“No longer commercially viable”: Spaniards abandon offshore wind in Gippsland

BlueFloat Energy has backed out of its offshore wind farm project in Gippsland, claiming the potential profits are not there.

The Spanish company held one of the federal government’s 12 feasibility licences, granted in 2024, for the proposed 2.5 GW Gippsland Dawn project off the coast of Loch Sport.

“BlueFloat Energy’s ultimate shareholder Quantum Capital Group has determined that continuing to fund offshore wind developments is no longer commercially viable in the short and medium term,” the company said. “Funding will no longer be provided to Gippsland Dawn to continue development activities.”

It’s unclear whether the licence will be put back on the market or if the Gippsland Dawn wind farm location will be completely abandoned.

“It is normal for developers to explore projects and then stop work on them, for a variety of reasons internal to their business,” the state Department for Energy, Environment and Climate Action told the Monitor.

“The Commonwealth has approved offshore wind projects for feasibility licences in Gippsland that can generate 23 GW of electricity - more than enough to meet Victoria's energy needs.”

Blue Float Energy has also withdrawn from two NSW offshore wind projects - a 1.6 GW South Pacific project in the Illawarra offshore wind zone and a 1.7 MW Eastern Rise project off the Hunter coast.

Where are the other projects at?

A feasibility licence grants a company the ability to assess the potential of an offshore infrastructure project, and does not guarantee a commercial licence that would allow a company to begin construction.

Under current regulations, feasibility licence holders have up to seven years to complete their studies and prepare for construction.  

According to the Department of Climate Change, Energy, the Environment and Water, there were a total of 37 applications received for feasibility licences.

Victoria’s Gippsland offshore wind zone now has 11 active feasibility licences for projects. Each licence has a proposed power capacity between 1 and 3 GW.

In comparison, the Hazelwood minesite was a 1.6 GW capacity coal fired power station.