"This is a big project and its success will be very much hinged on strong government legislation on renewable energy targets," said Andrew Durran, executive director of Epuron Australia.

Durran said the decision to build the giant wind farm, which could power about 400,000 homes, was backed by the government's plans to set binding targets for renewable energy.

The Federal Government proposed in September that 15 percent of Australia's energy would come from non-polluting sources by 2020.

New South Wales state, where the wind farm will be located, has set a target for renewable sources to generate 10 percent of the state's power supply by 2010.

Construction of the wind farm was expected to begin in 2009 and would take about three to four years to complete, Durran said. The farm would produce between 300-400 megawatts of electricity in its first phase.

Upon completion, the wind farm could reduce Australia's greenhouse gas emissions by at least 3 million tonnes of carbon dioxide per year.

Hamburg-based Conergy has about 15 percent of the solar energy market in Australia. The company said in August it aims to generate 25-30 percent of its turnover from the Asia-Pacific region within five years due to booming regional energy demand, up from 2-3 percent currently.