Renewable energy targets under threat as offshore wind producer considers selling major Victorian project while delays mount

Sky News AU

3 days ago

In a major blow to Australia's clean energy targets, one of the nations largest offshore wind producers is considering selling its Gippsland project off the Victoria coast, while transmission line projects continue to lag.
Bluefoat Energy, based in Spain, acquired a feasibility license late last year to construct a significant offshore wind project off Victoria's Gippsland region and also secured a preliminary development licence in New South Wales with both considered essential in meeting state and federal emission reduction deadlines.
However, The Australian reported that sources within the company revealed BlueFoat was considering departing the Australian market altogether and was further mulling selling off its Victorian development.
However, a spokesman for the company declined to comment and insisted that no final decision had been made.
Victoria, which stands as one of Australia's most fossil fuel dependent states, has some of the most stringent renewable energy targets in the nation, and aims to reach 95 per cent renewable electricity generation by 2035.
Energy experts have been despairing about the feasibility of the state's targets as coal-fired power stations continue to reach the end of their lifespans.
Two of the state's largest coal-fired power stations, Energy Australia's Yallourn and AGL Energy's Loy Yang A, are due to close their doors within the next ten years.
Clean energy projects, particularly in the south-east, continue to be bogged down in protracted delays, including the VNI West project which will now be completed in 2030 as opposed to the original deadline of 2028.
The offshore wind sector also faces lengthening completion timelines, inconsistent state and federal regulation, paired with a lack of global attitude towards the clean energy transition as US President Donald Trump continues to wind down investments in renewable projects both domestically and abroad.
Offshore wind also faces a concerning lacks of transmission infrastructure, local manufacturing capabilities and persistent labour shortages.
BlueFloat's potential withdrawal is set to raise alarm bells at both federal and state levels, with Prime Minister Anthony Albanese and Victorian Premier Jacinta Allan both touting offshore wind as one of the most critical elements to Australia's energy transition.
Victoria unlike other states has placed offshore wind at the heart of its decarbonisation strategy and set a bold target of producing nine gigawatts of offshore wind capacity by 2040, which the state government claims is enough to power more than 6.5 million homes.
However, BlueFoat is not the only global energy consortium facing mounting difficulties in Australia with Norwegian energy firm Equinor also yet to formally accept an offshore wind development licence in NSW.
The International Energy Agency has warned that global costs for offshore energy projects have risen by as much as 40 per cent due to supply chain woes and persistently high inflation.