Tenax Energy unveiled plans last September to install 45 undersea turbines near The Heads and asked the Government for permission to use a 169-hectare site within a triangle bounded by Point Nepean, across The Rip to Point Lonsdale and north to Shortlands Bluff at Queenscliff.

Tenax aimed to generate 33.75 megawatts of electricity and feed it into the grid at Point Lonsdale, enough to supply 15,000 homes. The 18-metre and 13-metre high turbines would be 17metres below the surface and at least 500metres outside the marine national park.

On Thursday, Tenax director Alan Major said the company was disappointed the Department of Sustain-

ability and Environment had refused it tenure of the site.

"We have governments around the nation supporting tidal and wave generation as a sustainable way to create electricity. The Federal Government has been very positive and proactive in supporting various projects including our work in Tasmania and Northern Territory. We have positive support from the federal Minister for Resources and Energy and the Department of Innovation, Industry and Regional Development.

"In Victoria, we have the support of the Government's Sustainability Victoria agency."

Mr Major said DSE had given the company a verbal no but nothing in writing. "Until we have something in writing, we cannot appeal against the decision."

On Tuesday afternoon, David Heale of DSE said the department supported the development of new renewable energy projects in Victoria.

"There are areas of the coast where marine renewable energy proposals are unlikely to be appropriate or gain statutory approvals. These include areas of environmental, social and economic significance, such as national parks (marine and land based), shipping channels, aquaculture reserves and commercial fishing grounds," he said.

"One of the main concerns with the [Tenax] proposal was that the location being proposed ... would be likely to disrupt shipping channels at the entrance to Port Phillip.