Chester urges wind farm levy

Photo: File

Philip Hopkins

FEDERAL Member for Gippsland, Darren Chester, has called on the government to impose a levy on Gippsland’s offshore wind farm industry to ensure the regional community shares in the projects’ economic benefits.

In a letter to the Prime Minister, Anthony Albanese, Mr Chester urged the government to back a policy for a revenue stream linked to the income from the offshore wind industry. This would be similar to the ‘Royalties for Regions’ program for the mining sector imposed by the former Western Australia Coalition government.

“Establishing a precedent whereby the host communities for offshore wind projects can derive a direct financial benefit to be spent on local infrastructure needs would help build the social licence for such projects,” he said.

“Such a licence requirement for the duration of would also take the pressure off governments to provide additional community infrastructure to accommodate the forecast increased demand for services.”

The Gippsland Offshore Renewable Energy Zone covers about 15,000 square kilometres from offshore of Lakes Entrance in the east to south of Wilsons Promontory in the west. It includes all three local government areas in Mr Chester’s electorate, either in energy production or its transmission.

The state government plans to have offshore wind farms generate four gigawatts (GW) of energy by 2035 and 9 GW by 2040 as part of its net zero target by 2045. It maintains the projects will create an estimated 59,000 jobs. About 80 per cent of these are in construction.

The Albanese government has awarded Major Project Status to Gippsland’s first offshore windfarm project, the Star of the South.

Federal Minister for Climate Change and Energy, Chris Bowen said Gippsland’s declaration was a crucial step towards affordable, reliable and secure energy and new economic opportunities for Australia.

The government maintains that the start of a domestic offshore wind industry creates tremendous opportunity for local industry and job creation.

The windy Bass Strait off Gippsland, and the strong grid across Gippsland and the Latrobe Valley, mean this area has the potential to support more than 10GW of year-round wind energy generation.

Offshore windfarm investors must submit applications for a feasibility licence by April 27.

Mr Chester said one of the questions raised by local governments was how the region would ensure that successful proponents contribute back to the communities that host the projects.

“While the local community is generally supportive of this fledgling industry, there is a level of concern regarding transmission towers crossing private property, the impact on commercial fishing, and the extent of measurable local benefits in terms of employment and economic activity,” he said.

Mr Chester said the approval process would deal with the first two issues.

“But I am unconvinced that adequate attention is being given to the issue of local and regional benefits,” he said.

If several offshore wind projects go ahead, the community expected that “the industry will contribute to the local community in a substantial and measurable manner”.

Mr Chester said the community did not want to rely on assurances in vision and mission statements promoting corporate goodwill.

“The local community would be supportive of a regulatory or legislative measure which would require the companies to return a dividend to the host communities,” he said.

The state and federal governments say they are committed to working together to consider the Gippsland coast west of Wilsons Prom, including further consultation with Traditional Owners and taking into account community feedback and information on environmental risks of developing offshore electricity infrastructure in the area.

First-in industry projects often pose complex regulatory considerations, and the government awarding Major Project Status to the Star of the South means it can receive tailored regulatory facilitation services – to ensure they meet their obligations without unnecessary regulatory delays.