Offshore wind auction kicks off to boost Victoria power supply

The sector is forecast to attract billions of dollars in investment.

The Allan Labor Government will open Australia’s first offshore wind auction in August 2026, seeking 2 gigawatts (GW) of new generation capacity to boost Victoria’s power supply.

Energy and Resources Minister Lily D’Ambrosio announced the Request for Tender this week, marking a major step in establishing a local offshore wind industry.

The move follows in-principle support from Australia’s Energy Ministers in December for the Electricity Services Entry Mechanism (ESEM), a framework intended to accelerate new renewable energy projects and help Victoria meet its clean-energy targets.

The government said it is working with industry and the Commonwealth to finalise both the ESEM and the auction design to ensure a competitive process.

Officials said Victoria’s offshore wind resources rank amongst the best in the world and will help stabilise the grid as coal-fired power stations retire, whilst keeping pressure on electricity prices.

The government said its renewable energy investments have already helped keep wholesale power prices the lowest in the country and that further projects will add cheaper electricity to the grid.

The offshore wind sector is forecast to create more than 6,000 jobs and attract billions of dollars in investment, with Gippsland set to host the nation’s first projects.