By Associate Professor Michelle Voyer and Energy Futures Network Director Ty Christopher at the University of Wollongong

Last week, the Minister for Climate Change and Energy, Chris Bowen, announced a pause to the Illawarra offshore wind proposal, following a mutual agreement between the government and the sole developer who applied for a feasibility license. The reason? Uncertainty over the upcoming federal election, with the opposition pledging to scrap the plan if elected.

This pause is more than just a political moment – it’s an opportunity to take stock and consider a bigger question: What should the Illawarra’s energy transition look like? With a clear divide between major parties on offshore wind, the region stands at a fork in the road. This is a chance to make a choice, based on a clear understanding of our options.

Imagine the Illawarra as an Energy Island

For a moment, let’s imagine the Illawarra as an energy ‘island’ – one that must generate enough electricity to meet its own needs but with potential to import or export power. This thought experiment provides a useful lens for understanding our energy landscape.

Currently, Australia consumes around 200 terawatt-hours (TWh) of electricity annually, with roughly a quarter of that used in NSW. Home to Wollongong, the state’s third-largest city, the Illawarra accounts for a significant portion of this demand. Using conservative estimates, the region requires around 2.5 TWh per year. But as we move towards greater electrification, that demand is expected to double by 2050. So let’s take 5TWh as the target we need to reach to achieve a self-sufficient energy supply for our island.

So, what energy mix could power the Illawarra, both today and into the future?

The Building Blocks of Our Energy Future

There are a number of options for achieving our 5TWh target. We have been conservative on the hypothetical target we need to generate and generous with the projected contributions of all these options. So these figures should be taken as estimates for illustrative purposes only – actual contributions will vary according to a range of factors and variables.

1. Rooftop Solar – A Strong Start

Solar is already playing a major role in the energy transition. Roughly 40% of the Illawarra’s current energy needs are met by solar, and we have room to grow.

As we wrote in The Conversation last year, we estimate that if all 130,000 homes in the Illawarra had solar panels, they could generate a theoretical maximum of 0.95 TWh per year. However, much of this power is consumed in the home rather than exported to the grid. But for simplicity, let's assume rooftop solar could provide this theoretical maximum, which is nearly half of our current energy demand and about 19% of future demand.

2. Industrial Solar – A Modest Contributor

A 100 MW industrial solar farm can generate approximately 0.2 TWh per year, but land availability is a challenge. Each farm requires 200 hectares (about 285 rugby fields), and while space for large scale solar farms in the region is limited, industrial rooftops present an opportunity. Based on recent research, we can assume that, with some effort, we could likely generate around 0.6 TWh per year from industrial solar (about 12% of future demand).

3. Gas – A Short-Term Firming Solution

The 765 MW Tallawarra gas plant plays a firming role, providing backup power during peak demand or when renewables aren’t generating. Gas is a fossil fuel and retaining it in the energy mix won’t drive deep decarbonisation, however, it remains part of the short-term energy mix. And with sufficient power, there is capacity to transition to the use of hydrogen in this facility in the future.

There are a lot of variables that will influence the output of this plant, including fluctuations influenced by factors such as operational demand and maintenance schedules. We are assuming an average annual output of 1 TWh – approximately 20% of future demand.

4. Onshore Wind – Land Constraints

A 1 GW onshore wind farm can generate 3 TWh per year, but only the largest wind farms in Australia are around this size. This is because these wind farms require substantial land – between 150 and 300 hectares (215 to 430 rugby fields) per gigawatt. While Maddens Plains is often suggested, and is worthy of consideration, much of the area is highly sensitive upland swamp and protected under national parks and environmental conservation zoning. So onshore wind could contribute, but its potential in the Illawarra is limited – let’s assume we can find space for around 0.5GW, or 1.3TWh – about 26% of future demand.

6. Nuclear – An energy import into the Illawarra

The federal opposition has suggested building two nuclear reactors in NSW. A 1 GW nuclear plant could generate 7.4 TWh per year. Two plants of this size would therefore contribute approximately 30% of the state’s current energy needs but would still not be enough to supply the state’s peak demand needs. No nuclear power plants are proposed for the Illawarra, so for our energy island we would need to import nuclear energy from the Hunter. Let’s generously assume 10% of our future energy needs might come from nuclear (0.5 TWh). It should be noted that nuclear energy is not currently legal in Australia, so we cannot bank on this being part of our energy mix for at least 15 to 20 years.

7. Offshore Wind – an energy export for the Illawarra

The proposed 2.9 GW offshore wind zone could generate up to 12 TWh per year, more than double the amount required to meet the Illawarra’s projected energy demand, with enough left over to support industrial decarbonisation or green hydrogen production. Unlike onshore wind, offshore wind has higher capacity factors and is less constrained by land availability so turbines can be bigger and there can be more of them.

However, they are still likely to be constrained by significant environmental, cultural and economic requirements. Therefore, whilst we assume the Illawarra offshore energy zone will be able to operate to its full capacity, whether it can in practice would depend on a range of environmental, technical, socio-economic and cultural assessments.

How do the options stack up?

Once we consider all the pieces of the puzzle – the contrast between the two options before us becomes clear.

The nuclear option – coupled with a moderate-sized onshore wind farm, industrial and rooftop solar, and the continued use of gas in the Tallawarra power plant – gets us to about 87% of the future energy needs of our hypothetical Illawarra energy island. The remainder of our energy needs would have to be supplied from elsewhere, either through continued use of coal, scaling up of gas or relying on our neighbours to host onshore wind and solar farms in surrounding regions.

The offshore wind option – which does not include any onshore wind component – would mean we are not only self-sufficient as a region, but energy becomes part of our economic contributions to the state, with a potential surplus of over 9TwH to offer to the grid. It would also give us sufficient capacity to transition the Tallawarra power plant away from fossil fuels and towards green hydrogen as the technology becomes scalable.

What About Reliability?

The challenge isn’t just replacing coal – it’s ensuring a stable, reliable grid. As critics often point out: "The sun doesn’t always shine, and the wind doesn’t always blow."

But just as we store water for when it doesn’t rain, we can store electricity for when renewables aren’t generating. Energy storage solutions – such as home batteries, community batteries, grid-scale storage, pumped hydro and gravity-based storage – are being deployed at an increasing pace.

Right now, the National Electricity Market (NEM) has 2.7% (2.4 GW) of its demand supplied by large-scale storage – excluding smaller home and community batteries. By 2027, a further 16 GW of storage is expected to come online.

The Path Forward

As we electrify homes, cars and industries, our electricity demand will grow. This transition is an opportunity – but only if clean, affordable energy is accessible to everyone.

The pause on offshore wind gives us time to consider our options, but not forever. The Illawarra has a choice: Take charge of its energy future — or let external forces decide for us.

Acknowledgement: Thanks to Freya Croft for graphic design assistance.

About the writers

Michelle Voyer is an Associate Professor with the Australian National Centre for Ocean Resources and Security (ANCORS) at the University of Wollongong. 

Ty Christopher is the Director of the Energy Futures Network at the Faculty of Engineering and Information Sciences at the University of Wollongong. 

Read more

• Navigating the Illawarra Offshore Energy Debate: A Call for Collaboration
• Get the numbers on Nuclear Energy
• Green v Green: The new face of environmental debate
• Deep dive: How oil rig rehab is inspiring ‘nature positive’ wind farm design
• Common Ground: 'We need more research'
• The Why of Offshore Wind