SEC to buy Gippsland project for up to $700 million
A hurdle-plagued Gippsland wind farm will be bought outright by the State Electricity Commission, spending up to $700 million to own and deliver the project.
SEC’s acquisition of the Delburn Wind Farm, which was first approved in 2022 and bogged down by delays due to the project’s location in a pine plantation, will allow construction to begin in early 2026 and is expected to be completed in 2028.
Once completed, it will have 33 turbines producing 205 megawatts of electricity, capable of powering more than 130,000 homes.
According to the deal to be announced by Energy Minister Lily D’Ambrosio on Tuesday, the SEC will spend $650 million to $700 million to buy the wind farm to be built in the Strzelecki Mountain Range from private investors.
The government says this is the first wind farm project in Victoria to fully secure funding in the last 12 months.
SEC promotes investment in renewable energy production and also serves as a retailer to all state government departments and functions, D’Ambrosio said.
“SEC is powering the Victorian government’s operations with 100 per cent renewable electricity, with all profits being invested in projects that will deliver more renewable energy and lower electricity bills for Victorians,” he said.
Approval for the wind farm at Delburn was first submitted to the Victorian planning minister. The plan triggered a local outcry, warning that the development was a bushfire risk, in part due to its location on a plantation.
It was approved by the planning minister in 2022, but this decision continued to be challenged in court by community groups until the case was dismissed in 2023. To alleviate community concerns, developers have proposed using artificial intelligence to manage wildfire risks, among other measures.
But the project remained under a cloud after further changes to planning permissions were sought and construction timelines were regularly pushed back between 2024 and 2025. The wind farm will be SEC’s first project in Gippsland, which has been vital to the country’s energy system for decades through large coal-fired power stations.
“This project will capitalize on the Latrobe Valley’s proud history as Victoria’s energy hub and ensure the region continues to play a leading role in our renewable energy future,” Eastern Victoria MP Tom McIntosh said.
The project is estimated to create 300 local jobs and channel $22 million into neighborhood programs and community benefit funds.
The announcement of a third SEC project comes two weeks after the completion of its first investment, a large-scale battery project in Melbourne’s west known as the Melbourne Renewable Energy Centre. When the commission was first revived, the Victorian government committed to spending $1 billion on renewable energy or storage projects and reinvesting profits from those investments into other projects.
It has now surpassed that figure and committed at least $1.27 billion, investing $245 million in a battery hub, at least $650 million in a wind farm and $370 million in a solar and battery park under construction in Horsham.
The decision to invest in a struggling onshore wind project in a year when no similar projects have been fully funded is in line with the SEC’s vision first outlined by CEO Chris Miller in 2024.
At that time, he said that the commission would invest in projects. where the private market is still unsure The state is trying to close a five-gigawatt gap between where Victoria should be and the current trajectory of renewable energy and storage projects scheduled to be delivered by 2035, according to the Australian Energy Market Operator.
“The SEC has now committed more than a gigawatt of renewable energy capacity, which is a quarter of our 2035 goal of 4.5 gigawatts,” Miller said in a statement Monday.
Offshore wind, another key element of the state’s energy policy, is under serious pressure after several private sector developers pulled out of tenders to farm off the Gippsland coast.
The state will not meet its target of generating 2 gigawatts of offshore wind by 2032, Victoria’s Auditor General said this month.
Experts have criticized the SEC’s most frequently stated goal of lowering household energy prices as being difficult to achieve directly.
The government argued that it achieved this by increasing renewable generation and encouraging the electrification of households.
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