A controversial proposal to build a large-scale renewable energy terminal in Western Port Bay will face a full environmental assessment after the Federal Government declared it a “controlled action” under national environment laws.
The decision, handed down by Federal Environment Minister Murray Watt on Friday, means the Victorian Renewable Energy Terminal (VRET) at the Port of Hastings cannot proceed without thorough scrutiny under the Environment Protection and Biodiversity Conservation (EPBC) Act.
The proposed terminal, which includes dredging and land reclamation works, has raised alarm among conservationists and community groups due to its potential impact on the ecologically sensitive, Ramsar-listed wetlands in Western Port.
While proponents of the project recently scaled back its scope — reducing dredging and the extent of wetland loss compared to a 2023 version rejected on environmental grounds — critics say fundamental questions remain about the suitability of the location.
“We are still yet to be presented with convincing rationale for why this terminal must be built in the heart of a UNESCO Biosphere Reserve and Ramsar-listed wetland,” said Shannon Hurley, Marine Campaigner for the Victorian National Parks Association (VNPA).
The VNPA, along with Western Port Biosphere and Save Westernport, welcomed the federal intervention but urged the Allan Government to explore alternative sites and adopt a more strategic approach to managing the bay’s future.
“Marine life and water don’t recognise boundaries — they move throughout the bay, and so do the consequences,”
Hurley said. “The cumulative effect of this and other pressures could be devastating for the health of the bay.”
Western Port Bay is internationally recognised for its biodiversity, providing crucial habitat for migratory birds, endangered marine species, fish nurseries, and expansive seagrass meadows.
In a statement, the Port of Hastings Corporation (PoHC) welcomed the Commonwealth’s decision and confirmed that it does not equate to project approval.
“PoHC’s new EPBC Act referral submission was published on 25 June 2025 following more than 18 months of detailed technical studies, preliminary environmental assessments, and significant design refinement,” the Corporation said.
“Importantly, this is not project approval. Our next focus is continuing with our ongoing impact assessments, and developing and refining our project design.”
The Corporation also reaffirmed its commitment to providing updates and engaging with communities and industry stakeholders as the project progresses.
Meanwhile, environmental groups are calling for a formal marine spatial plan for Western Port — a coordinated, science-based framework to manage development while protecting biodiversity and community values.
The declaration under the EPBC Act ensures that any further steps taken on the VRET project must meet federal environmental standards, adding an additional layer of oversight beyond state-level planning approvals.
