Clean energy ‘clear winner’ of Victorian state budget with $1.6bn in funding

Described by the government as “the largest investment in clean energy of any state, ever,” the Victorian Budget 2020/21 adds to last week’s pre-budget news of $797 million set aside for energy efficiency and the extension of the state’s Solar Homes program with a new slate of rebates for rooftop solar and batteries. 

As part of the budget, the Victorian government has committed $540 million to develop six dedicated renewable energy zones (REZs) from “sunny Mildura to the windy east coast” in an effort to accomodate new large-scale solar and wind power projects, paving the path towards their target of 50% renewables by 2030.

As the West Murray Zone have made clear, grid issues have been a major hurdle for large-scale renewable energy projects in Victoria. This budget seeks to address those by following the recommendations laid out by the Australian Energy Market Operator’s recent Transmission Roadmap.

“REZs would allow for the efficient development of much-needed transmission infrastructure in a way that benefits generators, local communities and Victorian consumers,” Clean Energy Council Chief Executive, Kane Thornton, said in a statement.  These Renewable Energy Zones are being earmarked to become “the energy hubs of the future” supporting businesses, jobs and towns across regional Victoria.

Treasurer Tim Pallas’ full budget also pledges $108 million supports to the emerging renewable hydrogen industry and the development of offshore wind, including Australia’s first offshore wind generator, the proposed Star of the South. It will also provide $12.6 million to bring online more than 600 MW of new, clean energy through the government’s second renewable energy auction. The aim is to create enough renewable energy to power 100% of the Victorian government – from public transport to schools and government buildings.

A $10 million investment is also being put towards ensuring the Victorian renewable energy industry is supported by a skilled workforce through the establishment of an independent expert taskforce, the development of an industry-wide workforce strategy for Victorian clean energy, and grants to expand and support the state’s renewable energy education and training capacity.

Environment Victoria has welcomed the budget, saying the Andrews government has set an example for how climate solutions can drive economic recovery. “This is the first state budget since the devastating bushfires and we’re very pleased it includes some big spending to create thousands of jobs by taking significant action on climate change,” CEO of Environment Victoria, Jono La Nauze, said in a statement.

“To cut our greenhouse gas pollution, we need to rapidly clean up our electricity supply. Grid upgrades in six new Renewable Energy Zones across the state will unlock Victoria’s incredible wind and solar resources, bringing enormous amounts of investment and jobs to regional Victoria,” he added.

La Nauze said the funding for the REZs combined with the $100 million commitment to accelerating the Victoria to NSW Interconnector (VNI) West including the KerangLink line, will move Victoria towards a modern energy grid that can incorporate significantly more wind and solar.