.

Despite its relative youth, Copenhagen Energy has signalled its intent to lead Western Australia’s energy transition by announcing that the each of its proposed offshore windfarms will power three million homes in Western Australia.

Flotation Energy: Flotation Energy is a specialist developer and owner of offshore wind projects.

It currently has three proposed offshore wind projects in Australia, with a total proposed capacity of 3.75GW.

Alinta Energy: Alinta Energy owns and operates power stations and electrical and gas transmission assets across Australia and New Zealand. It is now exploring the potential for an offshore wind farm to supply the Portland Aluminium Smelter.

If successful, the project will supply up to 100% of the smelter’s energy needs and inject renewable energy into Australia’s main grid.

Pilot Energy: Pilot Energy is an ASX listed oil and gas company that is currently exploring opportunities to leverage its existing oil and gas assets to develop renewable energy projects, including an offshore wind farm around its Cliff Head Offshore Oil Field production facilities.

Pilot Energy entered into an agreement to sell a majority interest in the project to Triangle Energy, however the sale was abandoned in February 2022 when the National Offshore Petroleum Titles Administrator refused to grant regulatory approval to Triangle Energy.

Nexsphere: Nexsphere is an Australian renewable energy developer, with a small team of Australian finance and infrastructure specialists. Its first project is the Bass Offshore Wind Energy Project based off the north-eastern coast of Tasmania.

If successful, the project will generate between 0.5-1GW of renewable energy and support the Tasmanian Government’s impressive target of generating 200% renewable energy.

Shell Plc: Shell Plc is a major international energy oil and gas company expanding operations and diversifying from fossil fuels and into clean energy.

Shell is now considering its own offshore wind project in Australia. investigating two sites in Gippsland. This would transform Shell’s Australian portfolio, with its first wind investment in Australia made in April 2022 when it acquired 49% in WestWind Energy Development Pty Ltd which has wind farms in Victoria, New South Wales (NSW) and Queensland.

Ørsted: Danish offshore wind giant Ørsted is responsible for about 30% of the world’s installed offshore wind capacity (excluding mainland China). While it has not yet entered the Australian offshore wind market, it will be interesting to see whether Ørsted joins other international developers which are increasingly showing interest in Australian offshore wind.

RES: UK-headquartered renewables developer RES has also revealed an intention to develop offshore wind farms in Australia, starting with the Gippsland region where preliminary technical and ecological studies are already underway. While no formal plans have been released, the announcement itself is exciting given that RES is an experienced developer of offshore wind in Europe. We suspect that RES will also enrich the Australian offshore wind market with its experience as an operations and maintenance service provider.

Part B: the projects


Part C: the regulation


Offshore Energy Infrastructure (OEI) Framework

The national regulatory framework for offshore wind projects was established in June 2022 by the:

  • Offshore Electricity Infrastructure Act 2021 (OEI Act);
  • Offshore Electricity Infrastructure (Regulatory Levies) Act 2021; and
  • Offshore Electricity Infrastructure (Consequential Amendments) Act 2021

The OEI Framework is a welcome development in the offshore wind industry, as it introduced the licensing regime for offshore wind projects in Commonwealth waters (ie, the area from three nautical miles off the coast to the outer boundary of Australia’s exclusive economic zone).

While the OEI Act set establishes the framework, the mechanics of the OEI Framework and licensing regime (including fees and the form of licence applications) will be contained in the regulations, which are still being developed.

The Australian Government sought input on drafts of the Offshore Electricity Infrastructure Regulations 2022, Offshore Electricity Infrastructure (Regulation Levies) Regulations 2022 and Cost Recovery Implementation Statement. The public consultation on 22 April 2022, but we are yet to see the final regulations. Given the change in government since then, it will be interesting to see how the regulations have developed and if they reflect our new Labor government’s commitment to energy transition.

Declared areas

Importantly, the OEI Act empowers the Australian Government to designate areas to be used to develop offshore renewable energy infrastructure. In fact, a ministerial declaration must be made before feasibility or commercial licences can be granted over an area under the OEI Act. On 5 August, Federal Energy Minister for Climate Change and Energy Chris Bowen announced his intention to declare the Gippsland area as being open for offshore wind development, subject to a public consultation process. The minister is currently accepting submissions from the public. Once the consultation process concludes on 7 October, the industry will be keenly awaiting a formal declaration by the minister. We expect that the next consultation, after Gippsland, will be for the Hunter region.

In the same announcement, the minister identified another five which have “world class offshore wind energy potential”. Public consultation for the regions (illustrated via the map and icons below), will be announced in due course:

  • Pacific Ocean region off the Hunter in NSW;
  • Pacific Ocean region off the Illawarra in NSW;
  • Southern Ocean region off Portland in Victoria;
  • Bass Strait region off Northern Tasmania; and
  • Indian Ocean region off Perth/Bunbury, WA


Victoria has placed offshore wind at the centre of its plan to meet its net-zero target by 2050. The state is targeting generation of 20% of its energy needs from offshore wind within a decade.

Studies commissioned by the Victorian Government found that the waters near Gippsland and Portland have the potential to support 13GW of capacity, equating to more than five times the current renewable energy generation in Victoria. These regions are close to existing grid infrastructure and experienced personnel in the energy sector, which means that they are ideally positioned to support Victoria's clean energy transition.

Offshore Wind Policy Directions Paper

The fund aims to bring intellectual property, innovation, local economic development and environmental benefits to the state, local businesses and communities and will be achieved through supporting activities that progress innovative projects in their commercialisation continuum.

The plan relies on three staged capacity targets:

  1. 2GW by 2032 (this will involve procuring an initial offshore wind tranche);
  2. 4GW by 2035; and
  3. 9GW by 2040.

To date, Victoria is the only state to have set offshore wind generation targets. It is a key part of the state’s plan to replace energy generated by the Yallourn and Loy Yang A power stations, which are due to close by 2028 and 2045 respectively.

For now, the Offshore Wind Policy Directions Paper only communicates the state’s commitment to offshore wind. A more detailed plan will be unveiled in the Offshore Wind Implementation Statement, which will be released in September 2022. The statement should detail the expected scale and timing for Victoria’s first offshore wind procurement, as well as the state's plans to deliver a transmission network and port upgrades.

An offshore wind business case will be prepared in 2024 and the 2032 target will be finalised in turn.

Energy Innovation Fund (EIF)

The Victorian Government is further supporting the offshore wind sector through the EIF, which is targeted at funding the commercialisation of renewable energy technologies in Victoria. It can fund up to 50% of a project’s eligible expenditure (which includes contract preparation, wages, legal expenses, licensing and intellectual property costs, but not property acquisition or R&D costs).

The fund is being delivered in multiple rounds with Round 1 of the EIF dedicated to offshore wind. As shown in Table 2 below, three projects secured funding under Round 1 with a total of $37.9 million provided to support the completion of feasibility and pre-construction activities.

Applications for Round 2 of the fund, which was open to any renewable technology type, closed in September 2021. Successful proponents have not yet been announced by given the State’s clear emphasis on offshore wind and the number of projects being developed in the region, we would be interested to see if the list includes offshore wind proponents.

Table 2: EIF Round 1 funding allocations

EIF funding allocations

New South Wales

With its long coastline and stable continental shelf, NSW has strong potential for offshore wind. While the NSW Government has not announced any regulation or targeted government support, it is hoping to attract offshore wind projects in its Renewable Energy Zones.

Renewable Energy Zones (REZs)

In NSW, the pathway for renewable projects has been lit by the Electricity Infrastructure Investment Act 2020 (NSW) and the NSW’s Electricity Infrastructure Roadmap, which received almost unanimous support in state parliament. The Roadmap will deliver five REZs in the Central-West Orana, Illawarra, New England, South-West and Hunter-Central Coast regions of NSW. The REZs will deliver an intended network capacity of 12GW.

Central-West Orana

The most progressed is the Central-West Orana REZ, which has three groups shortlisted to deliver the transmission network. Projects will also be able to bid for access rights from October 2022 according to AEMO’s draft tender guidelines.

New England

The New England REZ is intended to host a massive 8GW of wind, solar and storage projects. EnergyCo expects to commence the tender process for the New England REZ later in 2022.


In June 2022 EnergyCo called for registrations of interest for the Illawarra REZ. The Illawarra region is an industrial precinct and is well-placed to harness significant offshore wind generation. It is supported by existing energy infrastructure and a skilled workforce. The call is expected to receive significant interest from offshore wind projects.

EnergyCo has revealed that two separate 2GW offshore wind projects have already been proposed off the coast of the Illawarra, which could connect to existing infrastructure to generate affordable, clean and reliable electricity.

Offshore wind energy targets

Following Victoria’s lead, the NSW Government is currently exploring opportunities to declare targets for offshore wind energy generation. In August 2022, EnergyCo appointed Arup Australia to conduct an offshore wind scoping study. At the time, the Department of Planning and Environment indicated that Arup’s report would inform the NSW Government’s policy options in relation to offshore wind. While no official targets have been announced yet, the Victorian targets were preceded by a similar study. The final report is expected to be released in early 2023.

Floating offshore wind

As noted above, the Federal Energy Minister for Climate Change and Energy has announced its intention to declare the Illawarra and Hunter regions in NSW as being ready for offshore wind development. However, the oceans in both regions are much deeper compared to the Gippsland region, for example. As such, developers would most likely need to install floating turbines.

Currently all six offshore wind projects proposed in NSW will be floating wind farms. Given the renewed focus on improving floating technologies (discussed further in Part D), we may soon see this list grow.

Table 3: Floating offshore wind projects in NSW

Floating offshore wind projects

Part D: industry development

Blue Economy Cooperative Research Centre

Offshore Wind Energy Report

In July 2021, Blue Economy released its Offshore Wind Energy Report which found that Australia has high quality and abundant offshore wind resources with the potential to support 2,000 GW of power generation – far in excess of total current electricity generation.

In particular, the report found that ongoing expansion to large 15MW turbines can enable single projects with capacity of 1-2 GW. This means that offshore wind can upscale rapidly as coal plants close and the energy transition accelerates. It also highlighted the need for a regulatory regime to facilitate these renewable energy projects, which is now coming to fruition with the implementation of the OEI Act.

Blue Economy Seminar: Trends, Challenges and Future Perspectives for Floating Offshore Wind Turbine Development

In September 2022, Blue Economy also held its industry seminar to discuss floating offshore wind technology. The seminar was clear that the industry needs to increase its use of floating offshore wind, as it can be installed in deeper water than fixed wind turbines. Floating offshore wind can therefore take advantage of the windier conditions that are experienced in deeper water.

While floating technologies have not come as far as fixed technologies, the seminar signalled the sector’s keen interest in floating offshore wind. Importantly, the costs of floating offshore wind turbines are expected to decrease as developers upscale their designs. Developers are particularly focussed on redesigning their mooring systems so they can support a larger turbine size and harvest offshore wind energy more efficiently.

Australian Energy Market Operator (AEMO): Integrated System Plan (ISP)

The ISP released by the AEMO in June 2022 reported that offshore wind has great potential in Australia because it is a high-quality resource which comes with lower social licence hurdles. The report also recognises that offshore wind has gained more support, and will continue to gain support, as some coal-fired power stations have brough forward their planned exits.

The ISP found that the industry has a pressing need for dispatchable batteries which can manage daily and seasonal variations in the output from offshore wind (as well as the output from solar and onshore wind).

While offshore wind did not feature prominently in the 2022 ISP, the reducing cost of offshore wind and increasing regulatory support from the Commonwealth and Victorian Governments is a critical development which could see this change in future ISPs.

Consultants and advisers

We have also seen a recent influx of renewable energy advisory services in the Australian market, which should support the growth of our offshore wind sector. For example, Green Giraffe has opened an office in Sydney, which will offer its full range of financial advisory services for energy transition projects and investors (including development equity, M&A, debt advisory, tender and strategic support).

Nordic Renewables has also started providing project documentation and bankability data services to renewable projects out of Melbourne. Nordic Renewables was founded by Jacob Jacobsen who brings 18 years of global offshore wind experience to the role.

First Power Renewables, founded by Star of the South’s former commercial director Adam Thyboe in August 2022, has also been established to provide expert commercial and advisory services to the Australian offshore wind sector.

The cost of offshore wind is reducing, and further cost reductions could see it feature more prominently in future ISPs, particularly if it secures direct third-party support or land use considerations limit onshore development (AEMO’s Integrated Systems Plan, June 2022)

First of its kind energy experience

As an independent firm, we are able to forge deep working relationships with other large, pre-eminent law firms working in the renewable energy space and offshore wind more specifically, thereby accentuating our domestic depth and being able to employ international best practice. For any further information, do not hesitate to get in contact with one of our market leading partners listed below.

Star of the South

Clayton Utz acted as Australian legal counsel to Danish fund manager Copenhagen Infrastructure Partners (CIP) on its partnership with Australia's Offshore Energy Ltd (Offshore Energy) to develop the proposed A$8 billion 2GW "Star of the South" project – Australia’s first offshore windfarm, and the country's largest ever windfarm project. We worked closely with Orrick and Accura with both firms having worked with CIP on numerous offshore wind projects globally.

Australia Pacific LNG (APLNG) Project

We are the project counsel to APLNG and its shareholders since its inception in 2008, with a number of legal practice groups collaborating effectively to implement and successfully develop one of Australia's largest energy projects. Working with both Sullivan & Cromwell and Latham & Watkins, we worked to market this energy project to foreign institutional investors.

Advising on the development of Australia's first hydrogen energy production plant pilot project

Clayton Utz is the Australian Counsel on the Hydrogen Energy Supply Chain (HESC) project in Victoria which involved the formation and operation of joint venture arrangements with six consortium members in Japan and Australia. Consortium members include Kawasaki Heavy Industries Ltd (KHI), its wholly-owned Australian subsidiary Hydrogen Engineering Australia Pty Ltd (HEA), J-Power, Iwatani Corporation, Marubeni Corporation, Sumitomo Corporation and AGL. Clayton Utz has been involved throughout the project, including in the development and negotiation of the arrangements between the State of Victoria and the Commonwealth in relation to funding arrangements, and the consortium agreements between the (now) eight other members of the project.