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The transmission infrastructure is needed to connect capacity to meet the state’s first offshore wind target of 2GW by 2032. 

VicGrid chief executive Alistair Parker said that feedback from local stakeholders as well as technical work carried out over the course of 2023 had informed the study area and the associated connection hub.

The study area starts about 6km from the coast near Giffard and travels north-west past Stradbroke West to Willung, across to Flynns Creek, and on to the Loy Yang power station. 

The study area decision is a starting point for further consultation, technical investigations, and planning and environmental approvals, Parker said. 

“These are difficult decisions and communities have been thoughtful and constructive in sharing their views on the issues that are important to them,” he said.

To minimise impacts on smaller private landholders and farmers, the Gippsland offshore wind transmission study area avoids major townships and includes a lower proportion of private land than many of the other options considered.

VicGrid is responsible for coordinating the development of transmission to support offshore wind. Following its analysis, it has ruled out fully undergrounding transmission lines due to challenges including cost, engineering complexity, procurement and timing. 

Instead, it is looking at a double-circuit 330kV or 500kV overhead transmission line, with further detailed analysis required to determine which is the best operating voltage. 

An overhead line is estimated to cost between A$700 million (US$455 million) and A$1.5 billion, while undergrounding is estimated to cost A$2-4.5 billion.

VicGrid said it will now work with landholders and communities in the study area to narrow down a preferred corridor. 

It will also assess the implications of the federal government’s decision to declare a second offshore wind area off the Victorian coast in the Southern Ocean region.