Australian Economy

South Australia seeks ideas for Whyalla hydrogen hub, both blue and green

The South Australia Labor government has called for designs and delivery concepts for the $592 million hydrogen hub it promised to deliver during the state election campaign, but is staying vague on what colour of fuel it prefers.

At the Australian Hydrogen Conference in Adelaide on Tuesday, SA Premier Peter Malinauskas launched a six-week market sounding process for the planned Whyalla facility, starting May 31 and closing July 15, 2022.

Malinauskas first unveiled the plan to build the hydrogen hub, including a 250MW electrolyser and a 200MW hydrogen-fuelled power station, just weeks out from the state poll, which saw the Liberal government ousted after just one term.

But as RenewEconomy has reported, Labor’s focus on a hydrogen power plant being the key to provide “firming” capacity to support renewables in the state has raised eyebrows about whether it is the smartest and cheapest avenue.

South Australia energy minister Tom Koutsantonis has maintained that it is, comparing it to the Tesla big battery at Hornsdale that the previous Labor government funded before losing power in 2018.

Details are also sketchy about the colour of the hydrogen that would be produced and used at the Whyalla facility, and newly revealed plans for specialised hydrogen legislation for the state don’t make things any clearer.

Speaking at the conference on Tuesday, Malinauskas said the legislation to license and regulate the production of hydrogen in SA would cover manufacturing of “all forms” of hydrogen, including green from renewables, and “blue” from gas in conjunction with carbon capture and storage.

The premier also said the new hydrogen Act would be similar to what has been afforded to the oil, gas and geothermal industries in South Australia through the Petroleum and Geothermal Energy Act 2000.

Dedicated legislation to help fast-track the establishment of hydrogen production facilities has been a focus of governments around the globe, as the vital role of the zero emissions fuel in a renewable future becomes clear.

But in the EU, for example, there has been an equal focus on establishing firm standards to ensure that hydrogen production is green, only, including Delegated Acts on the definition and production of renewable hydrogen – to ensure fossil fuels are not part of the mix.

This has not been the approach of SA Labor – at least not at a hydrogen conference whose listed major sponsors include Santos, BP, Ampol, Australian Gas Infrastructure Group and Woodside.

“South Australia’s Hydrogen Jobs Plan is deliberately ambitious. We are building a globally significant hydrogen facility that will keep South Australia at the forefront of the hydrogen industry,” said Malinauskas.

“Its design and implementation, including the completion of a high-quality site selection process, will rely on a collaborative, multi-disciplinary effort by many project partners and stakeholders.

“Through fit-for-purpose regulation, South Australia will be able to provide efficiency and certainty to industry,” the premier said.

“This is an opportunity to design and execute a project that best leverages significant government investment for the benefit of South Australians over the short and long term,” added Koutsantonis.

“South Australia has a rich history of advancing new energy technologies that has resulted in over 62% of the state’s energy being generated from renewable resources.

“Just as the Hornsdale Power Reserve has paved the way for four new grid scale batteries to be built in South Australia, with a fifth on the way, the Hydrogen Jobs Plan will help accelerate the state’s hydrogen industry.”

Earlier this month, at the Green Hydrogen Global Assembly in Barcelona, iron ore billionaire and green hydrogen investor Andrew Forrest and former prime minister Malcolm Turnbull slammed the promoters of fossil fuel hydrogen projects, describing them as “liars.”

Turnbull, told reporters on the sidelines of the Spain conference that he “wouldn’t put a nickel” into blue hydrogen, and said the pursuit of CCS was madness.

“How many times do you have to be disappointed by carbon capture and storage?” Turnbull told Recharge. “Isn’t it the definition of madness to keep on doing the same thing, expecting a different result?”

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