With the game-changing Star of the South proposal in Victoria representing an opportunity to establish Australia’s very own offshore wind sector to act on climate change, it’s important we learn from leading jurisdictions about the key to successfully establishing the sector.
Without offshore wind laws or policy of any kind, there is much Australia can learn from countries leading on offshore wind like Denmark and the United Kingdom.
In part one of our blog series on offshore wind success stories, Yes 2 Renewables has taken a look at the offshore wind industry in Denmark, focusing on what policies are needed to get the sector off the ground, create jobs, and cut emissions.
Across Europe in 2019, there was over 22,000 MW of installed offshore wind capacity with 3,623MW added in that year alone . Denmark has been a leader in renewable energy for over 30 years with the inception of its first energy plan in 1976 creating energy taxes to support research into renewable energy. By 1996, renewable energy targets were set for 12-14% by 2005 and 25% by 2030. These targets were progressively enhanced, and in 2011, the government announced all electricity and heat would be renewable powered by 2035 and all energy by renewables by 2050 . Policy levers such as taxes, production subsidies and research and development programmes enhanced wind turbine adoption with fixed feed-in tariffs obligating the Danish Transmission System Operator (TSO) to purchase the country’s total renewable electricity supply secured private investment in the industry. 
Offshore wind plays a significant part in the renewable energy plans for Denmark with the first turbines installed in 1991. In 2018, the Danish government signed an energy agreement, enabling it to meet it’s 2030 target of 50% renewables . This target was further ramped up to 70% by 2030, in 2019 with 5 year targets . A key part of the commitment included the construction of three large new offshore wind farms. Danish energy production from offshore wind grew from 1.3GW to 1.7GW in 2019, and recently announced plans to develop a $30billion offshore wind island .
Not only does the Danish government’s commitment to offshore wind driving the transition to renewable energy, it is creating a long pipeline of jobs too. A report jointly published by the Economic Council of Labour Movement (ECLM) and the United Federation of Workers in Denmark, point to an increase of over 3,500 direct jobs over a 10 year period thanks to .
A key ingredient to setting up offshore wind is a legal framework for granting projects licenses to construct and generate electricity.
In Denmark the Danish Energy Agency manages the procedures for permit schemes for offshore wind projects. There are two different processes: government call for tenders and open door procedures with legislation defined in the Promotion of Renewable Energy Act, which states that all rights to use wind and water for energy production within Danish waters remain with the Danish State . Most projects in Denmark have been developed in response to public tenders, enabling the government to strategically develop the industry over time, and ensure projects are built in the best locations, with the best resource and to the best standard.
Comprehensive environmental impact assessments are performed on all offshore wind farm projects. This includes monitoring before, during and after the establishment of the wind farms and the environmental impacts on marine conditions . This will be an essential ingredient to establishing offshore wind here in Australia — it needs to be done well.
The supportive environment set by the Danish government for renewable energy and the offshore wind industry through legislated renewable targets, taxes and tariffs and commitment to specific projects provides certainty for companies and investors to back offshore wind projects. Coupled with job projections to support new projects and ongoing operations, offshore wind is a significant contributor to the Danish renewable energy targets.
Denmark’s strategic approach to setting up the industry has been key to providing certainty
With the Australian offshore wind industry in its infancy, we should be learning from success stories like Denmark, where the government’s strategic approach has helped get the sector off the ground, provided long term certainty, a long pipeline of jobs and a secure form of renewable energy supply.
If Australia is going to see the same benefits from offshore wind as Denmark, it’s time for state and federal governments to get a move on.
The first step in Australia must be to establish new national offshore wind laws to create a pathway for game changing projects like the Star of the South to become reality, and to match this with Danish-style industry plans to maximise benefits for local communities and workers.
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- Offshore Wind Farms and the Environment: Danish Experiences from Horns Rev and Nysted, Danish Energy Authority, Nov 2006
Cover image: Horns Rev 3 wind farm in the North Sea, 25-40 km off the Danish Jutland coast. Photo: Ty Stange/Scanpix