THE Dundonnell wind farm is operating at 97 per cent of its annual output as it becomes the first in a Victorian government auction to generate electricity.
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Victoria's Energy Minister Lily D'Ambrosio visited the site on Friday and praised its location and success.
The Victorian government supported the project among five others in a Renewable Energy Target Auction in 2018.
"Within two years we have seen this project come to life," Ms D'Ambrosio said.
"It's fantastic for local jobs across regional Victoria, and puts downward pressure on energy prices, and is about preparing us for the future."
The 336-megawatt wind farm, located 70 kilometres north-east of Warrnambool, will be the third largest in Australia when it reaches full output.
The site is currently producing 295MW, which developer Tilt Renewables says is about 97 per cent of its annual energy yield.
Tilt is working through final regulations with AEMO to reach full output later this year.
Ms D'Ambrosio said the wind farm was in a "great location".
"It is important with our project proponents when selecting areas they want to pursue they have good community engagement and that is something that we have been very keen to stress," she said.
She said the government required the project to use local content for construction, and the site supported landholders to have "their annual income supplemented from hosting the turbines".
"We have had strong local content requirements and required a community fund from the project proponents," Ms D'Ambrosio said.
"It's worth over half a billion dollars. It's magnificent to see what the future is and it's available for us to enjoy."
Tilt Renewables executive general manager Clayton Delmarter said the VRET auction had underpinned the project.
"As the largest project to gain support under the Victorian Government's VRET initiative, Tilt Renewables is proud to be the first of those projects to begin generating clean, renewable electricity for the people of Victoria," he said.
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