Rural Australian communities are hosting the clean energy boom. Are they getting a fair say?

0 November 12, 2026 16:05

Backlash doesn’t mean communities are rejecting the clean energy transition. Many are asking for fairer benefits, and a bigger say in what the future looks like.

Australia’s transition to clean energy is happening at pace, with regional areas front and centre. Rural communities are being asked to host the wind farms, solar panels and transmission lines to power our biggest cities – sometimes hundreds of kilometres away.

Accommodating these large developments can be burdensome for small communities. Projects can impact farmland and load local roads. They can also pile more pressure on housing and essential services.

To sweeten the deal, affected communities are being promised a once-in-a-generation wave of investment, touted as an economic lifeline for many regional towns struggling to survive.

Not everyone is buying the promise. With a state election looming, Victoria offers some stark examples of how these tensions are playing out.

Some councils have been sidelined by the state government in key decisions. Planning laws have been changed to fast-track projects. In many areas, community backlash has been fierce.

These tensions point to questions that go beyond any individual project. Are regional communities being given a meaningful say in their economic future? And will they actually be left better off?

Big changes are coming

For regional Australia, the scale of change is enormous. So, too, is the economic opportunity it presents.

The Australian Energy Market Operator has estimated that achieving net zero emissions will require $106 billion in new investment (in today’s dollars) by 2050. This includes investment in 6,000 kilometres of new transmission lines across the country.

This money is already flowing. According to the Clean Energy Council, 141 clean energy projects worth about $32.5 billion were financed or already under construction in the first half of this year.

Australia’s transition to renewable energy is well underway.
Chris Gordon/Getty

A noisy, confusing picture

One of the biggest challenges for communities is navigating this rapidly evolving landscape. Each state and territory is taking a different approach to these developments – not only for renewable energy but also for critical minerals and mining more broadly.

Take Victoria, for example. VicGrid and the Department of Energy, Environment and Climate Action recently released community engagement and social value guidelines. These set minimum expectations for engagement with and benefits for communities and landowners who host projects, but (unlike in New South Wales) no minimum dollar-per-megawatt figure.

The guidelines only cover renewable energy and transmission projects, but exclude projects connecting to the local distribution network. Separate compensation arrangements apply to some transmission projects, adding to the complexity.

Initially voluntary, these guidelines only become mandatory in mid-2027, when the extent of collaboration between developers will also be assessed.

Importantly, and perhaps confusingly, they do not cover critical mineral projects. These are covered by separate legislation and still-to-be-determined community benefit payments.

In short, it is a noisy, confusing and dynamic landscape for communities and landowners.

Yet some regional communities are taking matters into their own hands and electing to shape their own energy destiny. In north-west Victoria, for example, Wimmera Southern Mallee Development has been working with energy developers and various government agencies through its Renewable Energy Collaboration partnership.

Not everyone is on board

Victoria again offers some striking examples of vocal community opposition.

There’s been sustained backlash from farmers against the Victoria to NSW Interconnector West (VNI West) transmission project in north-west Victoria, which the state opposition have vowed to scrap if elected.

And in the north of the state, intense community backlash recently convinced the government to abandon a plan to create a new renewable energy zone around Dookie.

This month, Australian Public Policy Institute research (of which I was a coauthor) casts light on some of these concerns for rural Australia more broadly.

This drew on workshops and interviews conducted with a broad range of stakeholders in three towns in regional NSW impacted by renewable energy development. We found affected communities broadly support the shift to clean energy.

However, key community concerns are already delaying the process. This threatens to to undermine the long-term energy transition.

Why communities are wary

Assessing these responses, we found three big challenges for the government and industry.

First, community consultation and engagement were seen as inconsistent and often inadequate. Further, there were limited opportunities for communities, including First Nations people, to meaningfully influence project planning and decision-making.

Second, communication and planning processes lacked transparency, clarity and a place-based focus.

And third, communities are experiencing significant social and economic impacts. Benefit-sharing and compensation arrangements were viewed as inequitable, insufficiently targeted and lacking long-term community value.

Bridging all of these challenges, we found trust in industry, government and the planning system was fragile.

What communities want

Encouragingly, however, we also found regional participants in NSW were keen to provide detailed policy solutions for governments to address many of these challenges.

They called for four key changes.

First, minimum, enforceable engagement standards should be required for all major energy projects. These standards should prioritise transparency, accountability and building trust.

Second, governments should work with communities to develop a framework on sharing of benefits. This should then be embedded into planning regulations.

Third, there should be more support and resources for communities to help with negotiating how project benefits are shared.

And fourth, at all levels of government, planning processes and governance should adopt a place-based approach tailored to local needs.

Building trust

Increasingly for Australia, the main barriers to a successful shift to renewable energy are not technical but social.

Many rural and regional communities feel excluded from decisions about how the transition will be achieved. Importantly, communities are not rejecting the transition. They are asking for better information and communication, fairer benefits, and a genuine role in shaping the changes that affect them.
Simon Wright received funding from the Australian Public Policy Institute.

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