The government of New South Wales (NSW) has declared a Renewable Energy Zone (REZ) in the Illawarra region, the fifth and final REZ to be declared of the first five zones identified under the NSW Electricity Infrastructure Roadmap.
According to the state government, the Illawarra has unique features that make it an ideal location for a REZ, including major energy, port, and transport infrastructure and a skilled workforce.
The region has the potential to harness significant offshore wind generation and strong demand for future hydrogen projects, including those that would power industries that want to decarbonise such as steel production, according to the NSW government.
“The Illawarra has a proud history of manufacturing and the REZ will only build on this legacy, powering existing and emerging industries such as offshore wind, green hydrogen and green steel production” , said Matt Kean , NSW Treasurer and Minister for Energy.
“This is a huge win for the Illawarra with projects registering their interest showing a potential to create more than 8,300 jobs, not including the huge employment potential of offshore wind” .
Last Summer, the state government announced that it had received 44 expressions of interest with more than AUD 43 billion (approx. EUR 27.4 billion) in private investment for power generation and energy storage projects at the Illawarra REZ. Eight of these were for offshore wind farms, four for hydrogen production and two for hydrogen electricity generation projects.
Two separate offshore wind projects have already been proposed off the coast of the Illawarra in 2022: the 1.6 GW Wollongong floating wind farm , being developed jointly by Spain’s BlueFloat Energy and Australia’s Energy Estate, and a 2 GW floating offshore wind farm, being developed by Australia’s Oceanex Energy.
As reported in 2022 by our sibling site Offshore Energy , the Illawarra REZ was the first of the five Renewable Energy Zones the NSW government said would establish through the Energy Corporation of NSW (EnergyCo), the state-controlled statutory authority which leads the delivery of the REZs.
The other four are the Hunter-Central Coast REZ, South West REZ, New England REZ, and Central West Orana REZ, with the latter two being landlocked regions.
The Illawarra REZ runs down the coastline from Wollongong to Shellharbour, and around to Dapto, capturing existing infrastructure such as Port Kembla , Dapto Substation and the Tallawarra Power Station.
With the REZ declaration, the government has now made the first step in formalising the Illawarra REZ under the Electricity Infrastructure Investment Act 2020.
The declaration sets out the intended network capacity (size), geographical area (location) and infrastructure that will make up the REZ. This enables and sets the scope of key legislative functions under the Act, including access schemes and REZ network solutions, according to information on EnergyCo’s website.
Furthermore, the REZ declaration also establishes EnergyCo as the Infrastructure Planner responsible for coordinating the development of the REZ. As the Infrastructure Planner for the Illawarra REZ, EnergyCo will work with network operators to deliver any required augmentations to transmission infrastructure to connect renewable generation and storage projects to the grid, the state authority says.
On the federal level, the Illawarra is one of six priority regions around Australia with world-class offshore wind potential.
In December 2022, the Commonwealth declared Gippsland off the La Trobe Valley as the first region in Australia to be home to a new offshore wind industry, and opened consultation for an area within NSW’s Hunter-Central Coast REZ this month.
The federal government has previously announced further three regions earmarked for offshore wind zones, including the Southern Ocean region off Portland in Victoria, the Bass Strait region off Northern Tasmania, and the Indian Ocean region off Perth/Bunbury.