Years of hype about inexperienced hydrogen might quickly repay for billionaire Andrew Forrest and different proponents of the longer term business.
The federal funds tipped a shock $2 billion right into a “hydrogen head start” program to ensure Australia retains tempo with rivals.
“If they hadn’t done it, Australia would have precisely zero green hydrogen projects of anything remotely commercial scale in five years’ time,” unbiased vitality analyst Tim Buckley advised AAP.
The money – to be cut up between two or three as but unnamed initiatives – is anticipated to make the numbers stack up for Fortescue Future Industries (FFI) in Queensland.
FFI govt Eva Hanly stated prospects want robust funding indicators that this business can be supported by authorities.
“This announcement does that,” she stated.
“They also need certainty this will be a big enough industry they can switch from a fossil fuel product and not have problems later.
“We want to provide our manufacturing sector certainty there will be sufficient product – that is why this $2 billion is absolutely thrilling.”
Ms Hanly said the budget announcement was an important first step and the federal government had foreshadowed further announcements.
Part of Dr Forrest’s Fortescue Group, FFI’s main focus is green hydrogen which it intends to produce using Australian-made electrolysers and renewable energy.
Heavy industry needed to decarbonise but electrification would not be the whole solution, Ms Hanly said, particularly for steelmaking, aluminium, agriculture and mining.
“What we’ll see is industries like that, who’re desirous to decarbonise, will provide you with a mission partnered with a producer,” she stated.
“My understanding is that business now wants to return to authorities with proposals.”
As well as partnering with the United States Department of Energy, FFI is working with chemicals giant Incitec Pivot at Gibson Island near Brisbane to decarbonise ammonia production.
The first electrolysers made at FFI’s Green Energy Manufacturing Centre in Gladstone, Queensland are earmarked for the proposed green hydrogen to ammonia project on the island.
Building new facilities and power are the biggest costs for green hydrogen, and will differ from country to country and even from state to state in Australia with jurisdictions such as Queensland still heavily dependent on coal-fired power.
Hydrogen plants could be connected to the electricity grid or operate as standalone facilities, hooked into their own renewable energy sources.
Ms Hanly said FFI would “completely guarantee” their product was green hydrogen, not so-called blue and brown hydrogen from gas and coal.
“We will present inexperienced electrons into the inexperienced hydrogen facility,” she stated.
“Whether that is us constructing them, supporting one other generator to develop them on the grid – we’ll guarantee that it is 100 per cent inexperienced hydrogen.”
As well as greening traditional industries with the new fuel, FFI also expects Australia to become a significant exporter to Asia.
“We really want to get out as first mover earlier than they supply it from different jurisdictions,” Ms Hanly said.
Treasurer Jim Chalmers said there would be a competitive process to decide which projects get production credits when the scheme is up and running.
“It is about encouraging extra hydrogen manufacturing,” he stated.
“This is a giant a part of our plan to develop the economic system – hydrogen can be key to our future.”
Woodside Energy is pressing ahead in the US with a hydrogen project underway in Oklahoma. But the company has plans for “H2Perth” – potentially a world-scale hydrogen and ammonia production plant in WA.
H2Perth is one of 19 Australian projects that participated in the design trials for the Guarantee of Origin Scheme for hydrogen that was given the green light in Tuesday’s budget.
Meanwhile, South Australian Premier Peter Malinauskas is on a four-day trade tour of Germany and the Netherlands to pitch a project to investors.
He said the Albanese government’s decision to invest $2 billion in hydrogen energy underscored the importance of SA’s plans for the renewable energy technology.
“It is evident hydrogen goes to be an integral a part of the world’s future vitality wants, and this represents an unbelievable alternative for South Australia,” Mr Malinauskas said.
Dr Chalmers also highlighted in his budget speech the future production of green steel in Whyalla, using SA-made green hydrogen.
The Australian Hydrogen Council had asked the Commonwealth for a strong signal amid fierce global competition for investment dollars.
Council CEO Fiona Simon welcomed the budget’s vote of confidence in renewable hydrogen as part of the energy transition, and as a future export.
But the projects – requiring land, power, water and upgraded ports – will not be possible without the support of local communities.
Some $2 million will support Indigenous communities and businesses to be part of the planning and design.
“It is essential that hydrogen initiatives have the assist of communities and communities reap the advantages from having initiatives of their areas,” Dr Simon said.
Mr Buckley has no doubt Australia will be a renewable industry superpower, with green hydrogen – not any other variant – playing a role.
“Twiggy Forrest has achieved an enormous gross sales job on how Australia needs to be a hydrogen superpower that has been massively over-hyped, however there may be actual potential there,” Mr Buckley stated.
But the electrification – utilizing ample photo voltaic, wind and vitality storage – would be the bedrock of decarbonising the economic system, he stated.
Source: www.perthnow.com.au
